HomeMy WebLinkAboutStaff Report 3560
City of Palo Alto (ID # 3560)
Finance Committee Staff Report
Report Type: Meeting Date: 3/5/2013
City of Palo Alto Page 1
Summary Title: Golf Course Contracts
Title: Five -year Contract Extension for the Palo Alto Golf Course Management
Services Agreement with Brad Lozares (Lozares); Amendment to Golf Course
Pro Shop Lease with Lozares to Reduce the Term of the Lease From Ten Years
to Five Years; and Five -Year Contract Extension for the Golf Course
Maintenance Services Contract with Valley Crest Landscaping
From: City Manager
Lead Department: Community Services
Recommendation
Staff recommends that the Finance Committee:
1. Review the proposed five-year contract extension for the Palo Alto Golf Course
management services agreement with Brad Lozares (Lozares) (Attachment A), and the
proposed amendment to the existing lease agreement for the Golf Course Pro Shop with
Lozares to reduce the term of the lease from ten years to five years.
2. Review the proposed five-year contract extension for the Golf Course maintenance
services contract with Valley Crest Golf. (Attachment B)
3. Recommend that Council approve, and authorize the City Manager or his designee to
execute, the amendment to the General Services Agreement for Golf Course
management services with Brad Lozares in the amount of $2,058,073 and the
amendment to lease of the Palo Alto Golf Pro Shop premises with Brad Lozares for a
term of 5 years, beginning May 1, 2013 ending April 30, 2018.
4. Recommend that Council approve, and authorize the City Manager or his designee to
execute, the amendment to the General Services Agreement with Valley Crest Golf in
the amount of $4,072,533 and for a term of 5 years, beginning May 1, 2013 ending April
30, 2018.
Background
There are four separate, but related, contracts applicable to the Palo Alto Golf Course:
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1. Golf Course Maintenance Services Agreement (expires April 30, 2013) - Valley Crest Golf
is the service provider. (Existing Contract- Attachment C)
2. Golf Course Management Services Agreement (expires April 30, 2013) - Brad Lozares is
the current services provider. The management services agreement provides Golf
Course and driving range management, Golf Course marshaling, Golf Course revenue
collection, customer service, starting time coordination and cart rental services.
(Existing contract- Attachment D)
3. Golf Pro Shop Lease (expires April 30, 2013, with a current 10-year extension option) -
Lozares is the tenant, and has conditionally agreed to reduce the lease term extension
from ten years to five years, pending Council approval of the five-year extension of the
Golf Management Services Agreement (Item 1, above).
4. The Food and Beverage Services Lease between the City and R&T Restaurant (expires
April 30, 2018). . This Lease is not being amended at this time and is only mentioned as
a reference point for the relevant golf course contracts’ expiration dates falling on April
30, 2018.
One of staff’s primary goals in negotiating these contracts was to have them expire on the same
date.
Staff from Administrative Services, Community Services, City Attorney’s Office, and City
Manager’s Office have carefully considered the pros and cons of a Request for Proposal (RFP)
for both the Golf Professional management services and the Turf and Landscape maintenance
services and have concluded that, on the cusp of a major proposed reconfiguration of the golf
course, now is not the preferred time to conduct the RFP process for these two particular
contracts. The timing of the reconfiguration construction project has not yet been finalized, and
there is some uncertainty of the level of service needed during golf course construction at this
time. If these contract extensions are approved, staff recommends conducting an RFP in April
2018 when all four Golf Course contracts, as outlined above, are expected to expire.
Coordinating the concurrent expiration of the four contracts will provide an opportune time to
attract more interest in bidding on an RFP, because it could well include the entire golf course
operation. In addition, maintaining continuity with the current contractors during the
reconfiguration process will enable certain services, such as the Golf Course driving range, to be
maintained throughout the process. The increased ease of coordination with vendors that are
already familiar with the current operation will be invaluable as the City navigates the multi -
agency reconfiguration process.
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Staff came to this conclusion for several reasons which are summarized below:
1. San Francisquito Creek Flood Management Levee Project
The San Francisquito Creek flood control project managed by the San Francisquito Creek Joint
Powers Authority (SFCJPA) presents significant unknown factors, including, without limitation,
the timing of the project, impact on the golf course operation during construction , and the
quality and performance of the yet to be reconfigured golf course. These unknown factors
make it very difficult to prepare a clear and accurate RFP scope of services for Golf Professional
management services and Golf Course maintenance services; it consequently will be difficult to
evaluate submittals to determine which is most favorable to the City.
The upcoming levee capital improvement work will have a direct impact on the operation of the
golf course during staging and construction. The golf course may be closed for as long as 12 to
18 months to complete the Option G design work. The proposed levee work would directly
affect the golf course and thus it could adversely affect the City’s ability to successfully conduct
an RFP for management services to the extent interest in bidding on an RFP is dampened.
The SFCJPA at this point believes that it will start the two-year construction process on the
levee in April 2014. If the SFCJPA timeline is accurate, the one-year golf course construction
project would also begin in April 2014.
2. National Golf Foundation Recommendation
Extending the terms of the Lozares and Valley Crest contracts beyond the construction period
of the golf course reconfiguration project was recommended by the National Golf Foundation
(an independent consultant who performed Financial Pro Forma and Supporting Analysis for
Reconfiguration Options concerning the reconfiguration project); as well, independent golf
course financial consultant, Richard Thorman, and Golf Course architect, Forrest Richardson,
who were all asked to provide their professional opinions. The consultants agree that the
substantial disruption in business, the unknown impacts of timing and project design, and the
time consuming and costly work involved to produce and conduct an RFP process without
affording potential bidders access to all the information needed, for example, how a new
facility will produce cash flow, could make it challenging for the City to enter into the well-
informed and negotiated agreements.
It was recommended by these consultants that the City wait until after the renovation is
completed, and the improved facility has been up and running for a year before considering a
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substantive change in maintenance and operating structure. If the City renegotiates the
management services agreement with Lozares for another five years, the City will be aware of
the performance of the new golf course design, have all contracts expire concurrently, and be
better prepared to negotiate management services agreement and/or lease terms and
conditions that will best meet the City’s needs and interests.
These professional consultants further recommended that extending the golf course
maintenance contract with Valley Crest Golf for another five years will also benefit the City. The
independent consultants pointed out how critical it is to have the contracted Golf
Superintendent responsible for maintaining the course involved and present during the
construction of the new course. Having the current Superintendent, who knows and intimately
understands the landscape of the golf course, with a vested interest in the outcome of the
project on hand, will be a tremendous benefit to the City.
3. Lozares Pro Shop Lease and Management Agreement
Mr. Lozares had indicated he would exercise the ten-year extension option on his lease for the
Pro-Shop. If the City were to competitively bid the management services agreement and award
the contract to a firm other than Lozares, that firm would need to negotiate a sublease for a
period of ten years from Lozares, or the new operator would have to negotiate a separate
mobile trailer outside of the Golf Shop leased premises. This is very likely to be a disincentive
for any third party considering a proposal for the management services agreement and would
be cumbersome at best for customer service at the golf course.
Ideally, all four golf course contracts (management services agreement, Pro-Shop lease, Golf
Course maintenance services, and food & beverage services concessions) would be aligned to
concurrently expire. This would create an opportunity for a comprehensive RFP to manage the
entire golf course operation.
The current tax exempt debt represented by the Certificates of Participation, that funded the
1998 Golf Course renovations, restricts the City from entering into a long-term lease agreement
for a firm to manage the entire golf course opera tion. This tax exempt debt is set to expire in
2018. If all of the golf course contracts expire at the same time , the City would have much more
flexibility in issuing a comprehensive RFP to manage the golf course at that time.
Extending the Lozares agreements will also benefit the City, because the City would have a
contractor who is well-respected and trusted by the Palo Alto golf community, which may be
valuable during the transition period associated with the reconfiguration and disruption during
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construction. One of staff’s goals is ramp up play activity as swiftly as possible after
construction is completed, and it is believed the current Golf Pro is in the best position to do so.
In addition, staff believes it would be more effective to issue a compr ehensive golf course RFP
in 2018 when the levee work has been completed and there is no potential for disputes
regarding the Pro-Shop lease and management services agreement to arise.
4. Food and Beverage Service
Food and Beverage service is often a central element of a golf course operation. Since the
current contract for the Bay Café expires on April 30, 2018, it would be advantageous to have
the other contracts expire at the same time to attract more interest in bidding on an RFP that
includes the entire golf course operation.
Discussion
Golf Course Management Services Agreement and Pro Shop Lease
The Community Services and Administrative Services Departments met with Lozares in seven
separate sessions to negotiate the terms of a five-year contract extension for Golf Management
Services and the Pro-Shop lease. As part of the contract extension, Lozares agreed to reduce
the length of the Pro-Shop lease from ten years to five years (expiring in 2018). Given the
pending golf course reconfiguration project, which will require closing the majority of the golf
course, the contract is set up in three distinct phases:
Phase 1: Pre-Golf Course Construction.
Time frame: May 1, 2013 until golf course reconfiguration construction begins (Estimated time
frame for start of construction: April 2014).
Phase I Elements & Background:
Lozares will continue to perform golf management services during Phase I. Mr. Lozares enjoys
an excellent reputation among the local golfing community. His outstanding customer service
helps keep golfers returning to play at Palo Alto. This is especially valuable because of the
uncertainty of the timing of the SFJPA project and golf reconfiguration project, which has
caused some golfers to look elsewhere to book tournament events. City survey cards
consistently illustrate that Lozares’s customer service ranks good to excellent. Fourteen times
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Lozares Golf Shop has been named as one of the top 100 golf shops in the country. He was
named the Golf Professional of the Year by Professional Golf Association in 2001.
Terms of Agreement: (Phase I terms are the same as the existing agreement)
i. Management fee : $345,333 annual (This is the fixed amount that the City pays
to Lozares)
ii. Cart rental revenue: 60% for the City and 40% for Lozares
iii. Driving range revenue: 62% for the City and 38% for Lozares
iv. Green fees: 100% to City
v. Pro-shop rent: $2,000 per month or 4% of gross revenue whichever is higher
The table below shows the estimated compensation using revenue figures from FY12 actuals
and FY13 adopted budget.
Phase I: No Changes to Current Calculation
Contractor Compensation FY2012 Actuals FY2013 Budget
38% of Driving Range Revenue $135,126 $148,200
40% of Cart/Club Rental Revenue $120,490 $148,000
Fixed Fee $345,333 $345,333
TOTAL Estimated $600,949 $641,533
Phase II: During Construction.
Time frame: First day of golf course reconfiguration construction until the reopening of the golf
course (Estimated time frame: April 2014 through April 2015).
Phase II Elements & Background:
During the closure of the golf course or during reconfiguration construction Lozares will
continue to work on future tournament bookings, implementation and marketing of the
renovated Palo Alto Golf Course, provide management and full operation and equipment
for the Driving Range, support the Palo Alto Golf Course web site, respond to golf inquiries,
provide professional services for golf instruction, and broadcast e -mail blasts weekly on the
weekly progress of the course renovation.
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Terms of Agreement:
i. Management fee : $30,500 annual
ii. Range revenue: 15% for the City and 85% for Lozares
iii. Pro-shop rent - $1,500 per month or 4% of gross revenue whichever is higher.
During the slow golf activity months of November, December and January
Lozares will only be required to pay 4% of gross revenue.
iv. There will be no Green fee or cart revenue due to construction work
During this time is it expected that the main source of revenue will be from activity on the
driving range, which is not a part of the reconfiguration project. The contractor will retain some
staff to maintain operations at the range, which includes helping customers, processing
payments, providing golf ball clean up services, and range maintenance. The increased share of
range revenue to the contractor acts as an incentive to encourage activity greater than the
National Golf Foundation’s revenue projections. The table below includes a sensitivity analysis
which shows the potential compensation to the contractor and additional revenue to the City
based on range activity.
Phase II: Increased Share of Range Revenue, Reduced Fixed Fee
NGF Estimate in
Construction
Year (FY14)
35% of FY12
Activity
50% of FY12
Activity
70% of FY12
Activity
Range Revenue Estimate $82,400 $124,458 $177,797 $248,916
Contractor Compensation
85% of Range Revenue $70,040 $105,789 $151,127 $211,578
Fixed Annual Fee $30,500 $30,500 $30,500 $30,500
Total Estimated $100,540 $136,289 $181,627 $242,078
Additional City Revenue $0 $6,309 $14,310 $24,977
Phase III: Post Construction.
Time frame: Reopening of the reconfigured golf course (Estimated time frame: April 2015
through April 30, 2018).
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Phase III Elements & Background:
In addition to ensuring the City is able to cover all operational costs at the Golf Course (including old and
new debt service) and generating a surplus, an important goal of the City’s negotiating team was to
create an agreement that creates a stronger tie between overall golf play activity that benefits the City
(productivity) and provides compensation for the contractor. A primary element of this proposal is the
inclusion of variable compensation based for Green Fees and Play Cards. The inclusion of this new
revenue stream is tied to a reduction in other variable compensation rates for both Driving Range and
Cart Rentals.
Terms of Agreement:
i. Management fee : $300,000 annual
ii. Range revenue: 80% for the City and 20% for Lozares
iii. Cart rental revenue: 80% for the City and 20% Lozares
iv. Green fee revenue: 95% for the City and 5% for Lozares
v. Pro-shop rent: $3,000 per month or 5% of gross revenue whichever is higher
vi. credit card fees to be split between City and Brad according to the agreed
breakdown split of all revenue sources
vii. On-site club rentals and pull cart revenues will be considered as part of the
merchandise revenue from the Pro Shop, which the City receives 5% of the
gross merchandise revenue or $3,000 per month- whichever is greater.
A comparison of the above terms and those in the Phase I category above provides a clear picture of
how the Pro contract will change after the new course opens.
Financial Implications:
The table below is based on the revenue and expense projections modeled by the National Golf
Foundation consultant and presented to Council on July 23, 2012 (Attachment E). Staff has
used NGF’s revenue forecasts and calculated the expected compensation to the Golf Pro based
on the new contractual terms. Compared to the current contract (Phase I contract), staff
estimates savings to the City of at least $50,000 annually.
Phase III: Added Golf Fee to Variable Compensation, Reduced Fixed Fee
NGF Revenue Projections First Year of New
Course
(NGF FY15)
Second Year of
New Course
(NGF FY16)
Last Year of
Contract
(NGF FY17)
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Green Fees $2,341,500 $2,510,600 $2,680,900
Driving Range $353,400 $377,400 $401,900
Cart/Club Rentals
$286,100 $307,300 $353,900
Contractor Compensation
5% of Green Fee Revenue $117,075 $125,530 $134,045
20% of Driving Range Revenue $70,680 $75,480 $80,380
20% of Cart/Club Rental Revenue $57,220 $61,460 $70,780
Fixed Fee $300,000 $300,000 $300,000
TOTAL Estimated $544,975 $562,470 $585,205
The golf course management services contract cost is predicated on the assumption that the
contract phases will have the following durations: Phase I – one year; Phase II – one year; and
Phase III-- three years. The contract cost also includes a 10% contingency. The scheduling of the
golf course reconfiguration and the duration of the phases cannot be determined at this time.
Staff has presented a contract costs based on our best estimate. Depending on how the
reconfiguration schedule changes, staff may need to return to Council with a Budget
Amendment Ordinance.
IRS Requirements
Because the Golf Course has been previously funded by publicly financed bonds, the City must
adhere to IRS tax regulations that concern the compensation structure for Golf Management
contracts. The variable compensation (based on revenue) portion must not exceed the amount
that is provided by the fixed fee. The requirements do allow for a two-year period during
closure or renovations for the compensation to be developed outside of the traditional
structure, which the City has utilized in the Phase II component. The Administrative Services
Department consulted with bond counsel and has confirmed that the planned agreement
meets the requirements of the Internal Revenue Code of 1986, as amended.
Golf Maintenance Agreement
The Community Services and Administrative Services Departments met with Valley Crest Golf
numerous times to negotiate the terms of a five-year contract extension for the Golf Course
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Maintenance at the Palo Alto Golf Course. Since Valley Crest Golf has very successfully
maintained the golf course for the past two and one-half years, significant improvements have
taken place. Sustaining Valley Crest’s excellent maintenance service throughout the completion
of the golf course reconfiguration, and the period of time after the new course opens and a
new level of business stabilizes, will be valuable to the City. Valley Crest staff has intimate
knowledge of the difficult irrigation system and how to keep it functioning until replacement,
water management specific to this unique environment, drainage, growing conditions, sensitive
wildlife habitat, and wetland areas. Valley Crest has established good working relationships
throughout the City, which will all be beneficial during the reconfiguration project. Its staff has
participated in all the meetings with the SFCJPA and the planning process for the
reconfiguration of the golf course. It has provided agronomic and environmental expertise
when needed.
Given the pending golf course reconfiguration project, which will require closing the majority of
the golf course for approximately one year, the contract is set up in three phases :
Phase I: Pre-golf course construction.
Time frame: May 1, 2013 until golf course reconfiguration construction begins (Estimated to be
April 2014).
Phase I Elements & Background:
Valley Crest will continue to perform the same golf maintenance services during Phase I as they
did in the pervious contract. City staff has received numerous customer compliments regarding
the service Valley Crest provides.
Terms of Agreement: (Phase I terms are the same as the existing agreement)
i. Annual fee of $750,000
Total anticipated costs for Phase I = $750,000
Financial Implications:
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The last two years of the previous Golf Course Maintenance contract also had an annual fee of
$750,000.
Phase II: During Construction.
Time frame: First day of golf course reconfiguration construction until the reopening of the golf
course. Anticipated duration of Phase II is one year.
Phase II Elements & Background:
During the closure of the golf course, Valley Crest will continue maintaining the putting
green and associated irrigation, driving range, landscaping around the parking lot/Pro-Shop,
and general site safety and aesthetics. The Valley Crest Golf Superintendent will also be on -
site daily to monitor, serve as a consultant on the reconfiguration project, and document
the irrigation construction which will improve response times to future irrigation issues.
Valley Crest will also be responsible for caring for the newly established natural turf after it
is ready for mowing, which is referred to as the grow-in process (prior to the opening of the
new course). The grow-in period requires frequent fertilizing and adding other
amendments, along with higher maintenance to ensure that the new turf is properly
established.
Terms of Agreement:
I. Monthly fee $18,158 for first 7 months of phase II.
ii. Five month grow-in period: $415,000 (lump sum)
Total anticipated costs for Phase II = $542,106
Phase III: Post Construction.
Time frame: Reopening of the reconfigured golf course through April 30, 2018.
Phase III Elements & Background:
One of the main goals of the City’s negotiating team was to ensure that the City controlled
maintenance costs while at the same time made improvements in the level of service to reflect
the investment in the new and improved golf course.
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For several years Canada geese and the feces they produce have been the number one
complaint about the Palo Alto Golf Course. The most effective technique to address the goose
loitering problem has been the use of specially trained herding dogs. At a cost of approximately
$20,000 per year, the City has contracted with a private company that brings trained dogs to
the course to encourage the geese to leave or migrate. In this new contract, Valley Crest will be
required to have their own trained dog on-site.
The second most common complaint at the golf course has been ground squirrels and the holes
and tunnels they produce. The new contract will provide for on-going rodent control consistent
with the City’s Integrated Pest Management (IPM) Policy.
In addition, Valley Crest will also be purchasing new maintenance equipment, some specifically
specified by the City which will provide improved quality course conditions. Valley Crest will
also be responsible for maintaining lower weed thresholds at the golf course.
Terms of Agreement:
I. Annual fee: $796,262 (Initial yearly/monthly pricing shall be fixed for the first 18
months thereafter CPI (Consumer Price Index for all Urban Consumers – San
Jose/Sunnyvale/Santa Clara) will be applied on a yearly basis. CPI approximately
1.34%.
Year 1= 796,262
Year 2= 801,597
Year 3= 812,338
Total anticipated costs for Phase III= $2,410,197.
Total costs for all three phases of Valley Crest Golf maintenance contract is $3,702,303 plus
10% contingency = $4,072,533
The golf course maintenance contract cost is predicated on the assumption that the contract
phases will have the following durations: Phase I – one year, Phase II – one year, and Phase III--
three years. It also includes a 10% contingency. The scheduling of the golf cour se
reconfiguration and the duration of the phases is uncertain. Staff has presented a contract costs
based on our best estimate. Depending on how the reconfiguration schedule changes staff may
need to return to Council with a Budget Amendment Ordinance.
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Resource Impact
The Fiscal Year 2013 Adopted Budget shows an overall net income to the City for the Golf
Course Operations of $271,745. For Phase I of the Lozares contract, this is estimated to remain
the same as the terms of the contract will not change. As well, the maintenance and
professional contracts discussed in this report have been formulated to account for reduced
activity during construction periods.
For the construction period of the course, there will be no green fee or cart rental revenue. It is
also anticipated that there will be a decrease in range revenue. The National Golf Foundation
projected a 77% decrease in Range revenue; however, through the inclusion of revenue
incentives in the Lozares contract, the City is hopeful that the contract or will be able to diminish
the impact on range activity.
Looking ahead to the reopening of the course, City Staff were able to negotiate contracts below
National Golf Foundations expenditure projections. Attachment F provides an update to the
original NGF projections for the new course with the negotiated contract terms. The estimated
annual savings to the City as a result of contract negotiations is between $50,538 to $107,895
for a total of $661,127 over the first seven years of the new golf course.
It is important to note that the SFCJPA creek flood protection project and City Golf Course
construction start dates and timelines have not been finalized at this time. Currently, the Office
of Management and Budget is projecting budget figures for a closu re of the course in spring of
2014.
In addition, the speedy completion of construction is key to minimizing the impact on the
general fund operating budget. NGF projected that the new course would generate
approximately $251,708 gross revenues each month in the first year. The potential loss of this
revenue with fixed maintenance and operational costs in place will cause the impact on the
general fund to grow with each additional month of closure.
If the course reconfiguration timeline is changed, staff will submit a Budget Amendment
Ordinance to Council to account for the impact of any changes may have to the operating
budget.
Policy Implications
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The project is consistent with Policy C-26 of the Comprehensive Plan, which encourages
maintaining and enhancing existing park facilities.
Attachments:
Attachment A: Brad Lozares five-year contract extension (DOC)
Attachment B: Valley Crest 5-year contract extension (PDF)
Attachment C: Golf Maintenance contract Oct 2010- Valley Crest Golf (PDF)
Attachment D: Golf Course Management Services Contract Dec 2010- Lozares (PDF)
Attachment E: Golf NGF Report April 2012 (PDF)
Attachment F_NGF Option G Updated with Contract Costs (PDF)
Attachment A
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AMENDMENT NO. 6 TO MANAGEMENT AGREEMENT
C3151541A, BETWEEN THE CITY OF PALO ALTO AND BRAD
LOZARES GOLF SHOP FOR PROFESSIONAL SERVICES AT 1875
EMBARCADERO ROAD, PALO ALTO
THIS AMENDMENT NO.6 to the Management Agreement C3151541A,
between the City of Palo Alto and Brad Lozares Golf Shop for Professional Services at
the Palo Alto Municipal Golf Course, (“Agreement,”) is made and entered into this 25th
day of February, 2013, by and between the City of Palo Alto, a municipal corporation
(the “CITY”) and Brad Lozares Golf Shop, a sole proprietorship(“GOLF
PROFESSIONAL”).
RECITALS
A. GOLF PROFESSIONAL has assumed responsibility for and continued the
operation and management of course play for the Golf Course facility on behalf of
the CITY on the terms and conditions more particularly set forth in the
Management Agreement dated January 28, 2003.
B. On May 15, 2006, the parties amended the Agreement to extend the term
December 31, 2007, and to increase the fixed fee to $27,660.25 per month and
reimburse GOLF PROFESSIONAL for sixty percent (60%) of finance charges
associated with the payment of service charges for golf carts by credit card.
C. On May 15, 2007, the parties amended the Agreement to extend the term to
December 31, 2008, and to increase the fixed fee to $28,213.46 per month.
D. On October 20, 2008, the parties amended the Agreement to extend the term to
December 31, 2009, and to increase the fixed fee to $28,777.73 per month.
E. On December 7, 2009 the parties amended the Agreement to extend the term for
one year to December 31, 2010 at the same fixed level of compensation
established in 2008 of $28,777.73 per month.
F. On December 7, 2010 the parties amended the Agreement to extend the term for
three years to April 30, 2013 at the same fixed level of compensation established
in 2008 of $28,777.73 per month.
G. The parties now wish to amend the Agreement (1) to extend the term of the
agreement to April 30, 2018, (2) maintain at the same fixed level of compensation
as established in 2008 of $28,777.73 per month, until such time as the CITY
provides GOLF PROFESSIONAL, at least sixty (60) days in advance, written
notice as to the exact date the Golf Course Construction/Reconfiguration is
commencing; and (3) upon the first effective day of Golf Course closure, the
fixed compensation shall adjust according to Section 2 of this amendment.
Attachment A
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NOW, THEREFORE, in consideration of the terms, conditions, and
provisions of this Amendment, the parties agree as follows:
SECTION 1. Section III (“Term”) is amended in its entirety to read, as follows:
“III. TERM
The term of this Agreement shall commence on January 28 2003 and end on April
30, 2018.
SECTION 2. Section IV, A (“Compensation”), is amended in its entirety to read,
as follows:
“IV. COMPENSATION
Pre-Construction:
During the Pre-Construction term of the Agreement, from April 30, 2013
until Golf Course Construction/Reconfiguration Commences, GOLF
PROFESSIONAL shall receive a fixed fee and percentage fees as defined
below (collectively the “Management Fee” PHASE I).
A. Fixed Fee
GOLF PROFESSIONAL shall receive a fixed fee during the term of April
30, 2013 until the Golf Course Construction/Reconfiguration commences
(reffered to as PHASE I). The fixed fee shall be for GOLF
PROFESSIONAL’s Golf Course and driving range management, Golf
Course marshaling and starting and cart rental services. The fixed fee for
this term of this agreement will be $345,333 annually. The fixed fee will
be paid in equal monthly installments.
The CITY shall forward the fixed fee by the 5th working day of
the CITY’s working month for the amount due for that month to
the GOLF PROFESSIONAL. If not received within ten calendar
days after the fifth working day of the month, a late charge of one
percent of monthly payment due and unpaid plus an administrative
fee of $45.00 shall be added to the payment due and unpaid, and
the total monthly sum shall become immediately due and payable
to GOLF PROFESSIONAL. The parties agree that such late
charges represent a fair and reasonable estimate of the costs that
GOLF PROFESSIONAL will incur by reason of the CITY’s late
payments and that acceptance of such late charges in no event
constitutes a waiver of the CITY’s default with respect to such
Attachment A
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3
overdue payment, nor prevents GOLF PROFESSIONAL from
exercising any of the other rights and remedies granted hereunder
or by any provision of law.”
B. Percentage Fees
In addition to the fixed fee, GOLF PROFESSIONAL shall receive
38% percent of the gross revenues of the driving range and retain
40% of the gross revenue of the golf carts, golf club and pull cart
rentals. Percentage fees for each month will be calculated and paid
no later than the 10th day of the following month. In no event,
however, shall the cumulative percentage fees paid to GOLF
PROFESSIONAL for a single calendar year exceed the total fixed
fee payments described in section IV-A herein for that same
calendar year.
C. Golf Cart Fuel Reimbursement
GOLF PROFESSIONAL shall reimburse the CITY quarterly for
fuel supplied to gas golf carts. Reimbursement shall be at the
current retail full service pump price on the date of billing for
unleaded fuel, determined quarterly by the CITY. GOLF
PROFESSIONAL shall reimburse the CITY by no later than by the
20th day of the month following the close of
each quarter.
Productivity Reward (Incentives)
In order to enhance overall golf division business incomes,
customer service and golf professional revenues, a productivity
reward equal to a stated dollar amount based on increases of golf
rounds, gross power golf cart rentals and driving range sales
becomes effective with this agreement. In addition to the fixed and
percentage fees, the golf professional shall receive the following
productivity rewards based on exceeding the following baseline
golf rounds and gross sales:
PAID GOLF ROUNDS: (FEE, DISCOUNT CARD & REPLAY ROUNDS)
* Greater than 72,000 rounds $3.00 PER ROUND
POWER GOLF CART RENTALS:
* Greater than $300,000 $100 PER $1,000 INCREASE
DRIVING RANGE SALES:
* Greater than $400,000. $200 PER $1,000 INCREASE
Attachment A
091120 jb 0073262
4
During Construction:
During the Construction term of the Agreement, from the first
effective day of Golf Course closure until the Golf Course Golf Course
Construction/Reconfiguration is completed, GOLF PROFESSIONAL
shall receive a fixed fee and percentage fees as defined below (collectively
the “Management Fee” Phase II).
A. Fixed Fee
GOLF PROFESSIONAL shall receive a fixed fee during the term of the
Golf Course Construction/Reconfiguration. The fixed fee shall be for
GOLF PROFESSIONAL’s Golf Course and driving range management,.
The fixed fee for this term of this agreement will be $30,500 annually. The
fixed fee will be paid in equal monthly installments.
The CITY shall forward the fixed fee by the 5th working day of
the CITY’s working month for the amount due for that month to
the GOLF PROFESSIONAL. If not received within ten calendar
days after the fifth working day of the month, a late charge of one
percent of monthly payment due and unpaid plus an administrative
fee of $45.00 shall be added to the payment due and unpaid, and
the total monthly sum shall become immediately due and payable
to GOLF PROFESSIONAL. The parties agree that such late
charges represent a fair and reasonable estimate of the costs that
GOLF PROFESSIONAL will incur by reason of the CITY’s late
payments and that acceptance of such late charges in no event
constitutes a waiver of the CITY’s default with respect to such
overdue payment, nor prevents GOLF PROFESSIONAL from
exercising any of the other rights and remedies granted hereunder
or by any provision of law.
B. Percentage Fees
In addition to the fixed fee, GOLF PROFESSIONAL shall receive 85%
percent of the gross revenues of the driving range. Percentage fees for
each onth will be calculated and paid no later than the 10th day of the
following month.
C. Golf Cart Fuel Reimbursement
GOLF PROFESSIONAL shall reimburse the CITY quarterly for
fuel supplied to gas golf carts. Reimbursement shall be at the
current retail full service pump price on the date of billing for
unleaded fuel, determined quarterly by the CITY. GOLF
PROFESSIONAL shall reimburse the CITY by no later than by the
20th day of the month following the close of
each quarter.
Attachment A
091120 jb 0073262
5
Attachment A
091120 jb 0073262
6
Post Construction:
During the Post Construction term of the Agreement, from the
first effective date the Golf Course reopens until the date this
Agreement expires, April 30, 2018, GOLF PROFESSIONAL shall
receive a fixed fee and percentage fees as defined below (collectively the
“Management Fee” Phase III).
A. Fixed Fee
GOLF PROFESSIONAL shall receive a fixed fee during the remainder of
the term of this Agreement (Phase III). The fixed fee shall be for GOLF
PROFESSIONAL’s Golf Course and driving range management, Golf
Course marshaling and starting and cart rental services. The fixed fee for
this term of this agreement will be $300,000 annually. The fixed fee will
be paid in equal monthly installments.
The CITY shall forward the fixed fee by the 5th working day of
the CITY’s working month for the amount due for that month to
the GOLF PROFESSIONAL. If not received within ten calendar
days after the fifth working day of the month, a late charge of one
percent of monthly payment due and unpaid plus an administrative
fee of $45.00 shall be added to the payment due and unpaid, and
the total monthly sum shall become immediately due and payable
to GOLF PROFESSIONAL. The parties agree that such late
charges represent a fair and reasonable estimate of the costs that
GOLF PROFESSIONAL will incur by reason of the CITY’s late
payments and that acceptance of such late charges in no event
constitutes a waiver of the CITY’s default with respect to such
overdue payment, nor prevents GOLF PROFESSIONAL from
exercising any of the other rights and remedies granted hereunder
or by any provision of law.
B. Percentage Fees
In addition to the fixed fee, GOLF PROFESSIONAL shall receive
20% percent of the gross revenues of the driving range and retain
20% percent of the gross revenue of the golf cartsand 5% percent
of the Green Fees. Percentage fees for each month will be
calculated and paid no later than the 10th day of the following
month. In no event, however, shall the cumulative percentage fees
paid to GOLF PROFESSIONAL for a single calendar year exceed
the total fixed fee payments described in section IV-A herein for
that same calendar year.
C. Golf Cart Fuel Reimbursement
Attachment A
091120 jb 0073262
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GOLF PROFESSIONAL shall reimburse the CITY quarterly for
fuel supplied to gas golf carts. Reimbursement shall be at the
current retail full service pump price on the date of billing for
unleaded fuel, determined quarterly by the CITY. GOLF
PROFESSIONAL shall reimburse the CITY by no later than by the
20th day of the month following the close of
each quarter.
Productivity Reward (Incentives)
In order to enhance overall golf division business incomes,
customer service and golf professional revenues, a productivity
reward equal to a stated dollar amount based on increases of golf
rounds, gross power golf cart rentals and driving range sales
becomes effective with this agreement. In addition to the fixed and
percentage fees, the golf professional shall receive the following
productivity rewards based on exceeding the following baseline
golf rounds and gross sales:
PAID GOLF ROUNDS: (FEE, DISCOUNT CARD & REPLAY ROUNDS)
* Greater than 72,000 rounds $3.00 PER ROUND
POWER GOLF CART RENTALS:
* Greater than $300,000 $100 PER $1,000 INCREASE
DRIVING RANGE SALES:
* Greater than $400,000. $200 PER $1,000 INCREASE”
Attachment A
091120 jb 0073262
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SECTION 4 Except as herein modified, all other provisions of the Agreement,
including any exhibits and subsequent amendments thereto, shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment No 6 to Management Agreement on the date first written above.
CITY OF PALO ALTO
____________________________
City Manager
APPROVED AS TO FORM:
__________________________
Senior Asst. City Attorney
BRAD LOZARES GOLF SHOP
By:___________________________
Name:_________________________
Title:________________________
1 Revision July 25, 2012
AMENDMENT NO. 1 TO CONTRACT NO. C11136681
BETWEEN THE CITY OF PALO ALTO AND
VALLEYCREST GOLF COURSE MAINTENANCE, INC
This Amendment No. 1 to Contract No. C11136681 (“Contract”) is entered into
February , 2013, by and between the CITY OF PALO ALTO, a California chartered municipal
corporation (“CITY”), and VALLEYCREST GOLF COURSE MAINTENANCE, INC, a
California corporation, located at 24151 Ventura Blvd., Calabasas, California 91302, Telephone
Number (818) 737-3100 (“CONTRACTOR”).
R E C I T A L S:
WHEREAS, the Contract was entered into between the parties for the provision
of golf course maintenance services; and
WHEREAS, the parties wish to amend the Contract;
NOW, THEREFORE, in consideration of the covenants, terms, conditions, and
provisions of this Amendment, the parties agree:
SECTION 1. Section 3 is hereby amended to read as follows:
“3. TERM.
The term of this Agreement (the “Term”) begins on November 1, 2010 and ends on April
30, 2018, subject to earlier termination by a Party and further is subject to the provisions
of Sections Q and V of the General Terms and Conditions. The Term does not include
any period of time after April 30, 2018, which may be the subject of the renewal of this
Agreement or any other contract relating to golf course maintenance services between the
Parties.”
SECTION 2. Section 5 is hereby amended to read as follows:
“5. COMPENSATION FOR ORIGINAL TERM. The City shall pay the Contractor, and the
Contractor shall accept, a not-to-exceed compensation for the full performance of the Services and
reimbursable expenses, if any:
The total maximum lump sum compensation of dollars ($ ); OR
The sum of dollars ($ ) per hour, not to exceed a total maximum compensation
amount of dollars ($ ); OR
A sum calculated in accordance with Exhibit “C” Schedule of Fees, not to exceed a total
maximum compensation amount of Seven Hundred Fifty Thousand Dollars Per Year ($750.00.00
Per Year) until May 1, 2014 upon which CPI pricing will be applied. When the CITY provides the
CONTRACTOR with a written notice that the Golf Course Reconstruction has commenced,
compensation shall not exceed the amount of Five Hundred Forty Two Thousand One Hundred
Six Dollars ($542,106.00 Per Year). In the event of an overlap with Reconfiguration Construction
and Grow-In, an additional maintenance fee of Eighteen Thousand One Hundred Fifty Eight
Attachment B
2 Revision July 25, 2012
Dollars ($ 18,158.00) per month may apply. Post Construction annual compensation shall be in
the amount of Seven Hundred Ninety Six Thousand Two Hundred Sixty Two Dollars Per Year
($796,262.00 Per Year) for the first 18 months, thereafter the compensation shall be adjusted
annually according to the CPI referenced in this Agreement. Post construction compensation shall
begin after the CITY provides CONTRACTOR with written notice that the Golf Course
Reconstruction has been completed.
The Contractor covenants and agrees that it can perform the Services for an amount not to exceed the total
maximum compensation set forth in this Agreement, including Exhibit “C”. Any hours worked or Services
performed by the Contractor, for which payment would result in a sum total exceeding the maximum
amount of compensation set forth in this Agreement for performance of the Services, shall be performed at
no additional cost to the City, except as expressly provided in this Agreement. The Contractor
acknowledges that the City has informed it that the current Palo Alto municipal golf course (the “Golf
Course”) configurations could be changed or re-designed after the Effective Date, and that the City’s
collaboration with the San Francisquito Creek Joint Powers Authority (the “JPA”) to implement any
reasonably necessary flood control measures with respect to the San Francisquito Creek, which lies
adjacent to the Golf Course, could result in the temporary closure of one or more areas of the Golf Course
and, consequently, could affect on a temporary or periodic basis the Contractor’s duties and obligation to
perform the Services hereunder. In that event, the Parties shall in good faith timely negotiate an adjustment
to the Services, including, without limitation, the compensation otherwise payable to the Contractor, as set
forth in this Agreement, in order to reflect any changes, including, without limitation, modifications to the
scope of the Services.
The City has set aside the sum of Three Hundred Ninety Eight Thousand One Hundred Thirty One
Dollars ($398,131.00) for the Contractor’s performance of Additional Services, if any may be
required to be performed by the Contractor. The Contractor shall provide any Additional Services
only after receipt of the prior written authorization of the City Manager or designee. Thereafter,
the Contractor, at the City’s request, shall submit a detailed written proposal, including a
description of the Additional Services’ scope of services, schedule, level of effort, and the
maximum compensation, including reimbursable expenses. Such compensation shall be based on
the hourly rates set forth in Exhibit “C” or, if such rates are not applicable, a negotiated lump sum.
The City shall not authorize, and the Contractor shall not perform, any Additional Services, for
which any payment would cause the total sum compensation for Additional Services to exceed the
amount of $398,131.00. Payments for Additional Services shall be subject to in the provisions of
this Agreement.
SECTION 3. The following exhibit(s) to the Contract is/are hereby amended to
read as set forth in the attachment(s) to this Amendment, which are incorporated in full by this
reference:
a. Exhibit “A” entitled “Scope of Services”.
b. Exhibit “C” entitled “Schedule of Fees”.
c. Exhibit “H” entitled “ValleyCrest Golf Course Maintenance Grow-In
Overview”.
SECTION 4. Except as herein modified, all other provisions of the Contract,
including any exhibits and subsequent amendments thereto, shall remain in full force and effect.
Attachment B
3 Revision July 25, 2012
IN WITNESS WHEREOF, the parties have by their duly authorized
representatives executed this Amendment on the date first above written.
CITY OF PALO ALTO
____________________________
City Manager
APPROVED AS TO FORM:
_____________________________
Senior Asst. City Attorney
VALLEYCREST GOLF COURSE
MAINTENANCE, INC
By:___________________________
Name:_________________________
Title:________________________
Attachments:
EXHIBIT "A": SCOPE OF SERVICES
EXHIBIT "C": SCHEDULE OF FEES
EXHIBIT "H": VALLEYCREST GOLF COURSE MAINTENANCE GROW-IN
OVERVIEW
Attachment B
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EXHIBIT “A”
SCOPE OF SERVICES
SPECIFICATIONS & REQUIREMENTS
Contract No. C11136681
GOLF COURSE MAINTENANCE PROJECT
Specifications for the Services to be provided by the Contractor
of the Golf Course:
I. SCOPE OF WORK- Golf Course Maintenance
The Contractor shall provide the highest quality of Golf Course maintenance
services and materials. The Contractor agrees to provide the highest quality
commercially accepted methods, procedures and scientific controls for Golf
Course maintenance. The term "scientific controls" means the practices based
upon the recommendations of the University of California, the U.S. Forest
Service, or similarly qualified experts, and the recommendations set forth in the
University of California Cooperative Extension Publications, the Consumer
Products Safety Commission Playground Guidelines and information in standard
landscape industry references. The obligations set forth herein shall include the
use of proper knowledge, skills, materials and equipment of a timely basis to
maintain all areas in a clean, safe, healthy, and aesthetically acceptable manner
during the Term.
The Contractor agrees to be continuously alert in locating and defining problems
and agrees to exercise prompt and proper corrective action. Action times will be
prioritized, and low priority items will be given a time line for corrections. A
PRELIMINARY WRITTEN REPORT SHALL BE SUBMITTED FOR MAJOR
CORRECTIVE PROBLEMS NOT COVERED IN THE AGREEMENT. The
Contractor shall communicate to the City ALL hazards that are seen while on
site.
II. GOLF COURSE MAINTENANCE SERVICES SPECIFICATIONS
1.0 GENERAL REQUIREMENTS
The following specifications shall apply to the Golf Course.
The Contractor shall furnish all labor, equipment, materials, tools, services and
special skills required to perform the Services as set forth in these specifications
and in keeping with the highest industry standards of quality and performance.
NOTE: Any and all references to the role or duties of the Golf Services Manager
(GSM) in this Agreement shall not be deemed or construed to relieve the
Contractor of any duty or obligation to maintain the Golf Course in conformance
to the specifications of Exhibit “A”.
Attachment B
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1.1 SAFETY
1.1.1 The Contractor shall perform all work outlined in these specifications in
such a manner as to meet all accepted standards for safe practices
during the maintenance and operation and to safely maintain equipment,
machines, and materials or other hazards consequential or related to the
work; and agrees additionally to accept the sole responsibility for
complying with all local, County, State or other legal requirements,
including, but not limited to, full compliance with the terms of the
applicable OSHA and CAL OSHA Safety Orders, and at all times
protecting all persons, including the Contractor’s employees, vendors,
members of the public or others from foreseeable injury or damage to their
property. On and after the Effective Date, the Contractor shall identify and
inspect all potential hazards existing or subsequently occurring at the Site
and the Facilities, and shall create and maintain a written log, indicating
the dates of inspection and actions taken.
1.1.2 The Contractor shall ensure that all required certifications and training
methods are adhered to and current. Evidence of the same shall be
maintained at the Site or as otherwise approved by the City.
1.1.3 For the safety of the general public at the Golf Course and the Palo Alto
airport and its employees, agents, representatives, contractors and
subcontractors, the Contractor shall adhere to the appropriate handling
and use requirements for hazardous materials, pesticides, chemicals and
fungicides used in connection with the rendering of the Services. The use
of the aforementioned items will require proper certification of applicators,
evidence of which shall be maintained at the Site or as otherwise
approved by the City. Notices will be prominently posted in public areas
for the use of hazardous chemicals or pesticides.
1.1.4 When its employees are performing the Services, the Contractor shall
make every effort to keep sidewalks, vehicle travel lanes and driveways
open and unobstructed at all times, and shall honor standard golf etiquette
by performing maintenance tasks within acceptable golf play conditions.
1.1.5 The Contractor shall inspect and identify any condition(s) that renders
unsafe any portion of the areas of the Golf Course or the Site under its
care and maintenance, as well as any unsafe practices occurring thereon.
The Contractor shall notify the GSM immediately upon the discovery or
knowledge of the existence of any unsafe condition that will require
remedial action, attention or other appropriate correction. The Contractor
shall be responsible for making corrections, including, but not limited to,
filling holes and replacing valve box covers so as to protect golfers and
other members of the public from injury. The Contractor shall cooperate
fully with the City in the investigation of any accidental injury or death by
the public, the Contractor’s employees, agents, representatives, contractor
Attachment B
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and subcontractors as well as by any other entity present or occurring in at
the Golf Course or the Site, including a complete written report thereof to
the GSM within twenty-four (24) hours following the occurrence of such
event.
1.2 PROTECTION OF PROPERTY
1.2.1 During Periods of Inclement Weather:
The Contractor will provide supervisory inspection of the Golf Course
during regular hours to prevent or minimize possible damage. The
Contractor shall submit a report identifying any storm damage to the GSM,
which shall be attached to a site map that identifies the location of
damage. The Contractor’s employees shall continue to perform the
Services that are or will not be affected by such inclement weather (e.g.,
clean-up and facility maintenance, as well as work caused by the
inclement weather).
1.2.2 The Contractor shall exercise due care during the performance of the
Services in protecting from damage all existing facilities, structures and
utilities, including both aboveground and underground City property. Any
damage to the City’s property that is determined to be caused by the
Contractor’s act or omission shall be corrected and paid for by the
Contractor, upon request, at no cost to the City.
1.2.3 If the City requests or directs the Contractor to perform Services work in a
specified area, then the Contractor shall be responsible for verifying and
locating (and marking by USA) any underground utility systems and for
taking reasonable precautions whenever its employees are or will be
working in these areas. Any damage or problems shall be reported
immediately to the GSM.
1.3 INTEGRATED PEST MANAGEMENT.
1.3.1 The Contractor shall satisfy and otherwise comply with the following IPM
provisions:
a. The Contractor must work closely with the GSM and the City’s IPM
Coordinator (the “IPMC”) to achieve annual IPM goals which strive
to reduce the amount and toxicity of pesticides that are used while
maintaining the health and aesthetics of the Golf Course. The
Contractor must attend annually City IPM meeting, coordinate with
the IPMC on annual goals, and meet quarterly to track progress on
annual goals and troubleshoot IPM problems and respond to public
requests.
b. Within thirty (30) days of the Effective Date and annually on the
anniversary date (November 1st or as otherwise specified) of this
Agreement, the Contractor shall submit to the GSM and the IPMC,
Attachment B
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an Integrated Management Plan (the “Plan”) that complies with the
City’s IPM Policy. The Plan shall be reviewed annually for currency
updates and modifications. Frequent and thorough site inspections
on foot will be needed to ensure no major fungal or insect
infestations shall occur.
c. Fungicides, insecticides and herbicides will be approved prior to
use by the GSM with IPMC consultation. New pesticides may not
be used without the GSM’s prior written authorization. Pesticides
will be selected in accordance with the City’s goal to minimize the
use of ecotoxic “Tier 1” pesticides and the total amount of
pesticides (active ingredient) as defined in the City’s annual pest
report.
d. The Contractor must maintain any pre-existing IPM strategies used
at the Golf Course, unless it is otherwise determined by the GSA in
consultation with the IPMC.
e. The Contractor acknowledges that the City believes and is informed
that the reduction in use of Tier 1 fungicides at the Golf Course has
been a key component of the reduction of pesticide toxicity at the
Golf Course. Whenever the use of fungicides is deemed necessary
by the Contractor, Tier 2 fungicide use shall be maximized prior to
the Contractor’s use of Tier 1 fungicides. If Tier 1 fungicides must
be used, then Tier 1 fungicides that are not ecotoxic (a subset of
Tier 1 pesticides) must be used first. Attachment 3 contains a list of
current fungicides that are used, which includes the preferred Tier 2
products. The City’s Environmental Compliance Program will
provide technical assistance in determining product toxicity and Tier
rankings.
f. The City reserves the right to disallow and otherwise prohibit the
Contractor from using any pest control measure that the City
determines may jeopardize the public health, safety and welfare at
the Golf Course or threaten the environment or which conflicts with
the intention of the City’s IPM policy.
g. Rodent control will be performed by trapping. Baiting or fumigant
use is prohibited unless authorized by the GSM in consultation with
the IPMC. Trapping will be performed using devices that are
preapproved by GSM using humane trapping procedures in order
to minimize stress or animal discomfort.
h. For insect or other invertebrate control in, on or about the Golf
Course, Golf Course buildings and other structures, the
Contractor’s first priority will be to address conditions that are
conducive to insect pests’ infestation and conserve naturally
beneficial insects (or other invertebrates). Selective applications of
Attachment B
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the least-toxic pesticides may be used only when non-chemical
control measures have been exhausted. The following products
shall not be used for insect control:
i. Products labeled with the signal word “danger”
ii. Organophosphate products (e.g.,diazinon or
chlopyrifos)
iii. Carbamate products (e.g., carbaryl)
iv. Pyrethroid-containing products
Biological controls will be based upon sound information such as
that provided by the University of California. The CSD staff will
provide site-specific historical data for known infestations.
i. The Contractor must provide regular pesticide reporting information
in electronic format using the City’s Contractor’s Pesticide
Application Form (Attachment 2) and to be emailed to the GSM and
the IPMC by the 15th day of each month for the previous month’s
work, unless it is otherwise agreed to and approved by the IPMC.
The Contractor must also have internet access and the ability to
enter pesticide use information online if the City provides that
reporting mechanism.
j. For the City’s Annual Pest Management and IPM Report, the
Contractor must also provide information confirming appropriate
training of staff, an annual inventory of hazardous materials and
hazardous wastes to ensure expired or prohibited products are
appropriately disposed and a written summary of the challenges
and successes of IPM program efforts annually. The brief report
format (Attachment 2) shall be provided by the City, and shall be
due to the IPMC by December 31 of each year.
k. In accordance with the City’s shared Municipal Regional Storm
water permit, IPM training must be provided to the Contractor’s staff
at a minimum of once every three (3) years, or at a minimum of one
time during the Term, as shall be established by the GSM.
l. Requests for information from the GSM or IPMC must be
responded to within 48 hours.
All materials used shall be in strict accordance with and applied within the
standards set forth in the EPA regulations and the California Food and
Agricultural Code.
The Contractor is responsible for obtaining all required permits and maintaining
the required usage documentation and to comply with all requests from the Santa
Clara County Agricultural Department to inspect records, licenses, training
certificates, equipment and storage facilities. All applicable regulations shall be
Attachment B
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strictly adhered to, and all required reporting shall be the responsibility of the
Contractor.
1.3.2 Pesticide Application Timing: Pesticides shall be applied at times that limit
the possibility of contamination from weather, irrigation or other factors.
Early morning or evening application shall be used when possible to avoid
contamination from drift. If applicable, drift control skirted booms must be
used when golfers are present if applicable. Small backpack applications
may be performed based on weather protection and with provisions made
for the safety of golfers. The applicator shall monitor and forecast weather
conditions to avoid making application prior to the occurrence of inclement
weather in order to eliminate the potential for the runoff of treated areas.
Irrigation water applied after treatment shall be reduced to eliminate
runoff. Whenever water shall be required to increase pesticide efficiency, it
shall be applied only in quantities specified on the label requirements and
of which each area is capable of receiving without excessive runoff.
1.3.3 Handling of Pesticides: Care shall be taken in transferring and mixing
pesticides to prevent contaminating areas outside the target area.
Application methods shall be used which ensure that materials are
confined to the target area. Spray tanks containing leftover materials shall
not be drained on or about the Site to prevent contamination. Disposal of
pesticides and tank-rinsing materials shall be handled in accordance with
the guidelines established in the California Department of Food and
Agricultural Code and/or EPA regulations, whichever imposes the higher
duty of care on the Contractor.
1.3.4 Equipment and Methods: Spray equipment shall be in good operating
condition, quality, and design to efficiently apply material to the target
area. The Contractor shall avoid the use of high pressure applications,
but it will be permitted to use water soluble drift agents that will minimize
drift.
1.3.5 Recommendations: All pesticide applications shall be made in
accordance with written recommendations provided by a licensed Pest
Control Advisor (PCA); a copy of each written recommendation of the PCA
will send to the GSM. A licensed Qualified Applicator (who possesses a
Qualified Applicator Certificate) shall be kept at the Site during application.
1.3.6 Selection of Materials: Pesticides shall be selected from those approved
for golf course use by California Department of Food and Agriculture and
in compliance with Section 1.3, which lists the prohibited pesticides.
1.4 SOUND CONTROL REQUIREMENTS
1.4.1 The Contractor shall comply with all local sound control and noise level
rules, regulations and ordinances, which apply to any work performed
pursuant to the contract.
Attachment B
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1.4.2 Each internal combustion engine used for any purpose on the job or
related to the job shall be equipped with a muffler of a type recommended
by the manufacturer of such equipment. No internal combustion engine
shall be operated on the project without said muffler.
1.5 EQUIPMENT AND ACCESSORIES
1.5.1 The Contractor shall provide all necessary equipment needed to perform
the Services as set forth in this Exhibit “A”.
1.5.2 As of the Effective Date, the Contractor shall purchase from the City the
equipment, listed in Attachment A, in the “as-is”, “where-is” condition in the
amount of $125,000, which sum shall be paid to the City on or before the
Effective Date. The Contractor will assume all rights and obligations
relating to the equipment as of the Effective Date. To the extent that the
City will require the Contractor to execute a bill of sale for such equipment,
the Contractor will execute and deliver the same promptly to the City.
1.5.3 A third party ‘furnishings, fixtures and equipment’ consultant will value the
remaining supplies, materials and minor tools and equipment (not the
subject of the sale and purchase) at the Site that is related to Golf Course
maintenance. The Contractor shall pay the City for the cost of the
independent consultant’s valuation by the Effective Date or as soon as
practicable as agreed to by the City.
1.5.4 The Contractor shall take all necessary precautions for safe operation of
purchased equipment and the protection of the public from injury and
damage from such equipment.
1.5.5 All accessory equipment must be maintained in a clean, safe, functioning
condition at all times and repainted as required to present an aesthetically
pleasing appearance.
1.5.6 The Contractor shall be responsible for the repair and replacement of Golf
Course signage, shoe brushes, trash receptacles, ash urns, greens cups,
NCGA tee markers, benches, sand rakes, flags and poles, ball washers,
fairway yardage poles, and sprinkler yardage markers.
1.6 INQUIRIES AND COMPLAINTS
1.6.1 The Contractor shall have at the Golf Course and the Site designated
responsible management personnel who will be authorized to take the
necessary action regarding inquiries and complaints that may be received
by the City, the golf course management services professional and/or
patrons during regular business hours. Copies of any and all public
correspondence will be provided to the GSM.
Attachment B
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1.6.2 Whenever immediate action is required to prevent impending injury, death
or property damage to the Site and/or the Facilities and the Golf Course
facilities to be maintained or serviced by the Contractor, the City may after
reasonable attempt to notify the Contractor, cause such action to be taken
by the City’s employees, agents, representatives, contractors and
subcontractors and shall be permitted to charge the full cost thereof to the
Contractor. The Contractor shall reimburse the City for such costs and
expenses within ten (10) days of demand.
1.6.3 All complaints shall be abated as soon as possible after notification to the
satisfaction of the City. If any complaint is not abated within a reasonable
time, the Contractor shall notify immediately the City of the reason for not
abating the complaint, which shall be followed by a written report sent to
the GSM within three (3) days of the incident giving rise to the complaint.
1.6.4 Monthly golfer surveys will be conducted; golfer satisfaction of Golf
Course conditions, indicating ‘good’ or ‘excellent’ is expected from 80% or
more of responses. The City reserves the right to consult with the
Contractor in the event the responses fall below such threshold.
1.7 MAINTENANCE EMPLOYEES/UNIFORMS/VEHICLES
1.7.1 Employees: The Contractor shall designate a full-time Class “A” Golf
Superintendent and Mechanic (the “Superintendent”), who shall be
assigned to full-time service at the Golf Course. There shall be present at
the Golf Course an English-speaking supervisor, who shall be fully trained
in all maintenance responsibilities and who shall remain on-site at all times
while the Services are being performed at the Golf Course. The
Contractor shall provide to the City on or before the Effective Date, all job
classifications and descriptions for personnel who will be assigned duties,
responsibilities and services to be performed at the Golf Course in
furtherance of the Contractor’s obligations under the Agreement.
A minimum of ten (10) full-time equivalent maintenance employees,
between March 1st and October 30th, and eight (8) full-time equivalent
maintenance employees, between November 1st and February 28th, shall
be assigned to work solely at the Golf Course and shall not be assigned
duties or responsibilities at other sites nor shall they be rotated between
other sites that are maintained by the Contractor. The Contractor may use
temporary employees in case of absences or emergencies, if those
employees are trained in golf course maintenance, etiquette, and are in
uniform in accordance with applicable standards.
The Contractor may use temporary employees in case of absences or
emergencies if those employees are trained in golf course maintenance,
etiquette, and are in uniform and as otherwise will comply with industry
standards.
All maintenance employees shall present a neat, well-groomed
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appearance at all times.
The Contractor’s employees shall act in a courteous, professional manner
at all times. Every effort shall be made to perform the work while creating
minimum disturbance to the golfers. Any Contractor employee, who is
determined by the GSM to be incompetent, disorderly, and intemperate or
otherwise behaves objectionably, upon request of the GSM, shall be
immediately removed by the Contractor from the Golf Course crew and
replaced with a satisfactory replacement.
The Superintendent will attend and participate in bi-weekly Golf Course
management/tenant meetings, monthly Golf Advisory Committee meetings
and other Golf Course-related meetings, whenever the subject of Golf
Course maintenance will be a topic or related topic of discussion.
The Superintendent shall play the Golf Course in order to be able to
discuss the Golf Course conditions with the golf course services
professional and golfer patrons and experience first-hand the playing
conditions. Rounds shall be limited to the weekdays, and in no event more
than four (4) complimentary rounds a month, subject to space availability,
and no advance reservations will be permitted. All other Contractor
maintenance staff assigned to duties at the Golf Course may play two (2)
complimentary rounds a month, weekdays only, subject to space
availability, and no advance reservations.
The Contractor’s staff, who will be assigned to duties at the Golf Course,
shall be fingerprinted before they will be permitted to commencing work on
behalf of the Contractor at the Golf Course. The Contractor will confirm, in
writing, of such fingerprinting, upon request of the GSM.
1.7.2 Uniforms: The Contractor shall pay for and bear the maintenance cost of
uniforms for all employees working on the Golf Course.
The uniform shall be worn as a complete unit and be fitted properly. The
uniform shall be cleaned and pressed with no rips, tears or permanent
stains present. The uniform shall include an insignia or logo that refers to
“City of Palo Alto Municipal Golf Course.”
In cool weather when a jacket or sweatshirt is needed, the jacket or
sweatshirt shall be worn as the outer garment. All shirts and jackets shall
have the golf course logo and the worker’s first name on them.
Protective golf staff equipment shall be determined by the Contractor
when working on the golf course. When working elsewhere at the facility,
but not within the actual field of play, a cotton uniform cap with either of
the golf course logos may be worn, but must be worn with the bill facing
forward at all times.
Attachment B
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1.7.3 Vehicles: All vehicles owned, controlled or used by the Contractor at the
Golf Course shall be maintained in good mechanical and body repair. The
vehicles shall be in clean condition, both inside and outside at all times.
The vehicles driven on public roadways shall bear the Contractor’s
company name or seal, which shall be visible on both sides of the
vehicles. The vehicles used on the Golf Course will also display an
adopted insignia or logo that refers to “City of Palo Alto Municipal Golf
Course.”
Each vehicle shall be equipped to hold all necessary tools and equipment
in a neat and orderly fashion.
1.8 THE CITY’S RIGHT TO DO WORK
The City reserves the right to perform work as required on the Golf
Course, including all areas, grounds, buildings and structures, and to
access the Site to use any building or shed thereon and perform
maintenance or other work on City-owned lighting and other facilities on or
about the Site. The work referenced herein may include, but is not limited
to, capital improvements and/or alterations intended to improve the Golf
Course facilities and infrastructure. If such project(s) will affect the
Contractor’s cost to provide the Services as agreed to in the Agreement
and the Contractor desires to seek compensation for additional costs, then
the Contractor shall be required to submit, in writing, justification to
support the additional costs before incurring any such costs. The Parties
will review the justification in order to be able to address any desired
modifications to the compensation provisions of this Agreement.
2.0 SPECIFIC MAINTENANCE REQUIREMENTS
2.0.1 The Contractor shall notify the City prior to use of a subcontractor on the
Golf Course. All subcontractors shall obtain and maintain appropriate
insurance and comply with safety requirements and shall be trained in golf
course etiquette procedures prior to any work being performed.
2.0.2 The Contractor shall provide to the golf course services professional and
Pro-Shop tenant upon request any fuel located at the Site and Facilities in
connection with the operator-tenant’s golf course-specific equipment, such
as a ranger vehicle and one or more snack carts. As set forth in Section Z
and in Section AA of the General Terms and Conditions, the Contractor
and operator-tenant shall collaborate on an agreement relating to fueling
operations and compensation for fuel.
2.0.3 All Golf Course-related plans, blueprints, and drawings are the property of
the City and shall not be removed from City property. The Contractor shall
be permitted to make copies as required, to ensure the original set of
plans, blueprints and drawings remain in good condition.
Attachment B
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2.0.4 The Contractor shall perform any required maintenance activities,
including, but not limited to, ropes, stakes, traffic control, turf aerification,
and overseeding as a result of golf cart use on the Golf Course.
2.0.5 The Contractor shall meet weekly with the golf professional to coordinate
golf events and maintenance activities.
2.1 MAINTENANCE RECORDS
The Contractor shall provide the GSM with a written schedule of the work
to be performed during the following month, which shall include, but is not
limited to: general Golf Course maintenance, aerification, tree trimming,
pond maintenance, herbicide/insecticide application, fertilization and
replacement of plants with bright colors. The report shall be provided in a
format developed by the Contractor and approved by the GSM. If the
Contractor finds that it is not possible to maintain the submitted schedule,
the GSM shall be advised, and a revised schedule shall be submitted.
2.1.1 The Contractor shall maintain and keep current a log that records all on-
going, seasonal and additional work, and maintenance functions
performed on a daily basis by the Contractor’s personnel. The report shall
be in a form and content acceptable to the GSM and shall be submitted to
the City concurrent with the monthly invoicing. The monthly payment will
not be made until such report is received by the City.
2.2 TREES
2.2.1 Trees trimmed as needed. All tree trimming activities shall be performed
on a schedule approved by the GSM and in accordance with the tree,
shrub and other wood plan maintenance pruning practices outlined by the
American National Standards Institute, Inc. (ANSI) and International
Society of Arboriculture (ISA) Best Management Practices standards.
However, such trimming and pruning is a minimum level and shall not
relieve the Contractor of other responsibilities set forth herein. The
Contractor shall consult with the City’s Managing Arborist on issues
concerning the removal or treatment of trees at the Golf Course.
2.2.2 Trees shall be kept in healthy condition and pruned as required to remove
broken or diseased branches. The Contractor shall develop a pruning
program, which will promote proper tree scaffolding, strength, and
appearance consistent with its intended use. The Contractor shall prune
trees to allow wind to pass through the tree, reducing and preventing a
“sail” effect when needed.
2.2.3 Trees located adjacent to vehicular and/or pedestrian traffic ways shall be
maintained so as not to obstruct vehicle and/or pedestrian visibility and
clearance. Trees interfering with airport tower vision must be trimmed and
lowered as needed.
Attachment B
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2.2.4 Fertilization shall be scheduled as often as required to keep trees in a
healthy and desirable condition per soil analysis and identification of
nutrient deficiencies as outlined in the pruning specifications. The
Contractor shall not apply fertilizer to the root ball or the base of the main
stem, but shall spread evenly in the area of drip zone.
2.2.5 Tree stakes, ties, and guys shall be checked and corrected as needed.
Ties will be adjusted to prevent girdling. Remove unneeded stakes, ties,
and guys as required. Re-stake trees as required using lodge pole stakes.
2.2.6 Prune trees along sidewalks and cart paths to allow a ten (10) foot
clearance for pedestrians and golf carts and fifteen (15) feet above curb
and gutters for vehicular traffic.
2.2.7 Ailing or stunted trees which fail to meet expected growth will receive
additional nutrient treatments to correct any deficiencies. Terminally
diseased trees are to be removed per the City’s removal policy and
procedures.
2.2.8 Surface roots, which become maintenance or appearance problems, will
be removed or additional soil and sod cover shall be placed as required to
prevent damage to adjacent areas, mowers and golf carts. No weed whip
marks or herbicides around exposed roots or trunks.
2.2.9 Any trees that are blown over shall either be removed and replaced or
topped and righted at the Contractor’s expense.
2.2.10 The Contractor shall develop a tree management plan within six (6)
months of the Effective Date, which shall be approved by the GSM, for
maintenance of existing trees, removal of dead or diseased trees, and
replacement of aging trees. The Plan will be reviewed by the City’s
Managing Arborist for comments and amendments before being accepted
by the City.
2.2.11 Any dead tree that exists through no fault to the Contractor shall be
removed (with the City’s prior approval), including stump grinding and
repair of such area at the Contractor’s expense.
2.2.12 Any dead tree that is present through the fault of the Contractor shall be
removed (with the City’s prior approval) and replaced per the City Tree
Ordinance at the Contractor’s expense.
2.2.13 The Contractor shall plant and care for up to 50 new trees each year of
the contract. Trees will be provided by the Contractor. Salt tolerant trees,
recycled water tolerant, wind breaks, maximum height requirements
(airport) will be considered when selecting trees.
Attachment B
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2.2.14 The Parties agree that the annual compensation provided herein includes
an amount not to exceed $13,000 annually, allocated for the arbor care,
including tree planting, stump grinding and major tree trimming, and
associated green waster disposal for trees above 15 feet from the ground.
2.3 SHRUBS The Contractor shall:
2.3.1 Prune shrubs to retain as much of the natural informal appearance as
possible.
2.3.2 Shrubs used as formal hedges or screens shall be pruned as required to
present a neat, uniform appearance.
2.3.3 Remove any spent blossoms or dead flower stocks as required to present
a neat, clean appearance.
2.3.4 Plants growing over curbing and/or sidewalks shall be trimmed on a
natural taper rather than vertical so as not to appear to be hedged.
2.3.5 Schedule the application of a commercial fertilizer as often as required to
promote optimum growth and healthy appearance to all shrubs.
2.3.6 Any plant requiring removal shall be replaced by the Contractor.
2.4 GROUND COVER – NATIVE GRASSES
2.4.1 Apply all chemical control (e.g. pesticides) as required and in
conformance with the Golf Course Integrated Pest Management Plan that
will be approved each year (Section 1.3) to control or prevent pest
infestations to protect ornamental plantings.
2.4.2 Trim ground cover adjacent to walks, walls and/or fences as required for
general containment to present a neat, clean appearance.
2.4.3 Cultivate and/or spray herbicide to remove broad-leafed and grass weeds
as required (and in conformance with the Golf Course Integrated Pest
Management Plan that will be approved each year (Section 1.3). Shrub
beds shall be maintained in a weed free condition.
2.4.4 Keep ground cover trimmed back from all controller units, valve boxes,
quick couplers, or other appurtenances or fixtures. Do not allow ground
covers to grow up trees, into curbs, or on structures or walls. Keep
trimmed back approximately 4 inches from structure or walls.
2.4.5 Fertilization: Schedule fertilization of all ground cover areas with a
commercial fertilizer as often as required to promote healthy appearance.
Any fertilizer or chemicals must be applied is strict adherence with
manufacturer’s directions to avoid contamination of waterways or
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disturbance of natural resources. Fertilizers that contain pesticides must
be reported to the IPMC on the Contractor’s Pesticide Application Form.
2.4.6 Ground cover plants shall be added as needed to ensure a solid mass
planting in conformance with the original intent.
2.5 PEST CONTROL ON PLANTS
2.5.1 The Contractor shall provide complete and continuous control and/or
eradication of all plant pests or diseases in conformance with the Golf
Course Integrated Pest Management Plan (Section 1.3).
2.5.2 The Contractor shall supply the proper chemical designated for the pests
to be controlled. Any pesticides or chemicals must be applied in strict
adherence with manufacturer’s directions to avoid contamination of
waterways or disturbance of natural resources and be in conformance with
the Golf Course IPM Plan that will be approved each year.
2.5.3 The Contractor shall obtain all necessary regulatory permits and assume
responsibility for the use of all chemical controls.
2.6 IRRIGATION SYSTEM
The Contractor will assume all responsibilities for maintenance and repair
of all 2 inch and smaller pipe and all components of the irrigation system
such as sprinkler heads, valves, valve boxes, restraints, gaskets, swing
joints, quick couplers, saddles, electrical, controller satellites, and
hardware of the Golf Course irrigation system. All expenses for parts and
labor will be paid for by the Contractor. When replacing steel nuts and
bolts the Contractor will use only highest grade stainless steel. All
components will be replaced with same manufacture and models as
components being replaced unless otherwise approved by GSM.
2.6.1 EFFICIENT USE OF WATER:
2.6.1.1 Considerations must be given to soil texture, structure, porosity, water
holding capacity, drainage, compaction, precipitation rate, run off,
infiltration rate, percolation rate, evapotranspiration, seasonal
temperatures, prevailing wind condition, time of day or night, type of grass,
plant and root structure. This may include syringing during the day and
watering during periods of windy weather.
2.6.1.2 The Contractor shall be responsible for daily monitoring all systems within
premises and correcting for coverage, adjustment, clogging of lines and
sprinkler heads, removal of obstacles, including plant materials which
obstruct the spray.
2.6.1.3 The soil moisture content on greens, tees and fairways shall be checked
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regularly and appropriate adjustments made. Adequate soil moisture shall
be determined by visual observation, plant resiliency, and turgidity,
examining cores removed by soil probe, moisture sensing devices and
programming irrigation controllers accordingly.
2.6.1.4 The Contractor shall observe and note deficiencies occurring from the
original design of facilities and review these findings with the GSM so
necessary improvements can be considered.
2.6.1.5 All leaking or defective valves, lines, sprinkler heads, and quick couplers
shall be repaired within twenty-four (24) hours at the expense of the
Contractor. A report of such repairs shall be given to the GSM weekly.
2.6.1.6 The Contractor shall turn off all controllers when it is not necessary to
irrigate due to adequate rainfall.
2.6.1.7 The Contractor shall monitor reclaimed water and potable water.
Reclaimed water shall not exceed 65% and potable water costs shall not
exceed $250,000. The Contractor shall notify GSM if these costs exceed
$225,000. As conditions dictate GSM may approve additional potable
water use.
2.6.1.8 The City acknowledges that the adequacy of water supply and quality
cannot be guaranteed for water irrigation purposes and that, after the
Effective Date, the City may adopt water usage restrictions and take other
measures that could impact the amount of water available for irrigation
purposes at the Golf Course. In the event that the City becomes aware of
a decrease in the water supply, then the City will inform the Contractor of
such occurrence, and the Parties promptly will use reasonable efforts to
ascertain the effect, if any, of the decrease in water supply on the
standards of maintenance to which the Contractor is required to adhere in
the performance of the Services. To the extent practicable, the City will
endeavor to prioritize water usage in order to cause the least impact to the
water supply available to the Golf Course, and the Contractor’s obligation
to adhere to the standards of maintenance will be evaluated by the City
under then prevailing conditions of a decrease in water supply for irrigation
purposes.
2.6.2 SYSTEM MAINTENANCE
The Contractor is aware of the current location and general condition of
the Golf Course’s water irrigation system and accepts the system in its
“as-is” “where-is” conditions, and agrees to be fully responsibility for the
repair and maintenance of the system. Any required replacements,
repairs, and maintenance to existing components of the system to ensure
the system remains in operation are the sole responsibility of the
Contractor. Appropriate personnel shall be trained in the use of the master
irrigation computer.
Attachment B
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2.6.2.1 All controllers are to be kept pest-free, clean and visible. All parts and
repairs necessary to maintain the operation are the responsibility of the
Contractor.
2.6.2.2 The computer and software (including annual service agreements)
necessary to operate and maintain the irrigation control system shall be
maintained by the Contractor. The Rainbird Support Agreement, a copy of
which shall be made available to the Contractor by the City, shall be kept
current by the Contractor at all times during the Term. Computer and
Controller information will be properly kept.
2.6.2.3 Any repairs made by the operator shall be made in accordance with the
industry standards and conforming to all related codes and regulations.
2.6.2.4 The Contractor shall be responsible for adjusting the height of sprinkler
risers necessary to compensate for growth of plant materials.
2.6.2.5 Automatic controllers and/or enclosures shall be locked while
unattended.
2.6.2.6 All controller enclosures must be painted or replaced as needed to
maintain a good appearance.
2.6.2.7 Sprinkler heads and valve boxes shall be kept clear of overgrowth which
may obstruct maximum operation. Missing or broken valve boxes will be
replaced by The Contractor.
2.6.2.8 Repairs and/or upgrades made to the irrigation system must be made in
accordance with the system’s original design with products equal to or
higher quality than currently provided.
2.6.2.9 The GSM shall be promptly notified of any interruption in water service to
the Golf Course.
2.6.2.10 All irrigation repairs and maintenance including, but not limited to,
sprinkler heads, piping, fittings, valves, controller boxes, controller
supplies, and controller face plates must be performed utilizing the same
manufacturer and type of product as existing materials. Any change to
existing materials must have the prior approval by the GSM.
2.7 ANIMAL AND RODENT CONTROL
The Contractor shall continuously, at a minimum on a weekly basis,
control and eradicate rodents and other animal pests as necessary to
prevent hazards, holes and destruction of plantings on golf course
property in accordance with the Golf Course IPM Plan which will be
drafted annually and following specifications for rodent control. Damage to
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public or private property due to erosion as a result of rodent activity shall
be repaired at the Contractor’s expense.
The Contractor will use reasonable efforts to several times daily remove
the geese from the Golf Course. The Contractor shall contact the Palo Alto
Airport Tower for their approval whenever there are attempts to remove
the geese from the Golf Course. Goose guano shall be cleaned on an as-
needed basis on the Tees, Greens, Approaches, Fairways, and Cart
Paths, using best management practices.
2.8 WEED CONTROL OF PAVED SURFACES
The Contractor shall control all weeds growing in cracks, expansion joints
and other hard surfaces by the use of mechanical weed control or with
limited use of chemicals in accordance with the Golf Course IPM Plan.
2.9 WEED CONTROL IN LANDSCAPE AREAS
Weed control in landscaped areas shall be accomplished by mulching and
the use of mechanical weed eradication.
2.10 STRING TRIMMERS
Care shall be exercised with regard to the use of string trimmers to
prevent damage to building surfaces, walls, header board, light fixtures,
signage, etc. A minimum of 12” bare soil or mulched buffer zone shall be
maintained around the circumference at the base of all trees in
landscaped areas.
2.11 GREENS
Maintain all turf in accordance with playability and industry wide standards
as determined by the GSM, observing the following minimum
requirements:
2.11.1 Greens shall be mowed daily in the summer (March 1 – October 31) and a
minimum of three (3) times per week during the winter (November 1 –
February 28) with an approved greens reel type mower at a height of 130
or as recommended by the superintendent and approved by the GSM.
Frequencies and height of cut may be modified from time to time as
deemed necessary by the golf course superintendent with the prior
approval of the GSM. All grass clippings must be collected and removed
from the site during each mowing operation, including dispersed in a
method to prevent unplayable conditions. Greens must be mowed, and
rolled if performed, prior to first golfer of day reaching each respective
green, including the putting green. Care will be given on clean-up lap
mowing to reduce turf loss and playability.
Attachment B
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2.11.2 Ball cups are to be relocated daily to USGA Standards to enable worn
turf spots to recover. Putting green cups to be changed every other day.
Hole positions will be rotated using front, middle, and back locations for
each three hole sequence. Pin placement shall be in healthy turf area
according to rotation plan. Hole plugs set at proper grade.
2.11.3 Verticutting of greens shall be scheduled bi-weekly or more including
double verticutting during periods of active turf growth. Each verticutting
shall be at 90 degrees to the previous cut. Verticutting activities should
match the agronomic requirements of plant growth. This function shall
be coordinated to compliment the aerification and topdressing schedules.
Combing or brushing may also be done. Verticut depth should be
appropriate to playing conditions and agronomic needs. If play
conditions are such that greens are not smooth for ball roll (bumpy), the
Contractor shall utilize verticutting and other agronomic methods to
improve golf ball roll.
2.11.4 Aerify greens at least two (2) times per year in spring, either March or
April, and fall, either September or October, or more frequently if needed.
Plugs will be removed the same day. Aerification shall be carried out
with a minimum of interference to play. Aerification shall be scheduled at
least 6 months in advance with the GSM and golf professional. All
aerification hole sizes with a minimum of 5/8 inch hollow tine utilized, and
spoil locations shall be pre-approved by the GSM. Aerification holes shall
penetrate to a depth of three inches. Care should be taken to have as
minimal disturbance to green surface from manual and equipment
applications during aerification process. Aerification of greens for
agronomic purposes, other than annual regularly scheduled aerifications,
shall be reviewed and scheduled with the golf professional and GSM to
reduce golfer impact.
2.11.5 Following all annual regularly scheduled aerifications, a topdressing sand
material approved by the GSM shall be applied and brushed into the turf
with follow applications performed as needed. Application shall be done
with an approved topdressing spreader or blown in with walking blowers.
Spot topdressing may be applied to repair damage from ball marks or
any other damage. Light topdressing will be done every two weeks
during the active growth season to maintain turf playability and
agronomic conditions. Turf irrigation requirements shall be adjusted
during process to ensure proper agronomic conditions are met.
2.11.6 The Contractor shall have the soil analyzed after the start of the term of
the contract and once every year thereafter on dates preapproved by the
GSM. Apply fertilizer and nutrients in the quantity and type
recommended by soil analysis and growing conditions at the time of
treatment and in a manner to provide uniform growth of turf. Under
normal conditions, 0.5 to 1.2 pounds of actual nitrogen per thousand
square feet shall be applied per growing month. Typically, a variety of
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granular slow release types of material or liquid sprayable fertilizer may
be utilized. Use of materials to control salt damage and water infiltration
shall be applied to meet the requirements of the turf and playable
conditions. Fertilizer shall be applied every 3-4 weeks during the active
growing season and every five (5) weeks for the remainder of the year.
2.11.7 Treat greens with proper chemicals to control insects, disease, weeds
and other pests in conformance with the City’s IPM Plan.
2.11.8 Greens shall be kept free of non-native and/or invasive grasses and/or
broadleaf weeds that tend to creep in from the edges. A threshold level of
0-2% has been set for weeds and disease: Insect threshold has been set
at 0-5%. No foreign grass encroachment from collars.
2.11.9 EC readings should be taken during spring and fall to determine salts
levels and if they are above normal, corrective action taken to reduce to
appropriate levels to promote optimum health of the turf.
2.11.10 Green speed should be consistent daily on all greens with the difference
between the lowest green speed and the highest green speed no more
than one (1) foot in variance on the stimp meter through out golf course.
Green speeds should be no lower than 8 feet in average daily during the
months of May, June, July, August, September, and October, and no
lower than 8 feet 6 inches daily for the other months. Green speeds
should be maintained as high as agronomic conditions and play
conditions allow.
2.11.11 Debris from trees shall be cleared prior to mowing and during day as
needed, no standing water or severe turf loss areas, pest and vandal
damage to be repaired, and bare and stressed areas sodded or plugged
to ensure quality playing conditions.
2.11.12 Ball marks shall be repaired daily.
2.12 COLLARS, APPROACH, BANKS AND GREEN SURROUNDS
Maintain all turf in accordance with playability and industry wide
standards as determined by the GSM observing the following minimum
requirements:
2.12.1 Collars shall be mowed a minimum of two (2) times each week during the
summer (March 1 – October 31) and one (1) to two (2) times each week
during the winter to (November 1 – February 28) maintain a height of ½
inch, mowing with a triplex mower.
2.12.2 Green surrounds shall be mowed a minimum of two (2) times each week
in the summer (March 1 – October 31) and one (1) to two (2) times per
week in the winter (November 1 – February 28) to maintain a height of 1
inch to 1-1/4’ inches or a height as recommended by the Superintendent
Attachment B
Rev. January 11, 2010
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
and approved by the GSM. If a rotary mower is used, it shall be
specifically designed to prevent scalping of the turf.
2.12.3 Fertilization frequency, types of material, and analysis shall be
determined from results of annual soil nutrient level testing and growing
conditions at the time of treatment. Under normal conditions, 0.50 to 0.75
pounds of actual nitrogen per thousand square feet shall be applied every
6-8 weeks during the active growth season and every 8-10 weeks for the
remainder of the year. Typically combinations of granular slow release
type of materials may be utilized.
2.12.4 Mowing directions should be changed to prevent turf depressions and turf
loss.
2.12.5 Approach shall be mowed a minimum of two (2) to three (3) times each
week in summer (March 1 – October 31) and one (1) to two (2) times per
week in the winter (November 1 – February 28) to maintain a height of ½
inch or a height as recommended by the superintendent and approved by
the GSM, cut with a greens-type triplex mower.
2.12.6 Grass clippings shall be removed and dispersed properly to avoid
affecting golf play.
2.12.7 Bunker banks shall be mowed to ensure no rutting occurs and proper turf
heights are maintained. If rutting occurs, areas shall be sodded for repair.
2.12.8 Verticutting shall be performed at least two (2) times per year. All other
provisions of section 2.11.3 shall be followed.
2.12.9 Aerify at least two (2) times per year in spring and fall, or more frequently
if needed, and remove plugs the same day. Aerification shall be carried
out with a minimum of interference to play. Aerification shall be scheduled
each year for the following year in conjunction with the GSM and golf
professional. All aerification hole sizes, with a minimum of 5/8 inch hollow
tine utilized, and spoil locations shall be pre-approved by the GSM.
Aerification holes shall penetrate to a depth of three inches. Care should
be taken to have as minimal disturbance to the turf surface from manual
and equipment applications during aerification process. Aerification for
agronomic purposes other than annual regularly scheduled aerifications
shall be reviewed and scheduled with the golf professional to reduce
golfer impact.
2.12.10 Following all annual regularly scheduled aerifications, a topdressing sand
material approved by the GSM shall be applied as needed. Application
shall be done with an approved topdressing spreader. Turf irrigation
requirements shall be adjusted during process to ensure proper
agronomic conditions are met.
Attachment B
Rev. January 11, 2010
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
2.13 TEE MAINTENANCE
Maintain all turf in accordance with playability and industry-wide standards
as determined by the GSM observing the following minimum
requirements:
2.13.1 Service tees daily by moving tee markers, removing trash and checking
benches and ball washers. Change tee towels and water weekly and
keep ball washers filled to proper level with water and appropriate
cleaning agent. Tee markers shall be moved daily to healthy turf areas,
placed at appropriate direction to play. Tee markers placed in healthy
areas with tee markers set flat to ground and direction of play.
2.13.2 Mow tees two (2) times weekly in the summer (March 1 – October 31) and
one (1) to two (2) times weekly in the winter (November 1 – February 28)
with reel type mower, with baskets, at height of 1/2 inch or a height as
recommended by the superintendent and approved by the GSM. All grass
clippings will be collected and dispersed properly for playable conditions.
2.13.3 Aerify and topdress tees, with sand and mulch pre-approved by the GSM,
at least two (2) times per year, or more frequently if needed, using the
appropriate equipment with the minimum of interference to play.
Aerification shall be carried out with a minimum of interference to play and
plugs removed the same day. Aerification shall be in conjunction with the
golf professional and the GSM. All aerification hole sizes, with a minimum
of 5/8 inch utilized, and spoil locations shall be pre-approved by the GSM.
Care should be taken to have as minimal disturbance to tee surface from
manual and equipment applications during aerification process. Bare
areas sodded and leveled.
2.13.4 Fertilization frequency, materials and analysis shall be determined from
results of annual soil nutrient level testing and growing conditions at the
time of treatment. Under normal conditions, 0.50 to 0.75 pounds of actual
nitrogen per thousand square feet shall be applied every 6-8 weeks during
the active growth season and every 8-10 weeks during the remainder of
the year. Typically combinations of granular slow release type of
materials may be utilized.
2.13.5 Repair worn and damaged turf areas as they occur by topdressing,
overseeding or resodding to ensure playability at all times. No standing
water or mud holes and pest and vandal damage repaired.
2.13.6 Tees shall be overseeded, with approved perennial rye seed by the GSM,
following aerification and before topdressing at a rate of 9 lbs. per
thousand square feet of tee area.
2.13.7 Treat tees for control of insects, disease, weeds and other pests as
necessary to maintain healthy turf. All treatments shall be in compliance
with the City’s IPM Plan. A threshold level of 25% has been set for weeds
Attachment B
Rev. January 11, 2010
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
and disease. Insect threshold is 33%. Spot spraying by location basis
only when thresholds are exceeded.
2.13.8 Trash receptacles are to be emptied daily.
2.13.9 A sand and seed container, approved by the GSM, must be available on
all Par 3 holes, for use in repairing divots. A container must be set at each
respective set of tee markers for each hole. Tee divots shall be filled with
sand and seed at a minimum of once per week on all holes and twice per
week on Par 3 holes.
2.13.10 Sufficient scorecard and pencil supplies shall be kept in stock at the
scorecard station between the No. 1 green and the No. 2 tee.
2.13.11 Tee yardage plaques, stations and signs shall be maintained and edged
at all times.
2.13.12 Tee station items, such as markers, signs, trash cans, ball washers, etc.
shall be in good condition and repaired or replaced as needed. All tee
station equipment cleaned and painted and ball washers operational.
2.13.13 Recycle trash containers shall be utilized and all recyclable glass, paper,
plastic, aluminum and other recyclable material shall be collected and
turned into appropriate recycle centers.
2.14 FAIRWAY MAINTENANCE
Maintain all fairways in accordance with playability and industry wide
standards as determined by the GSM, observing the following minimum
requirements:
2.14.1 Mow fairways two (2) times weekly in the summer (March 1 – October 31)
and one (1) to two (2) times weekly in the winter (November 1 – February
28) at height of 5/8 inch or at a height as recommended by the
superintendent and approved by GSM.
2.14.2 Aerify all fairways at least one (1) time a year. The equipment used to
aerify the fairways shall be Power Take-Off (PTO) or self engine powered
to enable a three (3) to five (5) inch coring depth (John Deere2000
Aercore Aerator or equivalent) utilizing hollow coring, with a minimum of
3/4 inch hollow tine, as recommended by the superintendent and
approved by the GSM and cores shall be removed from the fairways.
Aerification shall be scheduled in conjunction with the golf professional
and the GSM. All aerification hole sizes and spoil locations shall be
preapproved by the GSM. Care should be taken to have as minimal
disturbance to turf surface from manual and equipment applications during
aerification process. Slicing of the fairways at various intervals is
recommended to promote turf growth, improve water infiltration, and
Attachment B
Rev. January 11, 2010
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
improve salt damage.
2.14.3 Overseed all fairways once per year, in fall and at a preapproved date with
the GSM and golf professional, with perenial rye grass, pre-approved by
the GSM, at a minimum rate of 400 lbs. per acre. All seed shall be slit
seeded into the soil to ensure adequate soil and seed contact. A post
seed application of fertilizer (15-15-15 or equivalent) shall be applied with
four (4) weeks of the overseed process at a rate of one (1) lb per thousand
of nitrogen. Overseed and topdress (or re-sod) of worn or bare areas of
fairways as necessary.
2.14.4 Treat turf to control weeds, invasive grasses (i.e. Kikuyu), diseases,
insects, and other pests as necessary to maintain fairway threshold level.
A threshold level of 35% for weeds, 50% for disease and 40% for insects
has been set. Spot spraying by location basis as needed when thresholds
are exceeded. All treatments shall be in compliance with the IPM Plan.
2.14.5 A proper fertilizing and nutrient program shall be performed per soil testing
recommendations each calendar year. Fertilization shall be performed a
minimum of every 8-10 weeks during the active growth season and every
10-12 week during the remainder of the year.
2.14.6 Policing to control litter shall be done on a regular basis for the removal of
all paper, leaves, cans, bottles, tree branches, etc.
2.14.7 Excessive turf clippings shall be dispersed by a method of dragging,
baskets, vacuumed or blown to ensure proper playable conditions are
provided. Grounds under repair painted with appropriate white turf paint
and roped off neatly and consistently throughout the golf course. Grounds
under repair include those under repair by the Contractor and those areas
where turf is at a level that is not consistent with other associated turf
areas. Yardage markers and sprinkler head yardage markers in place and
maintained. Cart traffic management devices in place; bare or stressed
areas properly addressed. No standing water or mud holes. Pest and
vandal damage repaired.
2.14.8 Excessive turf clippings shall be dispersed by a method of dragging,
baskets, vacuumed or blown to ensure proper playable conditions are
provided. Grounds under repair painted with appropriate white turf paint
and roped off neatly and consistently throughout the golf course. Grounds
under repair include those under repair by the Contractor and those areas
where turf is at a level that is not consistent with other associated turf
areas. Yardage markers and sprinkler head yardage markers in place and
maintained. Cart traffic management devices in place; bare or stressed
areas properly addressed. No standing water or mud holes. Pest and
vandal damage repaired.
2.15 ROUGHS MAINTENANCE
Attachment B
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
Maintain all turf in accordance with playability and industry wide standards
as determined by the GSM, observing the following minimum standards:
2.15.1 Mow one (1) time per week in the summer (March 1 – October 31) and at
least biweekly during the winter (November 1 – February 28) at a height of
1-1/2 inches or a height as recommended by the superintendent and
approved by the GSM.
2.15.2 Rodent control and repair as needed. All rodent control shall be in
compliance with the IPM Plan. Pest and vandal damage repaired.
2.15.3 Overseed and topdress (or resod) worn or bare turf areas as necessary.
2.15.4 Fertilization frequency, materials and analysis shall be determined from
results of biannual soil nutrient level testing and growing conditions at the
time of treatment. Fertilization shall be performed a minimum of every 8-
10 weeks during the active growth season and every 10-12 week period
during the remainder of the year.
2.15.5 Treat turf to control weeds, disease, insects and other pests as necessary
to maintain rough threshold. All treatments shall be in compliance with the
IPM Plan. A threshold level of 100% for insects and disease. Weed
threshold has been set at 50%. Spot treatment by location basis only
when thresholds are exceeded.
2.15.6 Grounds under repair painted with appropriate white turf paint and roped
off neatly and consistently throughout the golf course. Grounds under
repair include those under repair by the Contractor and those areas where
turf is at a level that is not consistent with other associated turf areas. No
standing water or mud holes, hazards properly marked, and free of debris
that affects play.
2.16 OTHER TURF AND MAINTENANCE AREAS
These areas consist of areas not detailed above.
2.16.1 All debris such as litter and branches shall be removed from the course
daily.
2.16.2 All yardage, course markers, ropes and stakes, and signage shall be
straight and damage free, and repaired and replaced as needed.
2.16.3 Any item that is a safety hazard shall be repaired or replaced immediately,
2.16.4 The Contractor shall submit annually to the GSM a written report for the
preceding 12 months detailing annual fertilizer, pesticide, fungicide and
other related applications for the golf course. The report will conform to
Attachment B
Rev. January 11, 2010
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
the requirements of the IPM Plan.
2.16.5 The Contractor shall flush drainage inlets once a year.
2.16.6 The Contractor shall utilize wood chipping machinery to produce wood
chips from tree pruning and care. Wood chips may be spread throughout
golf course in preapproved areas by the GSM. No permanent dumping of
course debris such as branches, wood stumps, etc. is approved on the
property. The Contractor is responsible for costs associated with any
removal of debris. Any other course-generated debris such as earthen
spoils shall be dispersed at locations and with methods preapproved by
the GSM.
2.16.7 Turf areas surrounding the clubhouse shall be mowed one (1) time per
week at a height of 1-1/4 inches.
2.16.8 The Contractor shall provide, at its sole expense, an effective goose
control program to mitigate goose activities, including, but not limited to,
the use of control dogs, motorized hand controlled boats, noise makers,
and other methods.
2.17 SAND BUNKERS
2.17.1 Sand bunkers shall be cleaned and raked by mechanical method or by
hand a minimum of three (3) times per week with Fridays being one of the
three days. No excess sand buildup on high side.
2.17.2 Sand depth shall be randomly checked monthly for depth of sand and
shall be maintained no less than four inches (4”) deep. Additional sand
will be added at the Contractor’s expense.
2.17.3 Turf shall be mechanically edged along sand bunker edges monthly, or
more frequently if required, to ensure a neat appearance. Care shall be
taken to maintain the design outline of the bunkers to insure the integrity
of the bunker shape. Bunkers should have 1” lip on lower side. Chemical
control of sand edges through use of a non-selective herbicide or growth
regulator around sand bunkers shall be allowed with preapproval of GSM.
2.17.4 Excess sand in the turf surrounding the trap shall be removed on a regular
basis.
2.17.5 A minimum of two (2) to five (5) rakes are to be available, depending on
bunker size, at all sand bunkers at all times. Rakes properly maintained.
(Color and style are subject to GSM approval.)
2.17.6 Bunker sand shall be cultivated as needed, or at a minimum of once per
month, to ensure sand is not compacted. Methods should be used to not
disturb existing soil below the sand.
Attachment B
Rev. January 11, 2010
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
2.17.7 All debris such as pine needles and cones, branches and other debris
shall be removed as needed to ensure playable conditions and reduce
sand contamination. No animal boroughs.
2.17.8 Excessive water ponding and silt accumulated by rain falls and irrigation
applications shall be removed prior to bunker raking.
2.18 CLUBHOUSE AREAS
2.18.1 SHRUB BEDS
2.18.1.1 Clean-up shall occur on a regular basis to ensure that beds are kept
free of trash and debris such as paper, cans and bottles, fallen
branches, excessive leaves and weeds. Mulch in proper areas, beds
to be weed free, properly trimmed, and watered properly; not overly dry
or wet.
2.18.1.2 A fertilizer program shall be a minimum of three (3) applications per
year or as needed for health and color.
2.18.1.3 Spent flowers, leaves, dead or diseased plants, and other landscape
debris shall be removed from plant areas daily, or as required.
Flowers changed by schedule or as needed.
2.18.2 SEASONAL COLOR BEDS
2.18.2.1 Annual flowers in place and healthy and missing plants replaced in
kind and number. All color beds shall be regularly cleared of paper,
bottles and cans, fallen branches, excessive leaves and weeds.
2.18.2.2 Weed control shall be accomplished by hand weeding, mulching, by
the use of mechanical equipment or by the selective use of herbicides.
A prescribed pest control spray program may be done as often as
necessary for pest control in accordance with the IPM Plan.
2.18.2.3 Beds shall be cultivated by mechanical means on a regular basis or as
required, or as directed by the GSM.
2.18.2.4 Color plants shall be replaced a minimum of twice annually and shall
be performed on a schedule submitted to and approved by the GSM.
The replacement plants shall be 4-inch potted size spaced per industry
standards and planted with the appropriate soil amendments.
2.18.3 PERIPHERY AREAS (Including the Planted Traffic Island on
Embarcadero Way)
2.18.3.1 All periphery areas shall be maintained in a manner consistent to
Attachment B
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
industry standards to ensure a healthy and aesthetically pleasing
appearance at all times.
2.18.3.2 Areas shall be mowed, weeded, cleared of litter and other debris on a
regular basis (a minimum of once per week). Watering should occur if
the area is covered by the irrigation system.
2.18.3.3 Special attention shall be given to periphery areas adjacent to public
roadways since these areas are highly visible to the general public and
constitute a “first impression” of the overall service level of the course.
2.18.3.4 All areas are to be inspected for erosion problems and repaired as needed.
2.19 PARKING LOTS
2.19.1 Parking lots shall be maintained in a safe condition for use by both
vehicles and pedestrians, and cleaned each day to ensure a clean, crisp
appearance free from litter, debris, and weeds including all landscaped
planters on or adjacent to the lots (including the traffic island on
Embarcadero Way near the primary entrance to the Golf Course).
2.19.2 All parking lot lighting shall be inspected daily and repaired as needed or
reported to the City’s PW Facilities Maintenance Division.
2.19.3 “Disabled Parking” signage and other signage shall be maintained in
accordance with all City, County, and State regulations.
2.19.4 All parking lot signage shall remain in place, maintained and readable.
2.19.5 Parking lot asphalt shall be inspected daily by the Contractor. The City’s
PW Facility Maintenance Division shall be called for the performance of
repairs. The lots shall be generally maintained free of debris, litter, leaves,
and trimmings. The Contractor shall inspect and clean the lots daily.
2.20 GRAFFITI
2.20.1 The Golf Course shall be inspected daily for evidence of graffiti. Special
attention shall be given to restrooms, signs, markers, block walls, curbing,
paving, tees, utility poles/boxes and/or any other structures or fixtures.
2.20.2 All graffiti shall be removed within twenty-four (24) hours of detection.
2.20.3 Graffiti requiring paint over shall be painted over with a color consistent
with that of the original surface.
2.20.4 Graffiti on non-painted surfaces shall be removed by sand or water
blasting and area returned to the preexisting condition.
Attachment B
Rev. January 11, 2010
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
2.21 CART PATH/STEPS/RAMPS/WALKWAYS/ BREEZEWAY
2.21.1 Cart paths to be swept or blown clear of debris every Friday or more often
as needed. No standing water.
2.21.2 Concrete paths to be edged and scraped clean a minimum of one (1) time
per month or as needed. Cart paths weed free. See IPM Plan.
2.21.3 The Contractor shall identify all potholes and/or other surface damage or
defects on concrete cart paths and report to the City for repair. If damage
is the fault of the Contractor the repair cost will be the responsibility of the
Contractor. Base Rock utility roads on holes #9, #12, and #13 will be
graded smooth weekly. Additional base rock added as needed at the
expense of the Contractor.
2.22 RESTROOMS AT HOLE #5
2.22.1 Inspected daily by the Contractor, clean and stocked daily by the City’s
PW Facility Maintenance Division.
2.22.2 Inspected daily by the Contractor, sinks, toilets, walls, screens, and floors
shall be sanitized daily by the City’s PW Facility Maintenance Division.
2.22.3 Paper supplies shall be checked and restocked daily or as needed.
2.22.4 Inspected daily by the Contractor for odor and operation. PW will be
contacted for corrections and repairs.
2.22.5 Leaking or malfunctioning fixtures shall be reported to the City’s PW
Facility Maintenance Division immediately upon detection.
2.22.6 Lighting fixtures are to be checked daily with repairs of faulty fixtures
provided as needed at time of detection. The City’s PW Facility
Maintenance Division will be contacted for repairs.
2.22.7Restroom floors which are wet for any reason, including mopping, shall be
so indicated with proper temporary signage.
2.22.8 No graffiti. The Contractor will inspect daily and contact the City’s PW
Facility Maintenance Division for graffiti removal.
2.22.9 No worn spots in concrete, wood walls, or corrugated fiberglass barriers.
The City’s PW Facility Maintenance Division will be contacted for repairs.
2.23 MAINTENANCE FACILITIES
2.23.1 To the extent not otherwise addressed in Section Z of this Agreement, the
City shall make available for use by the Contractor, at no charge to
Attachment B
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
the Contractor, the Site and Facilities for the storage of golf course-related
equipment, materials and/or supplies. The Facilities will be available to the
Contractor on an “as is” basis. The Contractor will conform its use of the
Facilities to all applicable laws, rules and regulations regarding the storage
of materials on the City’s premises, including, but not limited to, the storage
of hazardous, toxic or flammable materials. The City assumes no
responsibility for any theft,
destruction or damage to the Contractor’s personal property that is stored
at the Facilities. The Contractor will return the facility to the City in its
original condition as of the date of commencement of the contract
between the City and the Contractor, normal wear and tear excepted.
2.23.1.1 Permitted Usage: The Contractor may use the Site and the
Facilities
for the following uses: Storage, Files, Office area or other similar
uses. The Facility may not be used for any other purposes
without the City Manager or designee's prior written consent,
which may be granted or denied at the City’s sole discretion.
2.23.1.2 Prohibited Uses. The Contractor shall not use the Site and the
Facilities for any purpose not expressly permitted hereunder.
The Contractor shall not create, cause, maintain or permit any
nuisance or waste in, on, or about the Site or the Facilities, or
permit or allow the Site or the Facilities to be used for any
unlawful or immoral purpose. The Contractor shall not do or
permit to be done anything in any manner which unreasonably
disturbs the users of the City’s property or the occupants of
neighboring property. Specifically, and without limiting the
above, the Contractor shall not cause the emanation of any foul
odor or excessively loud noise, vibration, power emission, or
other item to emanate from the Site or the Facilities. No
materials or articles of any nature shall be stored outside of or
upon any portion of the Site or the Facilities. The Contractor will
not use the Site or the Facilities in a manner that will increase
the risk of fire, cost of fire insurance or improvements thereon.
No unreasonable sign or placard shall be painted, inscribed or
placed in, on or about the Site or the Facilities and no tree or
shrub thereon shall be destroyed or removed or other waste
committed at the Site or the Facilities. No bicycles,
motorcycles, automobiles or other mechanical means of
transportation shall be placed in stored facilities at the SIte,
except for the garage or driveway. No repair, overhaul or
modification of any motor vehicle shall take place in the
Facilities or the surrounding property or the street in front of
Facilities. The Contractor, at its sole cost and expense, shall
keep the Site and the Facilities in as good as the condition as of
the Effective Date, excepting damage resulting from ordinary
Attachment B
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Valleycrest; Amend 1\C11136681 Amend No 1; Exhibit A SOS FINAL.doc
wear and tear, and except damage to the roof, sidewalks and
underground plumbing, which is not the fault of the Contractor.
2.23.1.3 Condition, Use of Premises. The Contractor acknowledges
that it has conducted a physical inspection of the Site and the
Facilities prior to executing this Agreement. In that regard, the
City makes no warranty or representation of any kind
concerning the condition of the Site or the Facilities, or the
fitness of the Facility for the use intended by the Contractor, and
hereby disclaims any personal knowledge with respect thereto,
it being expressly understood by the parties that the Contractor
has personally inspected the Facility, knows its condition, finds it
fit for the Contractor’s intended use, accepts it as is, and has
ascertained that it can be used exclusively for the limited
purposes as have been specified in Section 2.23.1.1.
2.23.2 The Facilities shall be kept clean and neat at all times with all material
inventories and supplies stored in a manner in keeping with CAL-OSHA
regulations, the City’s Fire Department regulations, and all City, County
and State regulations. Fire extinguishers must be operational and
inspected by the Fire Department.
2.23.3 Maintenance buildings and surrounds inspected daily. Report needed
repairs to GSM within 24hrs.
2.23.4 The Site shall be locked or otherwise secured when unattended to
discourage unauthorized entry.
2.23.5 Office and lunchroom floors are to be vacuumed or swept five times per
week and mopped at least once a month at the Contractor’s expense.
2.23.6 Rain gutters shall be kept clear of debris and cleaned a minimum of once
per year prior to fall rainfall period at the Contractor’s expense.
2.23.7 Any security system shall be maintained and utilized at the Contractor’s
expense.
2.23.8 The Facilities shall be maintained by performing required daily, monthly
and annual maintenance of garage doors, inside and outside doors, inside
and outside windows, air conditioning or heater unit, lighting, shelving, etc.
All repairs to such facility are the responsibility of the Contractor. The City
shall be responsible for roof repairs and repairs to the external surfaces of
the building structures. The Contractor shall obtain and be responsible for
quarterly service to air conditioner and heating unit, and any subsequent
repair or service costs, and shall supply copy of written agreement to the
GSM.
2.23.9 All facility and associated Golf Course maintenance utility costs are the
Attachment B
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responsibility of the Contractor, including telephone, gas, potable water,
sewer, and trash, except as otherwise agreed to, in writing, by the City.
The City will provide electrical service to the Site and the Facilities without
an additional charge to the Contractor in excess of the compensation
payable under Section 5 and Exhibit “C”.
2.23.10 Adherence to all City, County, and State regulations for proper storage
and disposal of materials is required.
2.24 CLUBHOUSE AND FACILITY LIGHTING
All lighting systems shall be inspected by the Contractor on a regular basis
for faulty bulbs, fixtures or other malfunctions repaired and/or replaced as
needed by the City’s PW Facility Maintenance Division.
2.24.1 Walkways, breezeway, surroundings, ramps, driving range walkway and
tees cleaned of litter, dirt, and landscape debris daily. All garbage
containers at clubhouse and surrounding area must be emptied daily.
2.24.2 Exterior lighting working and scheduled properly. Report needed repairs
to the City’s PW Facility Maintenance Division.
2.24.3 All signage accurate and readable.
2.24.4 A threshold of 50% has been set for disease and weeds 60% for insects.
Spot spraying by location basis only when thresholds are exceeded. Any
use of pesticides must conform to the IPM policies and procedures.
2.25 NETS/FENCES/GATES
2.25.1 The Contractor will be responsible for net repair and material costs on
holes 3,6,10, and Driving Range.
2.25.2 All fences and gates shall be inspected regularly with repairs made as
needed to ensure a safe, secure and aesthetically pleasing condition at all
times, no holes in fences. Repairs and materials are the responsibility of
the Contractor.
2.26 POND MAINTENANCE
2.26.1 Algae and cattail control program shall be maintained as approved by the
GSM.
2.26.2 Pond shall be inspected daily with all visible litter/trash removed upon
detection.
2.26.3 Pond water levels shall be maintained to ensure bank stability and
aesthetic.
Attachment B
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2.26.4 Properly marked as water hazard.
2.26.5 A threshold of 25% on Aquatic weeds.
2.27 CONSTRUCTION AND/OR REMODELING OF GOLF COURSE
Any and all changes in the physical characteristics of any portion of the
course or structures such as addition or removal of sand traps, trees,
water hazards, native vegetation or other features shall require prior
approval by the GSM.
The Contractor will be paid for time and materials for any golf course
renovation or construction work not listed in this scope of work. Quotes will
be submitted to the GSM for approval with itemized list of individual job
classifications, their time and hourly rate expense. (Complete Table 3,
Attachment C-1). Material will also be added along with any other
expenses to complete the Project.
Time and Material rates to be included within bid proposal. (Include on
Attachment C-1; Table 3, Schedule of Rates)
2.28 PRACTICE AREA / DRIVING RANGE MAINTENANCE
2.28.1 Turf shall be mowed weekly or as required at agreed-upon height by the
GSM.
2.28.2 General turf maintenance shall conform to procedures outlined in
Sections 2.11/Greens, 2.13/Tee Maintenance, and 2.15/Roughs
Maintenance.
2.28.3 All Artificial Turf will be inspected weekly and repaired at the designated
Range closure time which is 5:00am -8:30 am every Thursday or at a time
which is approved by the Pro Shop Manager.
2.28.4 Light topdressing will be done once annually followed by brushing to
maintain integrity of Artificial Turf. Supplemental brushing required every 6
months.
2.28.5 Practice Bunker will have at least 4 inches of sand and kept trimmed and
edged. Bunker edges that are raised due to excessive sand build up will
be lowered by the Contractor when they reach one and a half feet over
original grade. Practice Bunker will be raked daily.
2.29 EXTERIOR OF THE CLUBHOUSE, RESTROOM BUILDINGS, and
STORAGE FACILITY
Attachment B
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The City will be responsible for the repairs and maintenance of the building
exteriors and interiors of the Clubhouse, Restrooms and Storage Facility.
2.30 GOLF COURSE WETLAND AREAS
Wetland areas shall not be disturbed by vehicular traffic, fertilizers,
pesticides and equipment. Litter and debris must be removed daily.
Wetland signage must be clean, readable and placed along both sides of
Wetlands. Replacements of all signage will the responsibility of the
Contractor.
V. GENERAL CONDITIONS
A. Permits/Parking
The Contractor shall be issued a free maintenance permit from the City's
Department of Transportation. This will allow the Contractor's crews to
use City parking facilities at no charge during the term of this contract and
only while doing landscape maintenance work for the City's Open Space
and Parks Division.
B. Payments and Inspection
Payment will be made for work satisfactorily completed as called for in this
contract. The City's Representative shall inspect and notify the Contractor
of any unsatisfactory work. Unsatisfactory work shall be corrected within
24 hours. The Contractor or the Contractor's representative shall meet
with a representative from the City at least once a month during the life of
this contract to inspect Work performed.
The Contractor will bill the City by the 5th of the month following service.
The City will pay the Contractor on a monthly basis for labor, equipment
and materials provided during the monthly billing period.
C. Use of Sanitary Landfill
The refuse disposal facilities of the city of Palo Alto Sanitary Landfill
located adjacent to East Embarcadero Road in said City will be made
available to the Contractor through the 2011 calendar year for the disposal
of all trees, rubbish and construction debris generated on work site. The
Contractor shall pay all dump fees. The Contractor shall at its sole
expense load, haul and deposit said rubbish and debris during normal
landfill operating hours. All landfill regulations will apply to all debris
deposited by the Contractor. Any questions regarding landfill rules and
regulations shall be directed to the Landfill Supervisor. A digest of the
refuse disposed area rules and regulations have been appended to this
contract. At the end of the 2011 calendar year, the Contractor shall at is
Attachment B
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sole expense load, haul and deposit all rubbish, debris and green waste to
a transfer station located at the City of Sunnyvale.
D. Spare the Air Days
The Contractor must comply with regional “Spare the Air”
recommendations on designated “Spare the Air Days” that occur
throughout the year. At a minimum, no gasoline powered equipment shall
be used after 10 a.m. on “Spare the Air Days”. The Project Manager will
notify the Contractor when a “Spare the Air” alert has been designated.
The Contractor must coordinate work schedules to accommodate “Spare
the Air” recommendations.
SCOPE OF SERVICES
04/01/2014to 04/31/2015 [During Construction]
Daily Inspections:
Daily safety inspections by Valley Crest will continue around the Clubhouse, Parking
Lot, Maintenance Facility, Breezeway, Range, and Embarcadero Road. Valley Crest will
promptly repair all problems that are under their responsibility, and will notify Facility
Management for repairs that are outside of their scope.
Practice Green, Surrounding Lawns, and Irrigation:
This area will require daily mowing or rolling of putting green, daily cup rotation,
fungicide and herbicide applications as needed, aeration 1x fall, fertilizer 2-3x monthly,
irrigation adjustment and repairs, lighting adjustment and repairs, weeding, tree care, and
program irrigation.
Clubhouse Surrounds:
Daily clean up of asphalt and concrete paths around clubhouse and length of range tee,
parking lot, blow and debris clean up, all waste containers emptied, weeding, trimming,
catch basin clean out, and inspection and report to City Staff.
Attachment B
Parking Lot:
Asphalt repair, daily clean up, Oleanders around perimeter trimmed and clean, all signage
to be clean, weeding by mechanical, herbicide, and biological as needed, mulching.
Landscape and Planters around Clubhouse:
New irrigation added as needed, additional plantings to replace dead or dying plants,
fertilizer, weeding, trimming, woodchips, and tree care.
Embarcadero Road:
Tree care, turf maintenance, mowing 2x week, fertilizer, irrigation repair and
adjustments, curb edging 1x week
Driving Range Natural Turf – mowing 1x per week, aeration, fertilizer, and irrigation
programming and repair
Driving Range Synthetic Turf –Topdressing and grooming once during the construction
period, debris clean up 1x a week, weekly repairs to all driving range infrastructure
(drainage, fence, synthetic turf, etc) and tree work as necessary.
Practice Bunker:
This bunker is to be raked daily and sufficient sand added to hit safe shots
Maintenance Facility:
All buildings and yards to be kept clean, safe, weeded, trimming, catch basins protected,
pressure washer and pad working and clean.
Wildlife Preservation—fox dens, nests, raptures, etc. Insure that these sensitive areas
are monitored, protected, proper signage, fencing, and City is notified if wildlife is in
danger.
Squirrel and Gophers:
Trapping and eradication of gophers and squirrels is ongoing through all phases of
construction.
Cement Catch Basins:
All cement basins to be routinely inspected and cleaned of debris once during
construction and once at the end of construction.
Equipment for Maintenance
Golf equipment will be the responsibility of Valley Crest Golf for all 3 phases (Pre
Construction, During Construction and Post-Construction) of the contract.
Attachment B
Audubon work to continue to get Palo Alto certified (this work would hopefully
continue)
ValleyCrest will research best options w/Audubon and complete.
Grow-In Management:
As the golf course construction contractor completes segments of the new golf course,
Valley Crest will take over maintenance responsibility. This work would include
application of fertilizers, fungicides, amendments, mowing, and irrigation. Valley Crest
will provide an estimate for monthly pricing.
Total variable cost is a fixed amount for the period. Individual monthly costs are subject
to change based on the square footage maintained each month.
Please note that if the grow-in time frame extends beyond the 5-month projection the
month-5 pricing will apply for any extended grow-in period.
Serve as CITY Consultant and assist in overseeing daily golf course construction
CONTRACTOR to provide a monthly rate of $5,025 for consulting and inspection work.
Native Area (weed undesirable plants, and program water efficiently)
N/C – expenses under Wildlife Preservation section.
SCOPE OF SERVICES
05/01/2014 to 04/30/2018 [ Or Later and After Construction]
The Scope of Services will return back to the Original Scope of Services, with the following amendments
listed below:
1.3.1
Rodent control will be performed by trapping. Baiting or fumigant use is prohibited
unless authorized by the GSM in consultation with the IPMC. Trapping will be
performed using devices that are preapproved by GSM using humane trapping
procedures in order to minimize stress or animal discomfort. Trapping of gophers and
ground squirrels will be ongoing throughout the year unless other (City approved)
methods have been implemented by the GSM. If there is no evidence of rodents, trapping
may be suspended (upon approval from the City) until activity is seen.
Biological controls will be based upon sound information such as that
provided by the University of California. The CSD staff will provide site
specific historical data for known infestations. Bee and Yellow Jackets will
be the responsibility of the City. GSM will be notified of their presence.
Attachment B
The Contractor is responsible for obtaining all required permits and maintaining the
required usage documentation and to comply with all requests from the Santa Clara
County Agricultural Department to inspect records, licenses, training certificates, bay
area pesticide limitation maps, equipment, and storage facilities. All applicable
regulations shall be strictly adhered to, and all required reporting shall be the
responsibility of the Contractor.
1.7.1
A minimum of ten (10) full-time equivalent maintenance employees, (or 400 hours per
week) between March 1st and October 30th, and eight (8) full-time equivalent
maintenance employees (or 320 hours per week), between November 1st and February
28th, shall be assigned to work solely at the Golf Course and shall not be assigned duties
or responsibilities at other sites nor shall they be rotated between other sites that are
maintained by the Contractor. The Contractor may use temporary employees in case of
absences or emergencies, if those employees are trained in golf course maintenance,
etiquette, and are in uniform in accordance with applicable standards.
The Contractor may use temporary employees in case of absences or emergencies if those
employees are trained in golf course maintenance, etiquette, and are in uniform and as
otherwise will comply with industry standards.
The Contractor’s staff, who will be assigned to duties at the Golf Course, shall be life
scanned before they will be permitted to commencing work on behalf of the Contractor at
the Golf Course. The Contractor will confirm, in writing, that applicant has passed
requirements set forth by the City, upon request of the GSM.
2.6
IRRIGATION SYSTEM
The Contractor will assume all responsibilities for maintenance and repair of all 2 inch
and smaller pipe and all components of the irrigation system such as sprinkler heads,
lateral valves, valve boxes, restraints, gaskets, swing joints, quick couplers, lateral
mainline saddles, electrical, controller satellites, and hardware of the Golf Course
irrigation system. All expenses for parts and labor will be paid for by the Contractor.
When replacing steel nuts and bolts the Contractor will use only highest grade stainless
steel. All components will be replaced with same manufacture and models as components
being replaced unless otherwise approved by GSM. The City will be responsible for all
mainline irrigation greater than two inches. In the event of a mainline failure, or any
unforeseen incident that leaves the city attending to other priorities and unable to
immediately repair the failure, Valley Crest may be asked to assist in the repair to
eliminate the loss of turf. All mainline repairs will be reimbursed by the City.
2.6.1.7
The Contractor shall monitor reclaimed water and potable water use daily.
Reclaimed water shall not exceed 65% and potable water costs shall not exceed
$250,000. The Contractor shall notify GSM if these costs are anticipated to exceed
$225,000. As
Attachment B
conditions dictate GSM may approve additional potable or recycled water use.
2.6.2.6
All satellite controller enclosures must be painted or replaced as needed to
maintain a good appearance. Pump station maintenance will include weed
control, good appearance, proper signage, and rust preventative paint applied to
motor platforms every 2 years.
2.7
ANIMAL AND RODENT CONTROL
The Contractor shall provide an ongoing trapping program to control and eradicate
rodents and other animal pests as necessary to prevent hazards, holes and destruction of
plantings on golf course property in accordance with the Golf Course IPM Plan which
will be drafted annually and following specifications for rodent control. Damage to
public or private property due to erosion as a result of rodent activity shall be repaired at
the Contractor’s expense.
The Contractor will use reasonable efforts to several times daily remove the geese from
the Golf Course. The use of a trained dog or dogs shall be used a minimum of three times
daily at least 5 days a week, along with other reasonable and City approved methods for
moving geese. A request to the Palo Alto Airport Tower for clearance permission will be
asked before any attempt is made to move geese. Only after their approval that it is “safe”
will attempts be made to move geese. Goose guano shall be cleaned on an as-needed
basis on the Tees, Greens, Approaches, Fairways, and Cart Paths, using best management
practices. All Greens will be clean of guano before the first group of players arrive to
play it.
2.11.1
Greens shall be mowed 5 times a week in the summer (March 1 – October 31) and a
minimum of three (3) times per week during the winter (November 1 – February 28) with
an approved greens reel type mower at a height of 125 or as recommended by the
superintendent and approved by the GSM. Riding Greens mowers will have hydraulic
detection alarms. Frequencies and height of cut may be modified from time to time as
deemed necessary by the golf course superintendent with the prior approval of the GSM.
All grass clippings must be collected and removed from the site during each mowing
operation, including dispersed in a method to prevent unplayable conditions. Greens will
be rolled on days when not mowed. Rolling can be substituted for mowing as conditions
dictate. Greens must be mowed, and rolled if performed, prior to first golfer of day
reaching each respective green, including the putting green. Care will be given on clean-
up lap mowing to reduce turf loss and playability.
2.13.7
Tees currently are at a 25% weed threshold. They will be set at 10% weed threshold for
the new course and disease threshold will remain at 25%
2.14.4
Attachment B
Fairways are currently at a 35% weed threshold and will be reduced to 15% weed
threshold for the new course. Disease threshold will remain at 25%.
2.15.5
Diseases Thresholds for rough will go from at 50% weed threshold to 40% weed
threshold. Disease thresholds will remain the same.
All pricing is subject to change if any material differences to golf course plans, take-offs,
frequencies, standards etc. are required.
Additional Changes to Scope of Services
The parties may adjust the Scope of Services as needed by mutual written agreement of
the Project Managers for CONSULTANT and CITY so long as all work is completed
within the term of this agreement.
Upon Post Construction section numbers 2.13.6, 2.14.3, and 2.26.1 thru 2.26.5 will no
longer apply
Attachment B
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EXHIBIT C
SCHEDULE OF FEES
The City shall pay the Contractor for the completion of Services performed to the reasonable satisfaction of
the City, a not-to-exceed sum in accordance with the schedule below. Any Services provided or hours
worked for which payment would result in a total exceeding the maximum amount of compensation set
forth herein, without the prior authorization of the City, shall be provided at no cost to the City.
A. Schedule of Payment:
The City shall pay the Contractor a maximum compensation amount of One Million Eight Hundred
and Fifty Thousand Dollars ($1,850,000.00), payable over the Term, for the Services performed, based
on the current Golf Course configuration as of the Effective Date, as follows:
Year One, November 1, 2010 through April 30, 2011: $350,000.00, in monthly
increments of $58,333.33.
Year Two, May 1, 2011 through April 30, 2012: $750,000.00 in monthly increments of
$62,500.00.
Year Three, May 1, 2012 through April 30, 2013: $750,000.00 in monthly increments of
$62,500.00.
If the City fails to make any monthly payment within thirty (30) days of the receipt of the same, then the
Contractor may give the City thirty (30) days’ prior notice of termination, in writing; provided, however, if
the City makes payment to the Contractor before the effective date of the notice of termination, then the
notice of termination shall be deemed cancelled, the Contractor shall continue thereafter to perform the
Services, and the notice of termination shall be deemed rescinded.
B. Equipment Purchase
Compensation for equipment purchased by the Contractor shall be based on the Contractor’s purchase
of the City’s existing Equipment as listed on Attachment 5 of RFP 136681and attached herein as
Attachment 1, for a Lump Sum Total Payment of $125,000.00, to be paid November 1st, 2010.
Contractor will be solely responsible for the equipment as of November 1st, 2010.
CONTRACTOR shall purchase from CITY, all other usable equipment, materials, tools and supplies at
the City’s Cost, based on inventory taken at transition. A third party Furniture, Fixtures and Equipment
consultant will value the remaining supplies, materials and minor tools and equipment at the Golf
Course that are related to Golf Course maintenance. ValleyCrest agrees to pay the City for the usable
equipment, materials, tools and supplies, in the amount of the independent Furniture, Fixtures and
Equipment Consultant valuation by November 1st, 2010.
C. Additional Services
Additional work not defined in the Scope of Services, on a Time and Materials basis, will be agreed
upon by the Contractor and the City at the following hourly rates:
Project Manager $60
Foreman $40
Irrigation Technician $30
Equipment operator $25
Truck Driver $25
Laborer $20
Attachment B
Pricing to remain the same through April 2013 under Current Agreement ($750,000/year):
Month to month pricing under Amended or New Agreement if course remains open - up to one year ($750,000/year). If course
remains open after this initial one year period monthly pricing plus CPI (Consumer Price Index for all Urban Consumers - San
Jose/Sunnyvale/Santa Clara) will apply for up to six additional months.)
Schedule of Fees, starting 05/01/2013 forward [Pre Construction]
The City shall pay the Contractor for the completion of Services performed to the reasonable satisfaction of the City, a not-to-exceed
sum in accordance with the schedule below. Any Services provided or hours worked for which payment would result in a total
exceeding the maximum amount of compensation set forth herein, without the prior authorization of the City, shall be provided at no
cost to the City.
A. Schedule of Payments:
The City shall pay the Contractor a maximum compensation amount of 750,000 per year. After April 2014 price will be adjusted
according to CPI.
05/01/2013 to 04/30/2014 [ Pre Construction]
May $67,255/month
June $68,036/month
July $58,237/month
August $56,094/month
September $84,746/month
October $64,605/month
November $46,825/month
December $57,591/month
January $49,507/month
February $54,447/month
March $74,391/month
April $68,266/month
Subtotal $750,000
Attachment B
Schedule of Fees During Construction
Pricing for the tasks in the construction phase are priced on the assumption that ALL of the related tasks are included in the contract
scope and that any changes in scope may increase the other prices to cover fixed overhead expense such as superintendent, etc. If the
construction time frame extends beyond the 12 month projection the fixed monthly pricing will apply for the extended construction
period. There may be a period of time where construction maintenance services overlap with grow-in services. In that case, the
construction pricing will be prorated per day for any partial month.
Monthly Price
Supervision & Labor $12,022
Materials $1,587
Equipment Mntnc. & Operation $1,400
Equipment Investment $2,075
General & Administrative $1,074
Totals $18,158
$127,106 for total of seven months of golf course closure for construction
Grow-In Management:
FIXED COSTS Month 1 Month 2 Month 3 Month 4 Month 5 Totals
Supervision & Labor 18,956 33,973 28,851 39,959 36,363 158,102
Equipment Mntnc & Operation 1,498 2,651 3,803 5,532 5,532 19,016
Equipment Investment 2,420 2,420 2,420 2,420 2,420 12,100
General & Administrative 1,314 1,314 1,314 1,314 1,314 6,570
Total Fixed Costs 24,188 40,358 36,388 49,225 45,629 195,788
VARIABLE COSTS
Materials 79,677 38,863 37,941 33,554 29,177 219,212
Total Variable Costs 79,677 38,863 37,941 33,554 29,177 219,212
Total 103865 79221 74329 82779 74806 415,000
The total expenditures during the golf course reconstruction April 2014 to April 30 2015
$542,106 t
Attachment B
05/01/2015 to 04/30/2018 [Or Later and After Construction]
If the City fails to make any monthly payment within thirty (30) days of the receipt of the same, then the Contractor may give the City
thirty (30) days’ prior notice of termination, in writing; provided, however, if the City makes payment to the Contractor before the
effective date of the notice of termination, then the notice of termination shall be deemed cancelled, the Contractor shall continue
thereafter to perform the Services, and the notice of termination shall be deemed rescinded.
Post Construction Work:
ValleyCrest to provide updated pricing based on maintaining the new golf course design provided by Forrest Richardson and
Associates and the new amendments listed below.
Yearly Total Monthly Price
Supervision & Labor $445,448 $37,121
Materials $191,113 $15,926
Equipment Mntnc. & Operation $60,248 $5,021
Equipment Investment $83,873 $6,989
General & Administrative $15,580 $1,298
Totals $796,262 $66,355
Initial yearly/monthly pricing shall be fixed for the first 18 months thereafter CPI (Consumer Price Index for all Urban Consumers –
San Jose/Sunnyvale/Santa Clara) will be applied on a yearly basis, according to Contract, page 2, Section 6, Compensation During
Additional Terms.
Pricing does not include overseeding. Overseeding costs would be based on seeding/fertility rates and seed costs. This would be an
extra cost item requiring Owner’s authorization.
Specific sections that were amended are referenced in this document by the use of the numerical order used in the original
scope of work.
Daily Inspections:
$1,064/month
Practice Green, Surrounding Lawns, and Irrigation:
$3,161/month
Attachment B
Clubhouse Surrounds:
$829/month
Parking Lot:
$521/month
Landscape and Planters around Clubhouse:
$780/month
Embarcadero Road:
$1,042/month
Driving Range Natural Turf
$555/month
Driving Range Synthetic Turf
$610/month
Practice Bunker:
$357/month
Maintenance Facility:
$372/month
Wildlife Preservation
$519/month
Squirrel and Gophers:
$822/month
Cement Catch Basins:
$1,052/month
Equipment for Maintenance
$1,447/month
Attachment B
Superintendent consulting and overseeing daily golf course construction
$5025/month
Audubon work to continue to get Palo Alto certified
ValleyCrest will research best options w/Audubon and complete.
Variable Costs
Total variable cost is a fixed amount for the period. Individual monthly costs are subject to change based on the square footage
maintained each month.
Please note that if the grow-in time frame extends beyond the 5-month projection the month-5 pricing will apply for any extended
grow-in period.
Native Area (weed undesirable plants, and program water efficiently)
N/C – expenses under Wildlife Preservation section.
Attachment B
Exhibit H
Page 1 of 9
ValleyCrest Golf Course Maintenance Grow-In Overview
The typical golf course development process unfolds in a series of steps including (generally
speaking) land acquisition, permitting, golf course design, hiring of strategic personnel,
construction of the course and related structures, golf course grow-in and pre-opening activities.
While each of these steps is a discreet phase, they produce the best result when viewed and
managed as one indivisible process. Good relations and a spirit of teamwork between all parties
related to the development process is important to a successful and timely completion. This
means that each party understands the role he and everyone else plays and that each party can
envision the whole project as it progresses from one phase into another.
The grow-in phase of the process is critically important. At its’ commencement, the golf course
is about 75% complete, thus grow-in can rightly be described as “Icing the Cake”. And, like cake
icing, it takes place at a critical moment, i.e., just before serving. A good grow-in can add beauty
and support to a good design and quality construction, bringing the golf course alive with turf
cover and into proper relation with its surroundings and intended use. Conversely, a poor grow-
in can severely damage all good work preceding it, imperil a successful opening and cause
operating problems for years.
Prior to and throughout the grow-in phase of development, we envision that ValleyCrest Golf
Course Maintenance will be interacting closely with other parties to the development and
construction process, including:
1. Golf Course Architect and Project Engineers
2. Golf Course Contractor
3. Irrigation Designer and Contractor
4. Golf Course Owner
5. Golf Course Operator (If Other Than Owner)
ValleyCrest Golf looks forward to discussing the appropriate relationships with ourselves and the
above parties that will provide the overall outcome a particular project desires. Establishing
relations and operating understandings between all parties as early as possible will assure that the
project’s grow-in goals and deadlines are met and that the golf course is delivered to its owner in
optimal condition for the start of play.
Attachment B
Exhibit H
Page 2 of 9
ValleyCrest Golf’s primary goal as “Grow-In Partners” is to:
Serve the project by successfully growing-in the subject golf course, while earning a fair profit;
Given the site-specific nature of each project, it is difficult in the abstract to commit fully to a
specific set of grow-in specifications. Once a project is specifically identified and scheduled,
ValleyCrest Golf Course Maintenance can better provide such documents, which will define the
technical, administrative, management and financial requirements of each project.
For purposes of this document, we are pleased to provide the following guideline defining a
“standard” for grow-in processes and commitments.
ValleyCrest Golf Course Maintenance; Grow-In Guidelines
Scope of Services
ValleyCrest Golf will staff and supervise all services required to grow-in a subject golf
course property, commencing at course architect/city representative construction “sign off”
(acceptable stand of grass). In coordination with the Construction Manager, ValleyCrest
Golf will work directly with the Golf Course Construction Superintendent and/or Owner
Representative in the coordination of all schedules, plans, programs, etc. during this period.
Golf course grow-in can be broken down into two distinct phases: Pre-Grassing and Grow-in
Management. The Pre-Grassing will be the responsibility of the golf course Architect and
the General Contractor. As Grow-In Contractor, ValleyCrest Golf’s formal grow-in
responsibilities are for Grow-In Management, under which our services shall include:
Grow-In Management
This phase incorporates all turf grooming and maturation functions. During Grow-in
Management, the turf grass areas are groomed and managed to develop into the defined golf
course playing surfaces such as greens, tees, fairways, etc.
ValleyCrest Golf will provide all Technical Specifications, related documents and work
plans for the successful grow-in of the golf course. It is the responsibility of the ValleyCrest
Golf Grow-in Superintendent to deliver the requirements of the Technical Specifications. All
functions performed by the Superintendent will be executed in such a manner as to insure
the greatest outcome for a successful grow-in of the golf course. Such items include:
fertilizer applications, pesticide applications, irrigation modifications, mowing frequencies,
variance in timing of any scheduled tasks, as well as any other actions that would impact the
grow-in phase of this project.
Attachment B
Exhibit H
Page 3 of 9
An overview of ValleyCrest Golf’s Grow-In Management responsibilities include:
1. Develop overall agronomic grow-in plan which addresses irrigation, fertility,
pesticide application, cultural requirements, and grooming
2. Develop a manpower plan to determine workforce requirements based upon
maintainable acreage of golf course
3. Provide on-site supervision to insure all pre-grassing and grassing steps are
successfully implemented.
4. Develop formal and informal lines of communication with Construction Manager to
insure continuity of field operations.
5. Monitor turf establishment to determine first mowing opportunities per area.
6. Review/modify fertility and pesticide programs to insure turf health and vigor.
7. Monitor turf establishment and grooming against opening date to determine schedule
accuracy.
8. Work with golf course Architect to establish all area heights of cut. i.e. greens, tees,
fairways, collars approaches, roughs, etc.
Duties to be performed by ValleyCrest Golf related to Grow-In Management are as follows:
1) SCHEDULE
a) Prior to the completion of planting on each hole, the Golf Course Construction Contractor shall
notify the Owner to inspect the work in place. The Golf Course Construction Contractor shall
prepare a sign-off sheet which will be filled out prior to completing the planting of each hole. The
sign-off sheet will also be used to record inspection of the quality of materials and installation for
each hole planted.
b) Immediately after all areas have been planted, the Golf Course Construction Contractor will water
the planted areas sufficiently to seal the soil around the sod/sprigs/seed. The Contractor will not
allow the sod/sprigs/seed to go without water for more than one (1) hour after planting.
c) Grow-in by ValleyCrest Golf Course Maintenance begins immediately after acceptance
(acceptable stand of turf/first mowing stage) by Owner and continues until the course opens for
play. This time is generally 12 to 20 weeks. Since not all areas of the golf course are turned over
to the grow-in contractor at one time, the Owner should anticipate the grow-in process taking +/-
24 weeks.
d) Climatic factors (i.e. Temperature, light and water) and management factors (i.e. Irrigation,
fertilization, mowing, pest control and top-dressing) affect grow-in, therefore knowledge and
experience of this critical phase of golf course grassing is a necessary prerequisite.
Attachment B
Exhibit H
Page 4 of 9
e) Great care will be exercised during the grow-in period to ensure the success of the project. Carts,
mowing equipment, feet, etc. can track contaminates onto greens. Equipment will be washed
before mowing different areas. Excessive traffic from off the greens surrounds onto the greens
will also be avoided.
2) GROW-IN PROGRAM
a) Greens
i) Irrigation – Sod/sprigs and or seed will be to avoid allowing them to dry out and
continually there after. Irrigation cycles will be brief and frequent for the first 2-3 weeks,
5-6 min. cycles every 1-2 hours throughout the day is a good starting point (1 to 3 turns).
Close attention will be paid to areas needing more water. Irrigation at night is
recommended but frequency will be less due to lack of solar radiation. Irrigation cycle
run times will not cause erosion or cause damage to finished grade. High areas will tend
to dry out quicker than low areas. The low areas will have the tendency to hold water
and thus puddle if over irrigated, every effort will be made by ValleyCrest Golf for this to
be avoided. Hand watering will be utilized for hard to managed areas. After
sod/sprigs/seed green up and new leaf & root growth begin to emerge the frequency of
cycles will decrease with a corresponding increase in the amounts of water for deeper
watering eventually reaching daily watering usually between 2-3 weeks. This will help to
encourage a deeper stronger root system. Sod areas will be watered also, however the
frequency and duration will be adjusted to accommodate their developed root structure
relative to the newly planted greens. Care will be taken not to let the sod dry out.
ii) Fertilization – Greens should have had a pre-planted fertilization and pH buffering added
prior to planting. Fertility and pH levels will be closely monitored and adjusted as
needed. Optimum pH range is 6.0-7.0. Each fertilizer application will be applied with a
walking rotary spreader and watered in immediately to avoid turfgrass burn. Soil tests
will be conducted every month to monitor the Phosphorus, Potassium, Calcium, and
micronutrient levels. See Agronomic Plan for complete program details.
iii) Mowing – Mowing will not begin until the root system has begun to emerge and tack
down. At this time watering will have begun to decrease lessening the potential for
overly wet areas. This will help keep the sod/sprigs/seed from being removed during the
mowing process and increase survivability. A waiting period of approximately 30 days
for this root development is recommended, ValleyCrest Golf will not disturb the surface
to the point that they are mowing sand & debris which would dull the mowers. Dull
mowing equipment will be avoided at all costs. Regular reel/blade sharpening will be
performed during the grow-in period. In addition mowing the day after top-dressing will
be avoided. The first mowing (approx. 30 days) will be at a height of cut of
approximately .2” without baskets. A walking mower with solid rollers would be the
preferred equipment choice. A triplex riding mower may be used later in the grow-in but
care will be taken to avoid disturbing finished grades during the turning process.
Mowing later in the day would help to eliminate the build up of sand, clippings, etc. from
the rollers. The HOC will be lowered weekly by .010” until reaching the desired hoc of
.140”-.100”. Scalping will be avoided and adjustments will be made if this occurs.
Mowing frequency will begin at every 2-3 days and gradually increase to daily.
Direction of mowing will be changed each mowing. A clockwise rotation will be used.
Care will be made not to remove more than 30% of leaf surface each mowing.
Adjustments to HOC based on growth rate will be made with this in mind. After 6-8
weeks the installation of brushes onto the mowers may occur or mowing heads with a
grooming attachment will be used to control grain and thatch build-up.
Attachment B
Exhibit H
Page 5 of 9
iv) Top-Dressing – Top-dressing is critical to establish a smooth surface. Greens top-
dressing will begin soon after planting (first four weeks). Topdressing will be light and
frequent (approx. 1/12 inch per application). The material used will be the same as the
construction mix. A rotary style top-dresser will be used. VCGCM will spread material
light enough so that dragging is not needed, sand will be watered in with an irrigation
cycle. To develop a smooth surface, greens will be rolled soon thereafter. Sod will also
require top-dressing. Seams between sod slabs will be filled and leveled. Rolling the sod
to ensure good soil contact shall be a part of this process.
v) Verticutting – Verticutting of the greens may need to be done during the grow-in phase.
If it is deemed necessary it will be light in nature. ValleyCrest Golf shall utilize carbide
tip blades on a triplex greens mower without baskets. The setting shall be very shallow
to insure that the soil layer is not disturbed. The clippings can be cleaned up with a
triplex greens mower. A light top-dressing shall be preformed after verticutting. The
timing of this would be approximately in the 6-8 weeks after planting. ValleyCrest Golf
may substitute mowing with groomers 1-2 times a week if verticutting is not practical.
vi) Rolling – Periodic rolling of the putting surfaces shall be practiced on a minimum of a
weekly basis. The mowing in the morning may be skipped on the morning the greens are
rolled. Rolling the day after topdressing is also part of this program.
vii) Aerification – As with all new putting surfaces they tend to be very firm. For this reason
an aerification may be scheduled 2-3 weeks prior to opening. The overall health of the
turf would be a determining factor on whether this would be advisable. The root
structure will be established enough so as not to tear up the surfaces. A walking aerifier
with 1/4” tines will be used. The plugs will be broken up with verticutters and
reincorporated back into the surface with brushes on a triplex mower. Rolling shall be
performed after to smooth the surface. Fertilizer will be applied and a light irrigation
cycle to follow.
viii) Weed Control – Greens should have been fumigated as part of construction to help with
early pest control. Areas outside these treated areas may have Ronstar (or equivalent
product) applied to help eliminate weed competition during grow-in. The use of post
emergent herbicides shall be delayed for at least the first 30-45 days. Greens surfaces
will be scouted for contaminations and weeds. If necessary, they will be removed by
hand. With warm season turf types, the perimeter of the putting surfaces will be edged
with a stick style edger to eliminate runners from the collars encroaching into the putting
surfaces.
ix) Insect Control (as necessary dependent on climatic zone and pest pressure) – A
preventative program beginning in week 2-3 for worms may include Provaunt or
equivalent. These products will be rotated and continued through grow-in. Worms or
other insects can be controlled with a variety of granular products as well. Fumigated
areas will be less of a problem but close attention will be paid to the emergence of
insects. Areas will be treated with an approved insecticide.
x) Disease Control (as necessary dependent on climatic zone and pest pressure)– Should
disease occur appropriate action will be taken to check the outbreak. In climatic zones of
greater disease pressure, a preventative program of disease management will be practiced
during periods of highest pressure for outbreak. Greens will take the highest priority.
Excessive and improper watering practices can contribute to disease pressure and will be
avoided. Adjustments to fertility may be necessary as excessive fertilizer may also
contribute to disease pressure.
Attachment B
Exhibit H
Page 6 of 9
b) Tees, Collars and Approaches
i) Irrigation – Sod/sprigs and or seed will be watered to avoid them from drying out and
continually there after. Irrigation cycles will be brief and frequent for the first 2-3 weeks.
5-6 min. cycles every 1-2 hours throughout the day is a good starting point. Close
attention will be paid to areas needing more water. Irrigation at night is recommended
but frequency will be less due to lack of solar radiation. Irrigation cycle timing will not
cause erosion or cause damage to finish grade. Each area may be unique and close
attention will be observed. Excessive irrigation to green surrounds can cause washouts
around bunkers and will be avoided. High areas will tend to dry out quicker than low
areas. The low areas will have the tendency to hold water and thus puddle if over
irrigated, this will be avoided. Hand watering will be utilized in hard to managed areas.
Head coverage will be observed to correct any under-lapping or over-lapping of head
coverage. After sod/sprigs and or seed green up and new leaf & root growth begin to
emerge frequency will decrease and the amounts of water will increase for deeper
watering eventually reaching daily waterings between 2-3 weeks after planting. This will
help to encourage a deeper stronger root system.
ii) Fertilization – All areas should have had a pre-planted fertilization and pH buffering
added prior to planting. Knowledge of the pH levels prior to the planting are essential to
a good grow-in fertilization program. Fertility and pH levels will be closely monitored
and adjusted as needed. Desired pH range is 6.0-7.0. Water will be applied after each
application to lessen the potential for foliar burn. Applications to tee tops will be with
walking rotary spreader to maintain a level tee surface. Balance of areas will use a
tractor driven rotary spreader. Perimeters of bunkers will be hand walked to assure that
the edges are fertilized properly. See Agronomic Plan for complete program details.
iii) Mowing – Mowing will not begin until the root system has begun to develop. This will
help keep the sod/sprigs and or seed from being removed during the mowing process and
thus increase survivability. A waiting period of 30 days for this root development is
advised. Mowing any earlier might disturb the surface and would definitely lead to
mowing sand which would dull the mowers. At this time watering will have begun to
decrease lessening the potential for overly wet areas. Dull mowing equipment will be
avoided at all costs. Regular reel/blade sharpening will be performed during the grow-in
period. If rotary mowing equipment is used care will be used in regards to mower deck
discharge. If a mulching position is not available, the discharge area of the deck will be
away from bunkers & putting surfaces. The first mowing (approx. 30 days) will be at
approximately .750” without baskets. A walking mower with solid rollers would be the
preferred equipment of choice. A triplex riding mower may be used but care will be
taken to avoid disturbing finished grades during the turning process. Mowing later in the
day would help to eliminate the build up of sand, clippings, etc. form the rollers. The
HOC will be lowered .10” per mowing every 2 weeks until reaching the desired HOC of
.450”-.500”. Scalping will be avoided and adjustments must be made if this occurs.
Mowing frequency will begin at every week and gradually increase to 2X weekly.
Changing the mowing direction each mowing will be performed. Care will be made not
to remove more than 30% of leave surface each mowing. Adjustment to HOC based on
growth rate will be made with this in mind.
iv) Top- Dressing – If installed, sod will require some top-dressing. Seams between sod
slabs will be filled and leveled. Rolling the sod to ensure good soil contact will be a part
of this process. This will also help with leveling and smoothing the sod areas. Up to
600#/1,000 sq ft of topdressing may be applied only under the sodding pricing option.
v) Weed Control– Tees, collars and approaches may have been fumigated to help with early
pest control. Areas outside these treated areas will have Ronstar (or equivalent) applied
to help eliminate weed competition during grow-in. VCGCM will delay use of post
Attachment B
Exhibit H
Page 7 of 9
emergent herbicides for at least the first 30 days. Areas will be scouted for random
weeds and they will be removed by hand if necessary.
vi) Insect Control (as necessary dependent on climatic zone and pest pressure) – A
preventative program beginning in week 2-3 for worm control may include Provaunt or
equivalent. These products will be rotated and continued through grow-in. Worms or
other insects can be controlled with a variety of granular products. Fumigated areas will
be less of a problem but close attention will be paid to the emergence of insects. Areas
will be treated with an approved insecticide.
vii) Disease Control (as necessary dependent on climatic zone and pest pressure) – should
disease occur appropriate action will be taken to check the outbreak. Excessive and
improper watering practices can contribute to disease pressure. Adjustments to fertility
may be necessary as excessive fertilizer will contribute to disease pressure.
c) Fairways, Roughs, Green and Tee Surrounds
i) Irrigation – Sod/sprigs and or seed will be watered to avoid them from drying out and
continually there after. Irrigation cycles will be brief and frequent for the first 2-3 weeks
close attention will be paid to areas needing more water. Irrigation at night is
recommended but frequency will be less due to lack of solar radiation. Irrigation cycle
timing will not cause erosion or cause damage to finished grade. Each area may be
unique and close attention will be observed. Thus the green surrounds should have ½
heads watering away for the greens. This is a consideration as run times need is lessened
in relation to full arc heads. High areas will tend to dry out quicker than low areas. The
low areas will have the tendency to hold water and thus puddle if over irrigated, this will
be avoided. Hand watering will be used for hard to manage areas. After sod/sprigs and
or seed greens up and new leaf & root growth being to emerge back off frequency and
increase the amounts of water for deeper watering eventually reaching daily waterings
between 2-3 weeks. This will help to encourage a deeper stronger root system.
ii) Fertilization – All areas should have had a pre-planted fertilization and pH buffering
added prior to planting. This will be a good start to the grow-in program. Knowledge of
the pH levels prior to the planting are essential to a good grow-in fertilization program.
Fertility and pH levels will be closely monitored and adjusted as needed. Targeted pH
range is 6.0-7.0. Water will be applied after to lessen the potential for foliar burn.
Equipment of choice would be a tractor mounted rotary spreader. Perimeters of bunkers
will be hand walked to assure that the edges are fertilized properly. See Agronomic Plan
for complete program details.
iii) Mowing – Mowing will not begin until the root system has begun to develop. This will
help keep the sod/sprigs and or seed from being removed during the mowing process and
thus increase survivability. A waiting period of 30 days for this root development is
advised. Mowing any earlier might disturbed the surface and would definitely lead to
mowing sand which would dull the mowers. At this time watering will have begun to
decrease lessening the potential for overly wet areas. Dull mowing equipment will be
avoided at all costs. Regular reel/blade sharpening is required during the grow-in period.
If rotary mowing equipment is used care will be used in regards to mower deck
discharge. If a mulching position is not available, the discharge area of the deck will be
away from bunkers & putting surfaces.
(1) The first fairway mowing (approx. 30 days) will be @ .750. A hydraulic
driven reel mower with solid rollers would be the preferred equipment
choice. Care will be taken to avoid disturbing finished grades during the
turning process. Mowing later in the day will help to eliminate the build
up of sand, clippings, etc. from the rollers. The HOC will be lowered
Attachment B
Exhibit H
Page 8 of 9
.10” per mowing every 2 weeks until reaching the desired HOC of .450”-
.500”. Scalping will be avoided and adjustments must be made if this
occurs. Mowing frequency will begin at every week and gradually
increase to 2X weekly. Changing the mowing direction from each
mowing is required. Care will be made not remove more than 30% of
leave surface each mowing. Adjustments to HOC based on growth rate
need to be made with this in mind.
(2) The first rough/green & tee surrounds mowing (approx. 30 days) will be
@ 1”. A rotary mower will be used. Sharp blades will be used. Blades
will be changed after each mowing. Care will be exercised not to have
the discharge from the decks directed towards putting surfaces or into the
bunkers. If equipped with mulching settings this setting shall be used.
Mowing frequency will be 1X weekly. The HOC will be raised every
month in intervals of .250” until reaching the desired HOC of 1.5” – 2” at
opening. The lower HOC will help produce density.
iv) Top- Dressing – If installed, sod will require some top-dressing. Seams between sod
slabs will be filled and leveled. Rolling the sod to ensure good soil contact will be a part
of this process. This will also help with leveling and smoothing the sod areas. . Up to
600#/1,000 sq ft of topdressing may be applied only under the sodding pricing option.
v) Weed Control – Fairways, rough, green and Tee Surrounds may have been fumigated to
help with early pest control. Areas outside these treat areas may have Ronstar (or
equivalent) applied to help eliminate weed competition during grow-in. VCGCM will
delay the use of post emergent herbicides for at least the first 30 days. Areas will be
scouted for random weeds and they will be removed by hand if necessary.
vi) Insect Control (as necessary dependent on climatic zone and pest pressure) –
Worms/grubs will be the biggest concern during grow-in. If necessary, a preventative
program beginning in week 2-3 may include Provaunt or equivalent. These products will
be rotated and continued through grow-in. Worms or other insects can be controlled with
a variety of granular products. Fumigated areas will be less of a problem but close
attention will be paid to the emergence of insects. Areas will be treated with an approved
insecticide.
vii) Disease Control (as necessary dependent on climatic zone and pest pressure) – Should
disease occur appropriate action will be taken to check the outbreak. Excessive and
improper watering practices can contribute to disease pressure. Adjustments to fertility
may be required as excessive fertilizer will contribute to disease pressure.
d) Other Grow-In Considerations
i) Sprinkler head adjustments – Sprinkler heads may require raising or lowering and is best
accomplished while the construction contractor is still on site. Heads in sprigged areas
may be installed 2”-3” above grade during grow-in and lowered before opening. This
will allow for the thatch build up and keep the heads from becoming depressions during
the grow-in phase. Arc adjustments may also be made. This is especially important
around the green complexes. With the inboard/outboard system the arcs are critical to
success and will be checked regularly and adjusted as needed. Faulty sprinkler heads will
be replaced while still under warranty. It may be necessary to relocate heads, change
nozzle size, etc. Washouts around heads need to be investigated quickly as they damage
the final grade and add additional repair efforts.
ii) Drainage Issues – Catch basin elevations may need to be adjusted. This is best
accomplished while the construction contractor is still on site. Catch basin grates will be
Attachment B
Exhibit H
Page 9 of 9
kept clean and drain lines unplugged. Additional catch basins may be needed and will be
addressed while the construction contractor is on site.
e) Bunkers
i) Bunkers edges will be kept trimmed with a stick edger to maintain a nice neat edge.
Raking will not be necessary until one month before opening. This raking will help to
settle the sand to avoid poor lies in bunkers. If determined the sand seems too loose, a
vibratory packer will be used to firm the sand. This may be particularly important on the
bunker faces. Watering with a hand held hose prior to packing will be performed if
necessary.
f) Landscaping/Trees/Native Areas
Landscape beds, trees and native areas will be checked to make sure irrigation is working
properly and watered as needed until established using the irrigation system. Trees that
have been staked will be maintained. Fertilization of landscape beds will be done after
planting to ensure the overall health and survival of plantings.
3) ITEMS NOT INCLUDED
a) All water and utilities
b) Irrigation and pump system repairs for damage not caused by Contractor
c) Sod, seed or sprigs in excess of $2,000.00 total
d) Cost other than labor for repair of washouts larger than ½ cubic yard in size
e) Damage caused by acts of God or vandalism
f) Tree trimming
g) Pre plant soil amendments and fertilization
h) Soil procurement for repairing all wash-outs and erosion
i) Damage repair for haul roads, streets, cart paths and curb created by golf course contractors other
than ValleyCrest.
Attachment B
City of Palo Alto
City Manager's Report
TO: HONORABLE CITY COUNCIL
FROM: CITY MANAGER DEPARTMENT: COMMUNITY SERVICES
DATE: OCTOBER 18,2010 CMR: 382:10
REPORT TYPE: ACTION
SUBJECT: Approval of a General Services Agreement with ValleyCrest Golf Course
Maintenance, Inc. in the Amount of $1,875,000 for Maintenance Services and
Sale of Used City Golf Course Maintenance Equipment for $125,000; and
Referral of Golf Course Financial Planning Issues to the Finance Committee
EXECUTIVE SUMMARY
Due to the ongoing fiscal challenges facing the City of Palo Alto's (City) General Fund the
Community Services Department (CSD) recommended, and the Council approved, the
exploration of "contracting out" Palo Alto Municipal Golf Course ("Golf Course") maintenance
services during the 2011 budget process. The recommendation to explore private maintenance
was also suggested in the findings of the Golf Course operational study conducted by Economic
Research Associates (ERA) in 2008. The Executive Summary of the ERA study is attached as
Attachment A.
This report describes the Request For Proposal (RFP) process for Golf Course maintenance that
has resulted in the recommendation of an award of contract to ValleyCrest Golf Course
Maintenance, Inc. (ValleyCrest) to assume Golf Course maintenance responsibilities, beginning
November 1, 2010 for a 30-month term ending on or soon after April 30, 2013 at a cost of
$1,850,000 and a purchase of used golf course equipment at a cost of $125,000. ValleyCrest is
recommended for an award of contract due to its extensive golf course maintenance services
experience, low cost proposal relative to the public maintenance option, and its commitment to
enhance the City'S existing Integrated Pest Management (IMP) program, customer service and,
most importantly, to improve the quality of Golf Course maintenance services to ensure the Golf
Course will remain competitive with neighboring golf courses. The proposed contract between
the City and ValleyCrest is attached as Attachment B.
The report also discuses related Golf Course issues that require the Council's direction and
action in the near future. The current outstanding issues include:
• The need for flood control project mitigation, not only for the physical disruption to the
Golf Course but also for anticipated revenue losses from decreased play during levee
reconstruction; and
CMR 382:10 1 of8
Attachment C
• Consideration of the establishment of an infrastructure reserve for the Golf Course to pay
for capital improvements from positive Golf Course cash flow to reduce the need for
future capital improvement-related debt.
Staff requests that these two items be referred to the Finance Committee for further discussion.
Finally, the report also discusses the intent to make coterminous both the Golf Professional
contract with Brad Lozares and the Pro-Shop lease agreement with Brad Lozares, so the
agreements will terminate concurrently in the month of April 2013. Staff will make a
recommendation to the Council before the end of calendar year 2010.
RECOMMENDATION
Staff recommends that the Council:
1. Authorize the City Manager or his designee to execute the General Services Agreement
(Attachment B) in the amount of $1,850,000 with ValleyCrest for a term of 30 months
beginning November 1, 2010 ending April 30, 2013, and the sale of used golf course
maintenance equipment (Attachment C) to ValleyCrest for $125,000; and
2. Authorize the City Manager or his designee to negotiate and execute one or more change
orders to the contract with ValleyCrest Golf, Inc., for related, additional but unforeseen
work that may develop during the project, the total value of which shall not exceed
$185,000 (1 0% Contingency); and
3. Refer to the Finance Committee the question of how staff should propose fair and
reasonable mitigation for anticipated lost revenues at the Golf Course during the San
Francisquito Creek Joint Powers Authority's (JPA) flood control project.
4. Refer to the Finance Committee the question of whether staff should develop for the
Council's approval a proposal to establish a new infrastructure reserve fund in the
amount of the annual savings above the fully loaded operating costs of the Golf Course
for the eventual replacement of anticipated infrastructure needs at the Palo Alto
Municipal Golf Course.
BACKGROUND
The Golf Course was constructed in the mid-1950's on 184 acres of flat former salt-marsh and
bay fill. The course was designed by noted golf course architect William R. Bell of Pasadena,
California. The Golf Course was designed as an 18-hole facility with a par of 72. The Golf
Course is a classic 18-hole championship course that measures over 6,800 yards from the back
tees. The facility includes a large practice putting green, a three-building Eichler-designed
clubhouse/golf shop complex and parking lot. In the mid 1970's, improvements were made to
replace the clubhouse buildings. At that time, holes 3, 10, 11, & 18 were renovated under the
direction of golf architect Robert Trent Jones, Jr.
The Golf Course is a City of Palo Alto General Fund operation. All excess revenues or shortages
are returned to the City'S General Fund. The Golf Course currently generates sufficient revenues
to support debt service, direct and indirect expenses, and City cost plan charges. There is no
reserve or replacement fund for the Golf Course, consequently; additional debt service is taken
on by the Golf Course when new capital improvement needs arise. The debt service for the
Certificates of Participation, which represents approximately $570,000 annually, will be fully
retired in June 30, 2018.
CMR 382:10 20f8
Attachment C
Presently, the City has entered into both a Golf Professional management agreement and a Pro
Shop lease agreement with Brad Lozares (Lozares) for golf operations. As a result of Internal
Revenue Services (IRS) debt issuance limitations, the management agreement and the lease for
the building are separate contracts. The management agreement includes the following
responsibilities: reservations; green fees collection; starting; and marshalling services. The lease
agreement for the building includes: responsibility for managing golf cart rentals; the driving
range; merchandise sales; and instruction services. The Lozares management agreement with the
City for operating the Golf Course expires December 31, 2010. The lease agreement with
Lozares for lease of the building expires in April 2013. The building lease also includes an
. option to extend the term of the concession 10 additional years, if the option is exercised at the
City's sole discretion.
There is also a separate lease agreement with R&T Restaurant Corporation (R&T) for food and
beverage services at the Golf Course. The R&T lease agreement for food and beverage
operations expires April 20, 2018.
Currently Golf Course turf and irrigation maintenance services are provided by CSD's Parks,
Open Space and Golf Division. CSD oversees daily turf and ground maintenance operations that
include coordination of services between the tenants and City maintenance staff in order to
provide a seamless experience for visitors to the Golf Course. The Real Estate Division of the
Administrative Services Department oversees tenant leases. The Club House and Pro Shop
building maintenance (exterior) and janitorial services are provided by the City'S Public Works
Department, Facilities Management Division.
In 2007, the City Council authorized staff to proceed with an operational analysis of the Golf
Course. The operational analysis was conducted by Economics Research Associates (ERA)
(Attachment A), and provided information on the Bay Area golf market and conditions of the
Golf Course facility; and the current and alternative operating models available for the Golf
Course.
The ERA study was presented to the City Council on November 17, 2008 (CMR: 446:08;
Attachment D). The study concluded that, despite a Bay Area wide decline in golf play, the Golf
Course performance has been relatively strong when compared with similar municipal facilities
in the market area. The recommendations to sustain the long-term viability of the golf course
program from the staff report are summarized below:
1. Retain a golf course design consultant to work with the JPA and the City's staffs to
design an environmentally friendly flood control project that will balance flood control
and recreational use solutions and also benefit the Golf Course.
2. Recalculate the Cost Plan allocation for the Golf Course to a more traditional golf
course operation allocation. This would allow for excess funds to be set aside to
establish a replacement reserve to fund ongoing minor capital improvement andlor
more intensive maintenance.
3. Align the two tenant leases and management contract so they expire concurrently. This
would allow consideration of other, potentially more effective and efficient, operating
options and a smoother transition of operation, should that be deemed advantageous in
the future.
CMR 382:10 30[8
Attachment C
4. Commit to a plan of cost-neutral capital improvements to ensure the Golf Course
remains competitive. That is, proceed with improvements that are economically
justified by increased net operating income stemming from the improvements.
5. Direct Community Services and other relevant City staff to work in cooperation with
the labor union to further evaluate the advantages and disadvantages of private versus
public maintenance.
Since the 2008 Golf Course study was presented to Council, the Golf Course has continued to
experience a decline in annual rounds of play from 74,000 in 2008, to· 72,000 in 2009, and to
68,500 in 2010. In order to keep the Golf Course financially viable budget cuts were made in
2009 and 2010 that continued to erode the resources available for the City-operated maintenance
program. Although the Golf Course managed to end FY 2010 with net revenues of $77,000, this
was achieved with a 40% reduction in staff, which is less than the level of staff needed to
provide comprehensive quality Golf Course maintenance.
As the FY 2011 budget process began, it became clear the City needed to make significant
structural budget reductions to the General Fund with an anticipated deficit of $7.3 million. As
CSD considered alternatives for budget reductions, . the "contracting out" of Golf Course
maintenance services was recommended, not only for the potential cost savings, but also to
return maintenance levels to a standard that allows the Golf Course to remain competitive with
the objective of increasing golf rounds, which has been compromised through numerous years of
program budget cuts.
Staff recommends the approval of a Golf Course maintenance services agreement with
ValleyCrest and replacing in-house maintenance staff with contract personnel. Below, staff will
provide information on the process that was used to arrive at this recommendation and will
discuss the progress and current thinking on the other recommendations listed above, stemming
from the ERA Golf Course study.
DISCUSSION
The process for exploring "contract out" Golf Course maintenance services began in spring 2010
by notifying SEIU of the City's intent to explore contract maintenance services for the Golf
Course. The City and SEIU engaged ina discussion about the City'S financial challenges and
rationale for the need to consider an alternative service delivery for Golf Course maintenance.
Although some ideas were discussed to mitigate the need for contracting out Golf Course
maintenance, such as a regional golf course maintenance agreement between several neighboring
cities, this suggestion was deemed by the City to be financially infeasible.
CSD staff prepared a detailed scope of service, with input from several other City departments
including Public Works, Utilities and Administrative Services (ASD). The Request for Proposal
(RFP) was released in June. A mandatory pre-solicitation meeting was held at the Golf Course
which included a tour of the Golf Course that allow all interested parties to walk the Golf Course
and ask specific questions during the hole-by-hole walk. Five potential bidders attended the pre
bid meeting. Four proposals were received in August when the responses to the RFP were due.
CSD assembled an evaluation panel to evaluate the proposals. The eight member panel included
members of the Golf Advisory Committee, CSD Director, Palo Alto's Golf Course
CMR382:10 40f8
Attachment C
Superintendent, Recreation Division Manager and the Parks, Open Space and Golf Division
Manager. The stated RFP criteria used to evaluate the proposals were:
A. Quality and completeness of proposal;
B. Qualifications & experience of proposer in providing Golf Course Maintenance
Services as stated in this RFP; including experience and qualifications of project
manager & key staff to be assigned to project;
C. Similar experience and expertise in the type of work required, with the City, or with
other municipal golf courses or private golf courses;
D. Demonstrated understanding of the scope of services requested, timeframes,
scheduling ability, ability to provide back up or follow up services, if needed;
E. References/Financial stability of Firm; and
F. The Cost to the City.
Of the four proposals, based on the RFP criteria above, two were determined by the evaluation
panel as more responsive to the RFP. The proposals were submitted by Lozares and ValleyCrest.
Both companies were invited to interview with the panel; the interviews occurred in September.
At the conclusion of the interviews each company was asked to provide a Best and Final
proposal with an emphasis on reducing overall costs with minimal or no impact to the scope of
services defined in the RFP. The "Best and Final" offers were received in mid September.
Concurrently, reference checks were made and, where feasible, site visits were conducted to
evaluate maintenance levels at other golf courses maintained by the firms.
At the conclusion of the RFP process ValleyCrest was unanimously determined by the
evaluation panel to have provided the most complete responsive proposal and thereby it
recommended ValleyCrest as the party to provide private Golf Course maintenance services to
the City. The factors that weighed most heavily on the ValleyCrest recommendation was the
depth of experience exhibited by ValleyCrest and the proposed overall cost savings, which is
approximately $300,000 below the Lozares' "Best and Final" proposal, and" approximately
$500,000 below what it would cost the City to continue Golf Course maintenance services in
house over the 30-month term of the proposed contract. Furthermore, the ValleyCrest
management team displayed a commitment to customer service and high quality maintenance
that the City desires for the Golf Course. ValleyCrest is very interested in working closely with
the City'S water quality control program, environmental goals and the IMP program. ValleyCrest
brings a wealth of knowledge and expertise in horticulture and agronomy that staff believe will
serve the City well as we continue push the boundaries toward excellence in Golf Course
maintenance, sustainability and environmental conservation.
ValleyCrest Golf Course Maintenance is one of five operating divisions of the ValleyCrest
Holding Co. and Subsidiaries. It is the country's largest horticulture maintenance, golf course
maintenance and construction company. ValleyCrest currently maintains over fifty golf
CMR 382:10 50f8
Attachment C
properties located in California, Texas, Florida, Georgia, North Carolina, South Carolina,
Pennsylvania, New Jersey, Massachusetts and Michigan.
Furthermore, ValleyCrest is open and enthusiastic to providing displaced City Golf Course
maintenance staff with an opportunity to join the ValleyCrest Company. Staff was very
encouraged to hear this and will work with ValleyCrest to connect displaced employees with
ValleyCrest. Of the seven regular staff affected by contracting out Golf Course maintenance four
have already made the decision to retire, one has found other employment, and one has bumping
rights per the SEIU labor agreement with the City and will move to the Parks, Open Space and
Golf division of CSD, The remaining staff member will be laid-off as of November 1, 2010;
however, staff is hopeful that a vacancy may emerge in the Parks Open Space and Golf division
over the next month that will provide an opportunity for a transition.
As CSD staff will need to maintain the Golf Course until the effective date of the transition to
ValleyCrest, the proposed negotiated sale of City-owned Golf Course maintenance equipment to
ValleyCrest is preferred for the effective and efficient transition from public to private
maintenance. The City'S Public Works fleet management staff valued the existing Golf Course
equipment, staff then negotiated a fair and reasonable price with ValleyCrest, which has agreed
to pay $125,000 for all major equipment.
As described in the contract (Attachment B), ValleyCrest will occupy the Golf Course
maintenance yard and facilities therein to deliver the Golf Course maintenance services. The City
Attorney's office, ASD Budget and Purchasing Divisions together with Risk Management
provided support in drafting the contract, including review and approval of the occupancy terms
and insurance requirements for use·ofthe City facilities and property.
A third party furniture, nxtures and equipment consultant will be retained by the City to
determine the fair market value (FMV) of all other minor items (tools, supplies and materials)
that remain at the Golf Course maintenance yard. ValleyCrest has agreed to pay for the
remaining items based on this FMV independent furniture, fixtures and equipment consultant's
valuation. This will be completed on or before November 1,2010.
Discussion of Related Golf Course Issues
The topics below relate to the staff recommendations from the 2008 ERA Golf Course study,
summarized on page 3 of this staff report and in CMR: 446:08 Operational Analysis of the City
of Palo Alto Municipal Golf Course (Attachment D) The action items before Council at this time
is the recommendation refer items 1 and 2 below to the Finance Committee for further
discussion.
1. San Francisquito Creek Joint Powers Authority -Flood Control
The Council has requested that the JP A retain a golf course design consultant to work with the
Joint Powers Authority and City staff to design an environmentally friendly flood control project
that will balance flood control and recreational use solutions and that will also benefit the Golf
Course. The JPA has been very supportive of the City's need for fair and reasonable mitigation
measures to the Golf Course for levee improvements; the impact to the Golf Course will include
the need to re-design 4 to 6 holes due to levee realignment and encroachment onto the Golf
Course. The JP A hopes to begin work in summer 2011, but the likelihood of this occurring is
CMR 382:10 60f8
Attachment C
unknown at this time. The impact and related mitigation to the physical impacts to the Golf
Course is moving in a positive direction and staff is confident that a workable win/win design
will be developed. However, the loss of City revenue during the levee reconstruction is difficult
to quantify. Staff does not have a specific recommendation to mitigate expected lost revenues at
this time but does want to bring this issue to the Council's attention and ask that this issue be
referred to the Finance Committee. A possible mitigation to consider is to seek additional and
more comprehensive Golf Course design and planning beyond mitigating for the golf holes
impacted by levee realignment. For a point of reference, during the major capital improvements
at the Golf Course in 1998-99 the City experienced a 25% reduction in annual play; such a
reduction today would translate to $500,000 annually in lost revenues. Staff is working with the
JP A to explore appropriate mitigations as the timeline and levee design work progresses and look
forward to discussing options with the Finance Committee.
2. Golf Course Infrastructure Reserve
Regarding the revision of the Cost Plan allocation for the Golf Course to a more traditional golf
course operation allocation will occur with the reduction of 7 Full Time Equivalent (FTE) to .45
FTE staff previously dedicated to the in-house Golf Course maintenance operation, as city Cost
Plan is allocated based on FTE. The result of the Cost Plan revision, coupled with the lower
overall cost of private Golf Course maintenance, will be a positive cash flow for the Golf Course,
if annual rounds played hold steady at 68,000 or more. It is recommended that revenues above
and beyond the cost of operating the Golf Course be considered for a infrastructure reserve for
ongoing capital improvement needs for the Golf Course. This recommendation aims to reduce
the need for debt when the 1998 bond debt of $570,000 annually expires in 2018. The Golf
Course Advisory Committee believes creating an infrastructure reserve, paid for by the golfing
community, as a very important step for the long-term financial health of the Golf Course. Staff
recommends that this item also be referred to the Finance Committee for further discussion
Other related items for that staff would like Council to be aware of are:
3. Aligning Golf Course Contracts -Food and Beverage, Professional Services, Golf Course
Maintenance and Pro Shop
The recommendation to align the two tenant leases and management contract at the Golf Course,
so they will expire concurrently, remains a staff recommendation. Specifically alignment of
contracts would allow consideration of other, potentially more effective and efficient, operating
options and a smoother transition of operation, should that be deemed advantageous in the future.
The ValleyCrest maintenance contract is strategically aligned with the existing lease agreement
with Brad Lozares for operating the Pro-Shop. Moreover, staff intends to bring an extension of
the existing management agreement with Lozares to the Council before the end of 2010 to align
the management agreement with the Pro-Shop Lease and the proposed ValleyCrest maintenance
agreement expiration date. This would result in 3 of the 4 Golf Course contracts to expire at the
same time, April 2013. The lease' with R&T Restaurant Corporation, who operates the Bay Cafe,
has a term that expires in 2018; options for re-aligning this lease with the other three Golf Course
contracts is also being considered.
4. Capital Improvement
Lastly regarding the recommendation to commit to a plan of cost neutral capital improvements,
to ensure the Golf Course remains competitive, the only CIP improvements recommended at this
CMR 382:10 70f8
Attachment C
time are those related to the improvements derived at through cooperation with the JP A to design
an environmentally friendly flood control project that will balance flood control with long-term
financial viability and improvements to the Golf Course.
RESOURCE IMPACT
The cost of the proposed ValleyCrest contract for Golf Course maintenance is $1,850,000 for a
term of 30-months and a contingency of $185,000. The CSD budget has sufficient funds to
address the contract and 10% contingency. In addition staff has negotiated a fair and reasonable
price »,ith ValleyCrest for all major City-owned Golf Course maintenance equipment on-site for
$125,000. The total cost savings to the City for entering into the ValleyCrest contract, as
compared to the cost of the City to provide Golf Course maintenance, is expected to be
approximately $500,000 over the term of the proposed contract. .
ENVIRONMENTAL REVIEW
No environmental review is needed at this time. However, should a Golf Course capital
improvement project be considered at a future date all appropriate environmental review and
consideration will take place prior to approval.
ATTACHMENTS
Attachment A
Attachment B
Attachment C
Attachment D
Economics Research Associates Golf Course Operational Study -
Executive Summary
General Services Agreement between the City and ValleyCrest
List of used City Golf Course maintenance equipment
CMR: 446:08 Operational Analysis of the City Palo Alto Municipal Golf
Course
PREPAREDBY: ____________ ~ __ ~ __ _=~=_ __ ~~ ____________ ___
ROBDEGEUS
Division Manager, Recreation Services
DEPARTMENT HEAD APPROVAL: --~--=::.=?4L-"-~~~--~"----------------~S '
Director, Community Services
Department
CITY MANAGER APPROV AL: --_fL-I-----~f__-_I_,I__-----
CMR 382:10 80f8
Attachment C
Attachment A
Economics Research Associates
Palo Alto Muni Operational Analysis Executive Summary
The City of Palo Alto provides golf services through its municipal golf course -Palo
Alto Muni. Presently, the golf course operation and foodoand beverage functions are
the responsibility of private sector providers, while the City maintains the golf course.
• The Bay Area golf market, like nearly every major metropolitan market in the country,
has experienced very soft market conditions over the past six to seven years. The Bay
Area public golf market has been more severely affected and recovered more slowly
than most markets.
• Play at Palo Alto Muni has declined from about 90,000 rounds in 2000 to 76,240
rounds in 2007, a decline of 16 percent over the 2000-2007 period. By comparison,
the average play per public access course in the Bay Area has declined about 12
percent since 2000, with play at the more relevant competitive set of public access
courses down about 17 percent.
• Conditions at most Bay Area public courses have stabilized and there has been
modest improvement in play levels over the past two years. Over the next five-to
ten-year period, the regional golf market is expected to continue to gradually improve
as the "baby boom" population ages in-place and limited expansion of the inventory of
public golf courses occurs.
• Annual play at competitive Bay Area courses ranges from 57,000 to 87,000 rounds,
averaging 70,700 rounds. Palo Alto Muni, at 76,000 rounds, ranks third among the 15
competitive courses surveyed.
• Greens fees at Palo Alto Muni of $36 weekdays and $47 weekends, excluding cart,
are near the top of the range among competitive Bay Area courses, and are deemed
at, or approaching, market levels.
• Palo Alto Muni revenue performance generally is favorable:
The average greens fee is $30.40 which compares with an average of $28.89 for
competitive courses over a range of $19.31 to $37.92 per round.
Cart revenue per round is $4.08, lowest among competitive courses due to very
low cart utilization which stems primarily from the limited course topography and
short distance between greens and tees.
10990 Wilshire Boulevard Suite 1500 los Angeles, CA 90024
310.477.9585 FAX 310.478.1950 www.econres.com
Los Angeles San Francisco San Diego Chicago Washington DC New York London
Attachment C
Range revenue averages $13,600 per tee per year for the 26-tee facility, ranking
the facility among the top of the competitive set of courses.
Merch~ndise sales at Brad Lozares Golf Shop are at a very high level, ranking Palo
Alto Muni as one of the top golf retail operations at municipal courses in the
country.
Given the limited capacity of the clubhouse to accommodate special events, food
and beverage revenue is consistent with the performance at competitive facilities.
• Approximately 20 percent of Palo Alto Muni golfers reside within the City, with the
majority of others residing in other South Bay communities.
• A survey of golfers at Palo Alto Muni revealed a high satisfaction level in terms of the
tee time reservation system, tee time reliability, marshalling, and pace of play. Nearly
90 percent of golfers deemed weekday and 73 percent weekend greens fees
acceptable.
• A very high percentage of golfers rate golf operations (instruction, customer service,
merchandise) "excellent" or "good," while only about one-half rated food and
beverage facilities/services at this level.
• The majority of golfers rated golf course conditions as "fair" or "poor."
• Of those respondents who stated that Palo Alto was not their primary course, primary
reasons were:
Course quality/play experience: 41.1 %
Location: 23.4%
Fees: 12.5%
Tee time availability: 6.8%
Clearly, course quality and play experience, and not fee levels or tee time availability,
are the primary reasons why most people choose another facility over Palo Alto Muni
as their primary course.
• About 40 percent of the golf course master plan improvements were completed in the
1998-1999 course renovation. In light of the cost of completing the master plan
improvements, and the threat of major disruption/impacts related to the San Francisco
Economics Research Associates Project No. 17383 Page 2
Attachment C
Creek Flood Control project, it is prudent to consider limited targeted improvements to
the course.
• The highest priority capital improvements needed for the golf course to remain
competitive in the marketplace are summarized below:
Component
Golf Course
Driving Range
Maintenance Yard
Clubhouse
Soft Costs/Contingency
Total
Amount
($000)
$ 870
600
100
~
$1,884
• The $870,000 allowance for the golf course improvements addresses primarily
problems with original greens and bunkers which require rebuilding. Completion of
the full master plan improvements would likely cost $4 to $5 million, or more, and is
not considered to be cost-effective at this time. At least in the near-to mid-term, it
would appear to be more appropriate to intensify golf course maintenance -including
resumption of the fairway sanding program -than investing in extraordinary golf
course improvements.
• Maintenance staffing levels at Palo Alto Muni compared with Bay Area competitive
facilities is summarized as follows:
Palo Alto Muni
Comparative Courses
Range
Average
Course Maintenance Employees
Full Part Time Total
Time (FTE) (FTE)
9
10-15
12
0-3
2
10
12-17
14
• Excluding irrigation, annual maintenance costs at Palo Alto Muni are compared with
benchmark facilities, as follows:
Economics Research Associates Project No. 17383 Page 3
Attachment C
Palo Alto Muni
Public Provider
Range (5 courses)
Average
Private Provider
Range (10 courses)
Average
Annual
Maintenance
Expenses
($000)
$1,195
$1,033-1,336
$1,171
$ 474-1,105
$ 778
• As with most public agencies, the City of Palo Alto assesses a charge to the golf
course for Citywide overhead services such as human resources, legal, accounting,
budget, management, purchasing, insurance (the City is self-insured), and similar
functions. Referenced as the Cost Plan, currently the assessment totals about
$380,000 per year.
• Clearly, there is a value of the overhead services provided by the City. While it is
difficult to precisely determine the value of these overhead services, an estimate
based on assessing the cost of these services if provided by a typical owner/operator
can be offered:
Overhead Service
On-Site Accounting
Audit
Insurance (liability, general)
Contract Management
Other Services*
Total
Annual
Amount
$ 50,000
25,000
40,000
35,000
75000
$225,000
*Represents portion of typical professional management
fee related to providing human resources, budget, cash
management, accounting and reporting systems, and
other required overhead services.
• Net income accruing to the City from golf operations for FY 2007 is shown after
deducting an allowance for the Cost Plan:
Economics Research Associates Project No. 17383 Page4
Attachment C
City Net Operating Income
Less: Debt Service
Cost Plan
Adjusted Net Income
FY 2007 Net Income ($000)
As Reported Adjusted
$992 $992
( 558) ( 558)
( 380) ( 225)
$ 54 $209
• Under the current operating structure, and assuming completion of the limited capital
improvement program, the golf course is expected to generate $950,000 per year in
net operating income at a stabilized play level, prior to debt service ($559,000 existing
plus $145,000 related to financing proposed capital improvements) and the City's Cost
Plan (overhead) allocation. This compares with about $900,000 reported for 2007
(after deducting an allowance for capital improvement replacement reserves).
Thousands of 2008 Constant Dollars
Projected at Stabilized Play
Actual Cost Adjusted
2007 Plan Cost Plan
Revenue $2,851 $3,148 $3,148
Less: Operating Expenses' 1 859 2098 2098
Net Operating Income $ 992 $1,050 $1,050
Less: Existing Debt Service $ 558 $ 558 $ 558
New Debt Service 145 145
Cost Plan 380 380 225
Replacement Reserve ~ ---1Ql -1Q1
Subtotal $1.033 .$.LJJH $1,029
Net Cash Flow ($ 41 ) ($ 134) $ 21
While net cash flow is projected to decline slightly following the completion of capital
improvements, a more precipitous decline would be expected in the absence of such
a program as the course becomes less competitive.
• The current golf operations agreement is a hybrid structure which is slightly favorable
to the concessionaire. Hypothetically, the golf operations function could be converted
to a more traditional facility lease (concession agreement) or fee-for-service
management agreement. If the City continues to maintain the golf course, nominal
improvement in net cash flow would result from a change in the operating structure.
• The differential between City and private providers maintenance function of the golf
course is estimated at $250,000 to $300,000 per year. Thus, any form of
Economics Research Associates Project No. 17383 Page 5
Attachment C
management, with private maintenance, would likely increase City net income by this
amount of cost savings.
• The City funded the $7 million 1998-1999 capital improvements with a tax-exempt
bond issue. To maintain the tax-exempt status of the bonds, the IRS requires
compliance with several provisions including the form and structure of management.
These provisions, in large part, have influenced the current structure. Altering the
operating structure to a traditional concessionaire agreement or leasing the facility
likely would require modification of the current debt structure.
Economics Research Associates Project No. 17383 Page 6
Attachment C
Attachment B
CITY OF PALO ALTO CONTRACT NO. Cll136681
GENERAL SERVICES AGREEMENT
THIS AGREEMENT made and entered into on the 1st day of NOVEMBER, 2010, by and between the CITY OF
PALO ALTO, a California Chartered Municipal Corporation ("CITY"), and V ALLEY CREST GOLF
COURSE MAINTENANCE, INC. , a California Corporation, located at 24151 Ventura Blvd, Calabasas, Ca
91302, Telephone Number: 818-737-3110 ("CONTRACTOR"). In consideration of their mutual covenants, the
parties hereto agree as follows:
1. SERVICES. CONTRACTOR shall provide or furnish the services ("Services") described in the Scope of
Services, attached as Exhibit A.
2. EXHIBITS. The following exhibits are attached to and made a part of this Agreement:
1:8:1 "A" -Scope of Services
1:8:1 "B" -Schedule of Performance
1:8:1 "c" -Compensation
1:8:1 "D" -Insurance Requirements
1:8:1 "E" -Performance and/or Payment Bond
1:8:1 "F" -Liquidated Damages
CONTRACT IS NOT COMPLETE UNLESS ALL EXHIBITS ARE ATTACHED.
3. TERM.
The term of this Agreement is from November 1,2010 to April 30, 2013 inclusive, subject to the provisions
of subsection 3.(b) and Section Q and V of the General Terms and Conditions.
4. SCHEDULE OF PERFORMANCE. CONTRACTOR shall complete the Services within the term of this
Agreement in a reasonably prompt and timely manner based upon the circumstances and direction
communicated to CONTRACTOR, and if applicable, in accordance with the schedule set forth in the
Schedule of Performance, attached as Exhibit B. Time is of the essence in this Agreement.
5. COMPENSATION FOR ORIGINAL TERM. CITY ~hall pay and CONTRACTOR agrees to accept as
not to exceed compensation for the full performance of the Services and reimbursable expenses, if any:
The total maximum lump sum compensation of dollars ($ );OR
The sum of
amount of
dollars ($
dollars ($
) per hour, not to exceed a total maximum compensation
);OR
o A sum calculated in accordance with the fee schedule set forth in Exhibit C, not to exceed a total
maximum compensation amount of One Million Eight Hundred and Fifty Thousand Dollars
($1,850,000.00), paya.ble over the3Q:;monthtel'l1i,{)fthis'Agreemerit;"'tor:iSefYltesi'peffolrried; as
follows:
CONTRACTOR agrees that it can perform the Services for an amount not to exceed the total maximum
compensation set forth above. Any hours worked or services performed by CONTRACTOR for which
payment would result in a total exceeding the maximum amount of compensation set forth above for
performance of the Services shall be at no cost to CITY.
Tritheeventthilicurrent Golf COul'secoJifiguratiori~; are . changed or : re..:desigrted;a$.(j.,festilt'ofClTY,
Rev. January 11,2010
C:\Documents and Settings\esolhei\Local Settings\Temporary Internet Files\OLK34\CII 136681 Contract Draft Document (2).doc
Attachment C
B, The City has set aside the sum of ()ri¢~fhind£et'tEighiYFiVe:Th~ousfujah)61i~s($i8510Dd.nn) for
Additional Services. CONTRACTOR shall provide Additional Services only by advanced,
written authorization from the City Manager or designee. CONTRACTOR, at the CITY's request,
shall submit a detailed written proposal including a description of the scope of services, schedule,
level of effort, and CONTRACTOR's proposed maximum compensation, including reimburs<tble
expense, for such services. Compensation shall be based on the hourly rates set forth above or in
Exhibit C (whichever is applicable), or if such rates are not applicable, a negotiated lump sum.
CITY shall not authorize and CONTRACTOR shall not perform any Additional Services for
which payment would exceed the amount set forth above for Additional Services. Payment for
Additional Services is subject to all requirements and restrictions in this Agreement.
6. COMPENSATION DURING ADDITIONAL TERMS.
o CONTRACTOR'S compensation rates for each additional term shall be the same as the original
term; OR
B CONTRACTOR's compensation rates shall be adjusted effective on the commencement of each
Additional Term. The lump sum compensation amount, hourly rates, or fees, whichever is
applicable as set forth in section 5 above, shall be adjusted by a percentage equal to the change in
the Consumer Price Index for Urban Wage Earners and Clerical Workers for the San Francisco
Oakland-San Jose area, published by the United States Department of Labor Statistics (CPI)
which is published most immediately preceding the commencement of the applicable Additional
Term, which shall be compared with the CPI published most immediately preceding the
commencement date of the then expiring term. Notwithstanding the foregoing, in no event shall
CONTRACTOR's compensation rates be increased by an amount exceeding five percent of the
rates effective during the immediately preceding term. Any adjustment to CONTRACTOR's
compensation rates shall be reflected in a written amendment to this Agreement.
7. INVOICING. Send all invoices to the CITY, Attention: Project Manager. The Project Manager is: Joseph
Vallaire, Golf Course Superintendent, Community Services Dept., Parks and Golf Division, Telephone:
650-329-2175. Invoices shall be submitted in arrears for Services performed. Invoices shall not be
submitted more frequently than monthly. Invoices shall provide a detailed statement of Services performed
during the invoice period and are subject to verification by CITY. CITY shall pay the undisputed amount
of invoices within 30 days of receipt.
GENERAL TERMS AND CONDITIONS
A. ACCEPTANCE. CONTRACTOR accepts and agrees to all terms and conditions of this Agreement. This
Agreement includes and is limited to the terms and conditions set forth in sections 1 through 6 above, these
general terms and conditions and the attached exhibits.
B. QUALIFICATIONS. CONTRACTOR represents and warrants that it has the expertise and qualifications
to complete the services described in Section 1 of this Agreement, entitled "SERVICES," and that every
individual charged with the performance of the services under this Agreement has sufficient skill and
experience and is duly licensed or certified, to the extent such licensing or certification is required by law,
to perform the Services. CITY expressly relies on CONTRACTOR's representations regarding its skills,
knowledge, and certifications. CONTRACTOR shall perform all work in accordance with generally
accepted business practices and performance standards of the industry, including all federal, state, and local
operation and safety regulations.
C. INDEPENDENT CONTRACTOR. It is understood and agreed that in the performance of this
Agreement, CONTRACTOR and any person employed by CONTRACTOR shall at all times be considered
2 Rev. January JI, 2010
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Attachment C
an independent CONTRACTOR and not an agent or employee of CITY. CONTRACTOR shall be
responsible for employing or engaging all persons necessary to complete the work required under this
Agreement.
D. SUBCONTRACTORS. CONTRACTOR may not use subcontractors to perform any Services under this
Agreement unless CONTRACTOR obtains prior written consent of CITY. CONTRACTOR shall be solely
responsible for directing the work of approved subcontractors and for any compensation due to
subcontractors.
E. T AXES AND CHARGES. CONTRACTOR shall be responsible for payment of all taxes, fees,
contributions or charges applicable to the conduct of CONTRACTOR's business.
F. COMPLIANCE WITH LAWS. CONTRACTOR shall in the performance of the Services comply with
all applicable federal, state and local laws, ordinances, regulations, and orders.
G. DAMAGE TO PUBLIC OR PRIVATE PROPERTY. CONTRACTOR shall, at its sole expense, repair
in kind, or as the City Manager or designee shall direct, any damage to public or private property that
occurs in connection with CONTRACTOR's performance of the Services, including the storage facility
located on site, made available to Cdntractor by CITY for use during Tertnof Agreemeht at no Cost.
CONTRACTOR shall maintain the building to a minimum of the same condition as when CONTRACTOR
took occupancy. CITY may decline to approve and may withhold payment in whole or in part to such
extent as may be necessary to protect CITY from loss because of defective work not remedied or other
damage to the CITY occurring in connection with CONTRACTOR's performance of the Services. CITY
shall submit written documentation in support of such withholding upon CONTRACTOR's request. When
the grounds described above are removed, payment shall be made for amounts withheld because of them.
H. WARRANTIES. CONTRACTOR expressly warrants that all services provided under this Agreement shall
be performed in a professional and workmanlike manner in accordance with generally accepted business
practices and performance standards of the industry and the requirements of this Agreement.
CONTRACTOR expressly warrants that all materials, goods and equipment provided by CONTRACTOR
under this Agreement shall be fit for the particular purpose intended, shall be free from defects, and shall
conform to the requirements of this Agreement. CONTRACTOR agrees to promptly replace or correct any
material or service not in compliance with these warranties, including incomplete, inaccurate, or defective
material or service, at no further cost to CITY. The warranties set forth in this section shall be in effect for
a period of one year from completion of the Services and shall survive the completion of the Services or
termination of this Agreement.
I. MONITORING OF SERVICES. CITY may monitor the Services performed under this Agreement to
determine whether CONTRACTOR's work is completed in a satisfactory manner and complies with the
provisions of this Agreement.
J. CITY'S PROPERTY. Any reports, information, data or other material (including copyright interests)
developed, collected, assembled, prepared, or caused to be prepared under this Agreement will become the
property of CITY without restriction or limitation upon their use and will not be made available to any
individual or organization by CONTRACTOR or its subcontractors, if any, without the prior written
approval of the City Manager.
K. AUDITS. CONTRACTOR agrees to permit CITY and its authorized representatives to audit, at any
reasonable time during the term of this Agreement and for three (3) years from the date of final payment,
CONTRACTOR's records pertaining to matters covered by this Agreement. CONTRACTOR agrees to
maintain accurate books and records in accordance with generally accepted accounting principles for at
least three (3) following the terms of this Agreement.
L. NO IMPLIED WAIVER. No payment, partial payment, acceptance, or partial acceptance by CITY shall
operate as a waiver on the part of CITY of any of its rights under this Agreement.
M. INSURANCE. CONTRACTOR, at its sole cost, shall purchase and maintain in full force during the term
of this Agreement, the insurance coverage described in Exhibit D. Insurance must be provided by
companies with a Best's Key rating of A-:VII or higher and which are otherwise acceptable to the City'S
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Risk Manager. The City's Risk Manager must approve deductibles and self-insured retentions. In addition,
all policies, endorsements, certificates and/or binders are subject to approval by the Risk Manager as to
form and content. CONTRACTOR shall obtain a policy endorsement naming the City of Palo Alto as an
additional insured under any general liability or automobile policy. CONTRACTOR shall obtain an
endorsement stating that the insurance is primary coverage and will not be canceled or materially reduced
in coverage or limits until after providing 30 days prior written notice of the cancellation or modification to
the City's Risk Manager. CONTRACTOR shall provide certificates of such policies or other evidence of
coverage satisfactory to CITY's Risk Manager, together with the required endorsements and evidence of
payment of premiums, to CITY concurrently with the execution of this Agreement and shall throughout the
term of this Agreement provide current certificates evidencing the required insurance coverages and
endorsements to the CITY's Risk Manager. CONTRACTOR shall include all subcontractors as insured
under its policies or shall obtain and provide to CITY separate certificates and endorsements for each
subcontractor that meet all the requirements of this section. The procuring of such required policies of
insurance shall not operate to limit CONTRACTOR's liability or obligation to indemnify CITY under this
Agreement.
N. HOLD HARMLESS. To the fullest extent permitted by law and without limitation by the provisions of
section M relating to insurance, CONTRACTOR shall indemnify, defend and hold harmless CITY, its
Council members, officers, employees and agents from and against any and all demands, claims, injuries,
losses, or liabilities of any nature, including death or injury to any person, property damage or any other
loss and including without limitation all damages, penalties, fines and judgments, associated investigation
and administrative expenses and defense costs, including, but not limited to reasonable attorney's fees,
courts costs and costs of alternative dispute resolution), arising out of, or resulting in any way from or in
connection with the performance of this Agreement. The CONTRACTOR's obligations under this Section
apply regardless of whether or not a liability is caused or contributed to by any negligent (passive or active)
act or omission of CITY, except that the CONTRACTOR shall not be obligated to indemnify for liability
arising from the sole negligence or willful misconduct of the CITY. The acceptance of the Services by
CITY shall not operate as a waiver of the right of indemnification. The provisions of this Section survive
the completion of the Services or termination of this Contract.
O. NON-DISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONTRACTOR
certifies that in the performance of this Agreement, it shall not discriminate in the employment of any
person because of the race, skin color, gender, age, religion, disability, national origin, ancestry, sexual
orientation, housing status, marital status, familial status, weight or height of such person. CONTRACTOR
acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto
Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and
agrees to meet all requirements of Section 2.30.510 pertaining to nondiscrimination in employment.
P. WORKERS' COMPENSATION. CONTRACTOR, by executing this Agreement, certifies that it is aware
of the provisions of the Labor Code of the State of California which require every employer to be insured
against liability for workers' compensation or to undertake self-insurance in accordance with the provisions
of that Code, and certifies that it will comply with such provisions, as applicable, before commencing and
during the performance of the Services.
Q. TERMINATION. The City Manager may terminate this Agreement without cause by giving ten (10)
days' prior written notice thereof to CONTRACTOR. If CONTRACTOR fails to perform any of its
material obligations under this Agreement, in addition to all other remedies provided by law, the City
Manager may terminate this Agreement immediately upon written notice of termination. Upon receipt of
such notice of termination, CONTRACTOR shall immediately discontinue performance. CITY, CITY
shall pay CONTRACTOR for services satisfactorily performed up to the effective date of termination. If
the termination if for cause, CITY may deduct from such payment the amount of actual damage, if any,
sustained by CITY due to Contractor's failure to perform its material obligations under this Agreement.
Upon termination, CONTRACTOR shall immediately deliver to the City Manager any and all copies of
studies, sketches, drawings, computations, and other material or products, whether or not completed,
prepared by CONTRACTOR or given to CONTRACTOR, in connection with this Agreement. Such
materials shall become the property of CITY.
R. ASSIGNMENTS/CHANGES. This Agreement binds the parties and their successors and assigns to all
covenants of this Agreement. This Agreement shall not be assigned or transferred without the prior written
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consent of the CITY. No amendments, changes or variations of any kind are authorized without the written
consent of the CITY.
S. CONFLICT OF INTEREST. In accepting this Agreement, CONTRACTOR covenants that it presently
has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would
conflict in any manner or degree with the performance of this Contract. CONTRACTOR further covenants
that, in the performance of this Contract, it will not employ any person having such an interest.
CONTRACTOR certifies that no City Officer, employee, or authorized representative has any financial
interest in the business of CONTRACTOR and that no person associated with contractor has any interest,
direct or indirect, which could conflict with the faithful performance of this Contract. CONTRACTOR
agrees to advise CITY if any conflict arises.
T. GOVERNING LAW. This contract shall be governed and interpreted by the laws of the State of
California.
U. ENTIRE AGREEMENT. This Agreement, including all exhibits, represents the entire agreement
between the parties with respect to the services that may be the subject of this Agreement. Any variance in
the exhibits does not affect the validity of the Agreement and the Agreement itself controls over any
conflicting provisions in the exhibits. This Agreement supersedes all prior agreements, representations,
statements, negotiations and undertakings whether oral or written.
V. NON-APPROPRIA TION. This Agreement is subject to the fiscal provisions of the Charter of the City of
Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the
end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any
time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and
funds for this Contract are no longer available. This Section shall take precedence in the event of a conflict
with any other covenant, term, condition, or provision of this Contract.
W. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS.
CONTRACTOR shall comply with the City's Environmentally Preferred Purchasing policies which are
available at the City'S Purchasing Department which are incorporated by reference and may be amended
from time to time. CONTRACTOR shall comply with waste reduction, reuse, recycling and disposal
requirements of the City'S Zero Waste Program. Zero Waste best practices include first minimizing and
reducing waste; second, reusing waste and third, recycling or composting waste. In particular, Contractor
shall comply with the following zero waste requirements:
• All printed materials provided by Contractor to City generated from a personal computer and
printer including but not limited to, proposals, quotes, invoices, reports, and public education
materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer
content paper, unless otherwise approved by the City's Project Manager. Any submitted materials
printed by a professional printing company shall be a minimum of 30% or greater post-consumer
material and printed with vegetable based inks.
• Goods purchased by Contractor on behalf of the City shall be purchased in accordance with the
City'S Environmental Purchasing Policy including but not limited to Extended Producer
Responsibility requirements for products and packaging. A copy of this policy is on file at the
Purchasing Office.
• Reusable/returnable pallets shall be taken back by the Contractor, at no additional cost to the City,
for reuse or recycling. Contractor shall provide documentation from the facility accepting the
pallets to verify that pallets are not being disposed.
X. AUTHORITY. The individual(s) executing this Agreement represent and warrant that they have the legal
capacity and authority to do so on behalf of their respective legal entities.
Y. CONTRACT TERMS: All unchecked boxes do not apply to this Contract.
IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Agreement
on the date first above written.
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CITY OF PALO ALTO
City Manager or Designee
(Required on contracts $85,000 and over)
Approved as to form:
Senior Assistant City Attorney
V ALLEY CREST GOLF COURSE
MAINTENANCE, INC.
By ____________________________ ___
Name --------------------------------
Title ----------------------------------
Telephone: ______ ..,..-__ ---, ______________ _
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EXHIBIT A
SCOPE OF SERVICES
SPECIFICATIONS & REQUIREMENTS
Contract No. C11136681
GOLF COURSE MAINTENANCE PROJECT
Specifications for the services of Golf Course Maintenance of
The City of Palo Alto Municipal Golf Course:
I. SCOPE OF WORK-Golf Course Maintenance
CONTRACTOR shall provide the highest quality of Golf Course maintenance
services and materials, The Contractor agrees to provide the highest quality
commercially accepted methods, procedures and scientific controls for Golf
Course maintenance. "Scientific Controls" is understood to mean practices
based upon recommendations of the University of California, The U.S. Forest
Service, or similarly qualified experts; recommendations in University of
California Cooperative Extension Publications, Consumer Products Safety
Commission Playground Guidelines and information in standard landscape
industry references; This shall include the use of proper knowledge, skills,
materials' and equipment of a timely basis to maintain all areas in a clean, safe,
healthy, and aesthetically acceptable manner during the entire term of this
contract.
The Contractor agrees to be continuously alert in locating and defining problems
and agrees to exercise prompt and proper corrective action. Action times will be
prioritized, and low priority items will be given a time line for corrections. A
PRELIMINARY WRITTEN REPORT SHALL BE SUBMITTED FOR MAJOR
CORRECTIVE PROBLEMS NOT COVERED IN THE CONTRACT. The
Contractor shall communicate to the City ALL hazards that are seen while on
site.
II. GOLF COURSE MAINTENANCE SPECIFICATIONS
1.0 GENERAL REQUIREMENTS
The following Special Conditions and Specifications apply to the Palo Alto Golf
Course, City of Palo Alto, CA.
The Contractor shall furnish all labor, equipment, materials, tools, services and
special skills required to perform the landscape and other maintenance as set
forth in these specifications and in keeping with the highest standards of quality
and performance.
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NOTE: Any and all references to the role or duties of the Golf Services Manager
(GSM) do not relieve the Contractor of any obligation to maintain the golf courses
in conformance to the specifications outlined.
1.1 SAFETY
1.1.1 The Contractor agrees to perform all work outlined in these specifications
in such a manner as to meet all accepted standards for safe practices
during the maintenance and operation and to safely maintain equipment,
machines, and materials or other hazards consequential or related to the
work; and agrees additionally to accept the sole responsibility for
complying with all local, County, State or other legal requirements,
including but not limited to full compliance with the terms of the applicable
OSHA and CAL OSHA Safety Orders, and at all times protecting all
persons, including operator's employees, vendors, members of the public
or others from foreseeable injury or damage to their property. The
Contractor shall identify and inspect all potential hazards at said areas
under maintenance and keep a log indicating date inspected and action
taken.
1.1.2 The Contractor shall ensure all required certifications and training
methods are adhered to and current.
1.1.3 For the safety of the public and contracted employees, the Contractor
shall adhere to all handling and use requirements for pesticides,
chemicals and fungicides used within the scope of these services. The
use of hazardous pesticides or chemicals will require proper certification of
applicators. Notices will be prominently posted in public areas for the use
of hazardous chemicals or pesticides.
1.1.4 When performing work, the Contractor shall make every effort to keep
sidewalks, vehicle travel lanes and driveways open at all times, and honor
golf etiquette by performing maintenance tasks within acceptable golf play
conditions.
1.1.5 It shall be the Contractor's responsibility to inspect and identify any
condition(s) that renders any portion of the areas under maintenance
unsafe, as well as any unsafe practices occurring thereon. The GSM shall
be notified immediately of any unsafe condition that requires correction.
The Contractor shall be responsible for making corrections, including but
not limited to filling holes and replacing valve box covers so as to protect
golfers and other members of the public from injury. The Contractor shall
cooperate fully with the City in the investigation of any accidental injury or
death by the public, the Contractor, or its employees, agents and
representatives, or any other entity occurring in the contracted areas,
including a complete written report thereof to the GSM within twenty-four
(24) hours following the occurrence.
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1.2 PROTECTION OF PROPERTY
1.2.1 During Periods of Inclement Weather:
The Contractor will provide supervisory inspection of the golf course
during regular hours to prevent or minimize possible damage. The
Contractor shall submit a report identifying any storm damage to the GSM
attached to a site map identifying location of damage. The Contractor's
workforce shall continue to accomplish work not affected by such weather
(i.e. clean-up and facility maintenance, as well as work caused by the
inclement weather).
1.2.2 The Contractor shall exercise due care during the performance of work in
protecting from damage all existing facilities, structures and utilities both
above surface and underground the City's property. Any damage to City
property deemed to be caused by the Contractor's neglect shall be
corrected and paid for by the Contractor at no cost to the City.
1.2.3 If the City requests or directs the Contractor to perform work in a given
area, it will be the Contractor's responsibility to verify and locate any
underground utility systems and for taking reasonable precaution when
working in these areas. Any damage or problems shall be reported
immediately to the GSM.
1.3 INTEGRATED PEST MANAGEMENT.
The City of Palo Alto is a charter signatory to the Bay Friendly Landscape
Declaration and has an award-winning Integrated Pest Management (IPM)
Program (2003 Department of Pesticide Regulation IPM Innovator). The IPM has
been successful in large part to efforts of both the Parks and Golf Divisions to
reduce pesticide use (see 2009 Annual Pest Management Report Attachment 1).
Proposals will be evaluated in part by the Contractor's ability to collaborate with
City staff to proactively and effectively reduce the amount and toxicity of
pesticides in favor of non-chemical controls and least-toxic products when
chemical control must be used.
The goal of the City of Palo Alto's IPM Program is to reduce the amount and
toxicity of pesticides used on City property in order to protect water quality and
human health and to avoid ecotoxicity; ecotoxicity is defined as toxicity to birds,
fish, bees, and aquatic indicator species, and potential secondary or non-target
poisoning from consumption of rodent baits based on product Material Safety
Data Sheets (MSDS) and other resources. Preferred pest management
techniques include encouraging naturally occurring biological control, using
alternative plant species or varieties that resists pests; cultivating, pruning,
fertilizing, and irrigation practices that reduce pest problems and optimizing
habitat to reduce pest development, selecting pesticides with the least toxicity to
humans and non-target organisms and applying pesticides only as a last resort.
Toxicity levels are based on criteria used in the City's Pesticide Tier Review
Methodology Attachment 2);
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The followl!la IPM provisions must be met:
.The Contractor must work closely with the GSM and the City's IPM
Coordinator (IPMC) to achieve annuallPM goals which strive to
reduce the amount and toxicity of pesticides that are used while
maintainin the health and aesthetics of the
b. Within 30 days of the contract award and annually on the
anniversary of this Agreement, the Contractor shall submit to the
GSM and the City's IPMC, an Integrated Management Plan that
complies with the City of Palo Alto's IPM Policy. The plan shall be
reviewed annually for updates and modifications. Frequent and
thorough site inspections on foot will be needed to ensure no major
fungal or insect infestations occur.
c. Fungicides, insecticides and herbicides will be approved prior to
use by the GSM with the IPMC consultation. New pesticides may
not be used without prior authorization. Pesticides will be selected
in accordance with the City's goal to minimize the use of ecotoxic,
"Tier 1 JJ pesticides and the total amount of pesticides (active
ingredient) as defined in the City's annual pest report.
d. The Contractor must maintain any pre-existing IPM strategies used
at the golf course unless otherwise determined by the GSA in
consultation with the IPMC.
e. Reduction of Tier 1 fungicides has been a key component of the
Golf Course reducing its pesticide toxicity. When use of fungicides
is necessary, Tier 2 fungicide use must be maximized prior to the
use of Tier 1 fungicides. If Tier 1 fungicides must be used, then Tier
. 1 fungicides that are not ecotoxic (a subset of Tier 1 pesticides)
must be used first. See Attachment 3 for a list of current fungicides
that are used including the preferred Tier 2 products. The City's
Environmental Compliance Program will provide technical
assistance in determining product toxicity and Tier rankings.
f. The City reserves the right to disallow any pest control measure
that it determines may jeopardize the health and safety of people or
the environment or which conflicts with the intention of the City's
IPM policy.
g. Rodent control will be performed by trapping. Baiting or fumigant
use is prohibited unless authorized by the GSM in consultation with
the IPMC. Trapping will be performed using devices that are .
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preapproved by GSM using humane trapping procedures in order
to minimize stress or animal discomfort.
h.. For insect or other invertebrate control,
the first priority will be
to address conditions that are conducive to insect pests and
conserve naturally beneficial insects (or other invertebrates).
Selective applications of the least-toxic pesticides may be used
only when non-chemical control measures have been exhausted.
The following products may not be used for insect control:
i.' Products labeled with the signal word "danger"
ii. Organophosphate products (e.g.,diazinon or chlopyrifos)
iii. Carbamate products (e.g., carbaryl)
iv. Pyrethroid-containing products
Biological controls will be based upon sound information such as
that provided by the University of California. City staffwiH provide
site-specific historical data for known infestations.
i. The Contractor must provide regular pesticide reporting information
in electronic format using the City's Contractor's Pesticide
Application Form (Attachment 4) to be emailed to the GSM and the
City's IPM Coordinator by the 15th of each month for the previous •
month's work unless otherwise agreed upon and approved by the
IPM Coordinator. The Contractor must also have internet access
and the ability to enter pesticide use information online if the City
provides that reporting mechanism.
j. For the City's Annual Pest Management and IPM Report, the
Contractor must also provide information confirming appropriate
training of staff, an annual inventory of hazardous materials and
hazardous wastes to ensure expired or prohibited products are
appropriately disposed and a written summary of the challenges
and successes of IPM program efforts annually. The brief report
format, i~provided.brrsity, ___ &1_ ---
k. Per the City's shared Municipal Regional Storm water permit, IPM
training must be provided to staff at a minimum of once every three
years.
I. Requests for information from the GSM or IPM Coordinator must
"be responded to within 48 hours.
All materials used shall be in strict accordance with and applied within the
standards set forth in the EPA regulations and the California Food and
Agricultural Code.
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The Contractor is responsible for obtaining all required permits and maintaining
the required usage documentation and to comply with all requests from the Santa
Clara County Agricultural Department to inspect records, licenses, training
certificates, equipment and storage facilities. All applicable regulations shall be
strictly adhered to, and all required reporting shall be the responsibility of the
Contractor.
1.3.1 Pesticide Application Timing: Pesticides shall be applied at times that
limit the possibility of contamination from weather, irrigation or other
factors. Early morning or evening application shall be used when possible
to avoid contamination from drift. If applicable, drift control skirted booms
must be used when golfers are present if applicable. Small backpack
applications may be performed based on weather protection and with
provisions made for the safety of golfers. Applicator shall monitor forecast
weather conditions to avoid making application prior to inclement weather
to eliminate potential runoff of treated areas. Irrigation water applied after
treatment shall be reduced to eliminate runoff. When water is required to
increase pesticide efficiency, it shall be applied only in quantities per the
label requirements and of which each area is capable of receiving without
excessive runoff.
1.3.2 Handling of P~sticides: Care shall be taken in transferring and mixing
pesticides to prevent contaminating areas outside the target area.
Application methods shall be used which ensure that materials are
confined to the target area. Spray tanks containing leftover materials shall
not be drained on the site to prevent contamination. Disposal of
pesticides and tank rinsing materials shall be within the guidelines
established in the California Department of Food and Agricultural Code or
EPA regulations.
1.3.3 Equipment and Methods: Spray equipment shall be in good operating
condition, quality, and design to efficiently apply material to the target
area. Avoiding high pressure applications and using water soluble drift
agents will minimize drift.
1.3.4 Recommendations: All pesticide applications shall be in accordance with
written recommendations provided by a licensed Pest Control Advisor
(PCA) with copies of the written recommendations sent to the GSM. A
licensed Qualified Applicator (Qualified Applicator Certificate) shall be kept
on site during application.
1.3.5 Selection of Materials: Pesticides shall be selected from those approved
for golf course use by California Department of Food and Agriculture and
in compliance with Section 1.3 listing prohibited pesticides.
1.4 SOUND CONTROL REQUIREMENTS
1.4.1 The Contractor shall comply with all local sound control and noise level
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rules, regulations and ordinances, which apply to any work performed
pursuant to the contract.
1.4.2 Each internal combustion engine used for any purpose on the job or
related to the job shall be equipped with a muffler of a type recommended
by the manufacturer of such equipment. No internal combustion engine
shall be operated on the project without said muffler.
1.5 EQUIPMENT AND ACCESSORIES
The Contractor to provide all necessary equipment needed to meet the
expectations set forth in this scope of services.
The Contractor shall take all necessary precautions for safe operation of
equipment and the protection of the public from injury and damage from
such equipment.
All accessory equipment must be maintained in a clean, safe, functioning
condition at all times and repainted as required to present an aesthetically
pleasing appearance. Accessory equipment shall include but is not limited
to the following:
NOTE: Must be same or equal to current types and any changes require
prior approval of the GSM.
Repair and replacement of signage, shoe brushes, trash receptacles, ash urns,
greens cups, NCGA tee markers, benches, sand rakes, flags and poles, ball
washers, fairway yardage poles, and sprinkler yardage markers are the
responsibility of the Contractor.
1.6 INQUIRIES AND COMPLAINTS
1.6.1 The Contractor shall have designated responsible management personnel
to take the necessary action regarding all inquiries and complaints that
may be received from or through the City and/or private citizens during
normal work hours. Copies of any and all public correspondence will be
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provided to. the City's centract manager.
1.6.2 Whenever immediate actien is required to. prevent impending injury, death
er property damage to. the facilities being maintained, the City may after
reasenable attempt to. netify the Centracter, cause such acticn to. be taken
by the City werk force and shall charge the full cest thereef to. the the
Centracter.
1.6.3 All cemplaints shall be abated as scen as pessible after netificatien to. the
satisfactien ef the City. If any cemplaintis net abated within a reasenable
time, the City shall be netified immediately ef the reascn fer net abating
the cemplaint, fellewed by a written repert to. the GSM within three (3)
days.
1.6.4 Menthly gclfer surveys will be cenducted, gelfer satisfactien efgelf ceurse
cenditiens indicating geed cr excellent is expected frem 80% er mere ef
respenses.
1.7 MAINTENANCE EMPLOYEES/UNIFORMSNEHICLES
1.7.1 Empleyees: A designated full-time Class "A" Gelf Superintendent and
Mechanic must be assigned full time at the gelf ceurse. Also. an English
speaking superviscr, who. is fully trained in all maintenance
respensibilities, must be en-site at all times while werk is being perfermed
at the Pale Alto. Gclf Ceurse. The Centractor shall provide to. the City,
upen cemmencement ef agreement, all Jeb Classificatiens and Jeb
Descriptiens for duties, respensibilities and services to. be perfermed at
gclf ceurse as described in the agreement.
The Centracter may use temperary empleyees in case ef absences or
emergencies if these emplcyees are trained in gelf ceurse maintenance,
etiquette, and are in uniform so. that we maintain set standards.
All maintenance empleyees shall present a neat, well-greemed
appearance at all times.
Empleyees shall act in a ceurteeus, professienal manner at all times.
Every effert shall be made to. perferm the werk while creating minimum
disturbance to. the gelfers. Any empleyee who. is determined by the G8M
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to be incompetent, disorderly, intemperate or otherwise behaving
objectionably, shall be immediately removed from the crew and replaced
with a satisfactory replacement.
1.7.2 Uniforms: The Contractor shall pay for and bear the maintenance cost of
uniforms for all employees working on the golf course.
The uniform shall be worn as a complete unit and befitted properly. The
uniform shall be cleaned and pressed with no rips, tears or permanent
stains present. The uniform shall include an insignia or logo that refers to
"City of Palo Alto Municipal Golf Course."
In cool weather when a jacket or sweatshirt is needed, the jacket or
sweatshirt shall be worn as the outer garment. All shirts and jackets shall
have the golf course logo and the worker's first name on them.
Protective golf staff equipment shall be determined by the Contractor
when working on the golf course. When working elsewhere at the facility,
but not within the actual field of play, a cotton uniform cap with either of
the golf course logos may be worn, but must be worn with the bill facing
forward at all times.
1.7.3 Vehicles: All vehicles used on the course shall be maintained in good
mechanical and body repair. The vehicles shall be clean both inside and
out at all times. The vehicles driven on public road ways shall bear the
Contractor's company name, which is visible on both sides of the vehicles.
The vehicles used on the course will also display an adopted insignia or
logo that refers to "City of Palo Alto Municipal Golf Course."
Each vehicle shall be equipped to hold all tools and equipment in a neat
and orderly fashion.
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1.8 THE CITY'S RIGHT TO DO WORK I
The City reserves the right to do work as required within the contract area.
The work referenced herein may include but is not limited to capital
improvements and/or alterations intended to improve golf course facilities
and infrastructure. If such projects materially affect the cost to meet the
requirements of the agreement, the Contractor will be asked to submit
justification to support the additional costs. The Contractor and the City
will review the justification in order to consider modifications to the
Financial Conditions of the agreement.
2.0 / SPECIFIC MAINTENANCE REQUIREMENTS
2.0.1 The Contractor shall notify the City prior to use of a sub Contractor on the
golf course. All sub Contractors shall have appropriate insurance and
safety requirements and shall be trained in golf course etiquette
procedures prior to any work being performed.
2.0.3 All golf course related pJans are property of the City and use is restricted
to premises. The Contractor shall make copies as required to ensure the
original s~t of plans remains in good condition.
2.0.4 The Contractor shall perform any required maintenance activities, such as
but not limited to ropes, stakes, traffic control, turf aerification, and
overseeding as a result of golf cart use on the course.
2.0.5 The Contractor shall meet weekly with the golf professional to coordinate
golf events and maintenance activities.
2.1 MAINTENANCE RECORDS
The Contractor shall provide the GSM with a written schedule of the work
to be performed during the following month which includes but is not
limited to: general golf course maintenance, aerification, tree trimming,
pond maintenance, herbicide/insecticide application, fertilization and
replacement of color plants. The report shall be provided in a format
developed by The Contractor and City and approved by the GSM. If the
Contractor finds that it is not possible to maintain the submitted schedule,
the GSM shall be advised and a revised schedule submitted.
2.1.1 The Contractor shall maintain and keep current a log that records all on
going, seasonal and additional work, and maintenance functions
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performed on a daily basis by the Contractor's personnel. Said report shall
be in a form and content acceptable to the GSM and shall be submitted to
the City concurrent with the monthly invoicing. The monthly payment will
not be made until such report is received by the City.
2.2 TREES
2.2.1 Trees trimmed as needed. All tree trimming shall be performed on a
schedule approved by the GSM and in accordance with the tree, shrub
and other wood plan maintenance pruning practices outlined by the
American National Standards Institute, Inc. (ANSI) and International
Society of Arboriculture (ISA) BMP standards. However, such trimming
and pruning is a minimum level and shall not relieve the Contractor of
other responsibilities set forth herein. The Contractor shall consult with the
City's Managing Arborist on issues concerning the removal or treatment of
trees at the Golf Course.
2.2.2 Trees shall be kept in healthy condition and pruned as required to remove
broken or diseased branches. The Contractor shall develop a pruning
program, which will promote proper tree scaffolding, strength, and
appearance consistent with its intended use. The Contractor shall prune
trees to allow wind to pass thro,ugh the tree, reducing and preventing a
"sail" effect when needed.
2.2.3 Trees located adjacent to vehicular and/or pedestrian traffic ways shall be
maintained so as not to obstruct vehicle and/or pedestrian visibility and
clearance. Trees interfering with airport tower vision must be trimmed and
lowered as needed.
2.2.4 Fertilization shall be scheduled as often as required to keep trees in a
healthy and desirable condition per soil analysis and identification of
nutrient deficiencies as outlined in the pruning specifications. Avoid
applying fertilizer to root ball or base of main stem; instead spread evenly
in area of drip zone.
2.2.5 Tree stakes, ties, and guys shall be checked and corrected as needed.
Ties will be adjusted to prevent girdling. Remove unneeded stakes, ties,
and guys as required. Re-stake trees as required using lodge pole stakes.
2.2.6 Prune trees along sidewalks and cart paths to-allow a ten (10) foot
clearance for pedestrians and golf carts and fifteen (15) feet above curb
and gutters for vehicular traffic.
2.2.7 Ailing or stunted trees which fail to meet expected growth will receive
additional nutrient treatments to correct any deficiencies. Terminally
diseased trees are to be removed per the City's removal policy and
procedures.
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2.2.8 Surface roots, which become maintenance or appearance problems, will
be removed or additional soil and sod cover shall be placed as required to
prevent damage to adjacent areas, mowers and golf carts. No weed whip
marks or herbicides around exposed roots or trunks.
2.2.9 Any trees that are blown over shall either be removed and replaced or
topped and righted at the Contractor's expense.
2.2.10 The Contractor shall develop a Tree Management Plan within six (6)
months of commencement of the Agreement, approved by the GSM, for
maintenance of existing trees, removal of dead or diseased trees, and
replacement of aging trees. The Plan will be reviewed by the City's
Managing Arborist for comments and amendments before being accepted
by the City.
2.2.11 Any dead tree at no fault to" the Contractor shall be removed (with the
City's prior approval), including stump grinding and repair of such area at
the Contractor's expense.
2.2.12 Any dead tree at fault of the Contractor shall be removed (with the City's
prior approval) and replaced per the City Tree Ordinance at the
Contractor's expense.
2.2.13 The Contractor shall plant and care for up to 50 new trees each year of
the contract. Trees will be provided by the Contractor. Salt tolerant trees,
recycled water tolerant, wind breaks, maximum height requirements
(airport) will be considered when selecting trees.
2.3 SHRUBS
2.3.1 Prune shrubs to retain as much of the natural informal appearance as
possible.
2.3.2 Shrubs used as formal hedges or screens shall be pruned as required to
present a neat, uniform appearance.
2.3.3 Remove any spent blossoms or dead flower stocks as required to present
a neat, clean appearance.
2.3.4 Plants growing over curbing and/or sidewalks shall be trimmed on a
natural taper rather than vertical so as not to appear to be hedged.
2.3.5 Schedule the application of a commercial fertilizer as often as required to
promote optimum growth and healthy appearanceto all shrubs.
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2.3.6 Any plant requiring removal shall be replaced by the Contractor.
2.4 GROUND COVER -NATIVE GRASSES
2.4.1 Apply all chemical control (e.g. pesticides) as required and in
conformance with the Golf Course Integrated Pest Management Plan that
will be approved each year (page 6; section 1.3) to control or prevent pest
infestations to protect ornamental plantings.
2.4.2 Trim ground cover adjacent to walks, walls and/or fences as required for
general containment to present a neat, clean appearance.
2.4.3 Cultivate and/or spray herbicide to remove broad-leafed and grass weeds
as required (and in conformance with the Golf Course Integrated Pest
Management Plan that will be approved each year (page 6; section 1.3).
Shrub beds shall be maintained in a weed free condition.
2.4.4 Keep ground cover trimmed back from all controller units, valve boxes,
quick couplers, or other appurtenances or fixtures. Do not allow ground
covers to grow up trees, into curbs, or on structures or walls. Keep
trimmed back approximately 4 inches from structure or walls.
2.4.5 Fertilization: Schedule fertilization of all ground cover areas with a
commercial fertilizer as often as required to promote healthy appearance.
Any fertilizer or chemicals must be applied is strict adherence with
manufacturer's directions to avoid contamination of waterways or
disturbance of natural resources. Fertilizers that contain pesticides must
be reported to the IPMC on the Contractor's Pesticide Application Form.
2.4.6 Ground cover plants shall be added as needed to ensure a solid mass
planting in conformance with the original intent.
2.5 PEST CONTROL ON PLANTS
2.5.1 The Contractor shall provide complete and continuous control and/or
eradication of all plant pests or diseases in conformance with the Golf
Course Integrated Pest Management Plan (page 6; section 1.3).
2.5.2 The Contractor shall supply the proper chemical designated for the pests
to be controlled. Any pesticides or chemicals must be applied in strict
adherence with manufacturer's directions to avoid contamination of
waterways or disturbance of natural resources and be in conformance with
the Golf Course IPM Plan that will be approved each year.
2.5.3 The Contractor shall obtain all necessary regulatory permits and assume
responsibility for the use of all chemical controls.
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2.6 IRRIGATION SYSTEM:
The Contractor will assume all responsibilities for maintenance and repair
of all 2 inch and smaller pipe and all components of the irrigation system
such as sprinkler heads, valves, valve boxes, restraints, gaskets, swing
joints, quick couplers, saddles, electrical, controller satellites, and
hardware of the Palo Alto Golf Course irrigation system. All expenses for
parts and labor will be paid for by the Contractor. When replacing steel
nuts and bolts the Contractor will use only highest grade stainless steel.
All components will be replaced with same manufacture and models as
components being replaced unless otherwise approved by GSM.
2.6.1 EFFICIENT USE OF WATER:
2.6.1.1 Considerations must be given to soil texture, structure, porosity,
water holding capacity, drainage, compaction, precipitation rate, run off,
infiltration rate, percolation rate, evapotranspiration, seasonal
temperatures, prevailing wind condition, time of day or night, type of grass,
plant and root structure. This may include syringing during the day and
watering during periods of windy weather.
2.6.1.2 The Contractor shall be responsible for daily monitoring all systems
within premises and correcting for coverage, adjustment, clogging of lines
and sprinkler heads, removal of obstacles, including plant materials which
obstruct the spray.
2.6.1.3 The soil moisture content on greens, tees and fairways shall be
checked regularly and appropriate adjustments made. Adequate soil
moisture shall be determined by visual observation, plant resiliency, and
turgidity, examining cores removed by soil probe, moisture sensing
devices and programming irrigation controllers accordingly.
2.6.1.4 The Contractor shall observe and note deficiencies occurring from
the original design of facilities and review these findings with the GSM so
necessary improvements can be considered.
2.6.1.5 All leaking or defective valves, lines, sprinkler heads, and quick
couplers shall be repaired within twenty-four (24) hours at the expense of
the Contractor. A report of such repairs shall be given to the GSM weekly.
2.6.1.6 The Contractor shall turn off all controllers when it is not necessary
to irrigate due to adequate rainfall.
2.6.1.7 The Contractor shall monitor reclaimed water and potable water.
Reclaimed water shall not exceed 65% and potable water costs shall not
exceed $250,000. The Contractor shall notify GSM if these costs exceed
$225,000. As conditions dictate GSM may approve additional potable
water use.
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2.6.2 SYSTEM MAINTENANCE
The Contractor is aware of the current state of the golf course irrigation
system and accepts full responsibility for the repair and maintenance of
the system as is. Any required replacements, repairs, and maintenance to
existing components of the system to ensure the system remains in
operation are the sole responsibility of the Contractor. Appropriate
personnel shall be trained in the use of the master irrigation computer.
2.6.2.1 All controllers are to be kept pest-free, clean and visible. All parts and
repairs necessary to maintain the operation are the responsibility of the
Contractor.
2.6.2.2 The computer and software (including annual service agreements)
necessary to operate and maintain the irrigation control systemshall be
maintained by the Contractor. The Rainbird Support Agreement shall be
kept current at all times. Computer and Controller information will be
properly kept.
2.6.2.3 Any repairs made by the operator shall be made in accordance with the
industry standards and conforming to all related codes and regulations.
2.6.2.4 The Contractor shall be responsible for adjusting the height of sprinkler
risers necessary to compensate for growth of plant materials.
2.6.2.5 Automatic controllers and/or enclosures shall be locked while
unattended.
2.6.2.6 All controller enclosures must be painted or replaced as needed to
maintain a good appearance.
2.6.2.7 Sprinkler heads and valve boxes shall be kept clear of overgrowth which
may obstruct maximum operation. Missing or broken valve boxes will be
replaced by The Contractor.
2.6.2.8 Repairs and/or upgrades made to the irrigation system must be made in
accordance with the system's original design with products equal to or
higher quality than currently provided.
2.6.2.9 The GSM should be notified regarding any interruption of water service
to the golf course.
2.6.2.10 All irrigation repairs and maintenance including, but not limited to,
sprinkler heads, piping, fittings, valves, controller boxes, controller
supplies, and controller face plates must be performed utilizing the same
manufacturer and type of product as existing materials. Any change to
existing materials must have prior approval by the GSM.
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2.7 ANIMAL AND RODENT CONTROL
The Contractor shall continuously, at a minimum on a weekly basis,
control and eradicate rodents and other animal pests as necessary to
prevent hazards, holes and destruction of plantings on golf course
property in accordance with the Golf Course IPM Plan which will be
drafted annually and following specifications for rodent control. Damage to
public or private property due to erosion as a result of rodent activity shall
be repaired at the Contractor's expense.
2.8 WEED CONTROL OF PAVED SURFACES
The Contractor shall control all weeds growing in cracks, expansion joints
and other hard surfaces by the use of mechanical weed control or with
limited use of chemicals in accordance with the Golf Course IPM Plan.
2.9 WEED CONTROL IN LANDSCAPE AREAS
Weed control in landscaped areas shall be accomplished by mulching and
the use of mechanical weed eradication.
2.10 STRING TRIMMERS
Care shall be exercised with regard to the use of string trimmers to
prevent damage to building surfaces, walls, header board, light fixtures,
signage, etc. A minimum of 12" bare soil or mulched buffer zone shall be
maintained around the circumference at the base of all trees in
landscaped areas.
2.11 GREENS
Maintain all turf in accordance with playability and industry wide standards
as determined by the G8M, observing the following minimum
requirements:
2.11.1 Greens shall be mowed daily with an approved greens reel type mower at
a height of 130 or as recommended by the superintendent and approved
by the G8M. Frequencies and height of cut may be modified from time to
time as deemed necessary by the golf course superintendent with the
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prior approval of the GSM. All grass clippings must be collected and
removed from the site during each mowing operation, including dispersed
in a method to prevent unplayable conditions. Greens must be mowed,
and rolled if performed, prior to first golfer of day reaching each respective
green, including the putting green. Care will be given on clean-up lap
mowing to reduce turf loss and playability.
2.11.2 Ball cups are to be relocated daily to USGA Standards to enable worn
turf spots to recover. Putting green cups to be changed every other day.
Hole positions will be rotated using front, middle, and back locations for
each three hole sequence. Pin placement shall be in healthy turf area
according to rotation plan. Hole plugs set at proper grade.
2.11.3 Verticutting of greens shall be scheduled bi-weekly or more including
double verticutting during periods of active turf growth. Each verticutting
shall be at 90 degrees to the previous cut. Verticutting activities should
match the agronomic requirements of plant growth. This function shall
be coordinated to compliment the aerification and topdressing schedules.
Combing or brushing may also be done. Verticut depth should be
appropriate to playing conditions and agronomic needs. If play
conditions are such that greens are not smooth for ball roll (bumpy), the
Contractor shall utilize verticutting and other agronomic methods to
improve golf ball roll.
2.11.4 Aerify greens at least two (2) times per year in spring, either March or
April, and fall, either September or October, or more frequently if needed.
Plugs will be removed the same day. Aerification shall be carried out
with a minimum of interference to play. Aerification shall be scheduled at
least 6 months in advance with the GSM and golf professional. All
aerification hole sizes with a minimum of 5/8 inch hollow tine utilized, and
spoil locations shall be pre-approved by the GSM. Aerification holes shall
penetrate to a depth of three inches. Care should be taken to have as
minimal disturbance to green surface from manual and equipment
applications during aerification process. Aerification of greens for
agronomic purposes, other than annual regularly scheduled aerifications,
shall be reviewed and scheduled with the golf professional and GSM to
reduce golfer impact.
2.11.5 Following all annual regularly scheduled aerifications, a topdressing sand
material approved by the GSM shall be applied and brushed into the turf
with follow applications performed as needed. Application shall be done
with an approved topdressing spreader or blown in with walking blowers.
Spot topdressing may be applied to repair damage from ball marks or
any other damage. Light topdressing will be done every two weeks
during the active growth season to maintain turf playability and
agronomic conditions. Turf irrigation requirements shall be adjusted
during process to ensure proper agronomic conditions are met.
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2.11.6 The Contractor shall have the soil analyzed after the start of the term of
the contract and once every year thereafter on dates preapproved by the
GSM. Apply fertilizer and nutrients in the quantity and type
recommended by soil analysis and growing conditions at the time of
treatment and in a manner to provide uniform growth of turf. Under
normal conditions, 0.5 to 1.2 pounds of actual nitrogen per thousand
square feet shall be applied per growing month. Typically, a variety of
granular slow release types of material or liquid sprayable fertilizer may
be utilized. Use of materials to control salt damage and water infiltration
shall be applied to meet the requirements of the turf and playable
conditions. Fertilizer shall be applied every 3-4 weeks during the active
growing season and every five (5) weeks for the remainder of the year.
2.11.7 Treat greens with proper chemicals to control insects, disease, weeds
and other pests in conformance with the City's IPM Plan.
2.11.8 Greens shall be kept free of non-native and/or invasive grasses and/or
broad leaf weeds that tend to creep in from the edges. A threshold level of
0-2% has been set for weeds and disease: Insect threshold has been set
at 0-5%. No foreign grass encroachment from collars.
2.11.9 EC readings should be taken during spring and fall to determine salts
levels and if they are above normal, corrective action taken to reduce to
appropriate levels to promote optimum health of the turf.
2.11.10 Green speed should be consistent daily on all greens with the difference
between the lowest green speed and the highest green speed no more
than one (1) foot in variance on the stimp meter through out golf course.
Green speeds should be no lower than 8 feet in average daily during the
months of May, June, July, August, September, and October, and no
lower than 8 feet 6 inches daily for the other months. Green speeds
should be maintained as high as agronomic conditions and play
conditions allow.
2.11.11 Debris from trees shall be cleared prior to mowing and during day as
needed, no standing water or severe turf loss areas, pest and vandal
damage to be repaired, and bare and stressed areas sodded or plugged
to ensure quality playing conditions.
2.11.12 Ball marks shall be repaired daily.
2.12 COLLARS, APPROACH, BANKS AND GREEN SURROUNDS
Maintain all turf in accordance with playability and industry wide
standards as determined by the GSM observing the following minimum
requirements:
2.12.1 Collars shall be mowed a minimum of two (2) times each week to
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maintain a height of % inch, mowing with a triplex mower.
2.12.2 Green surrounds shall be mowed a minimum of (1) time each week to
maintain a height of 1" to 1-1/4" inch or a height as recommended by the
superintendent and approved by the GSM. If a rotary mower is used, it
shall be specifically designed to prevent scalping of the turf.
2.12.3 Fertilization frequency, types of material, and analysis shall be
determined from results of annual soil nutrient level testing and growing
conditions at the time of treatment. Under normal conditions, 0.50 to 0.75
pounds of actual nitrogen per thousand square feet shall be applied every
6-S weeks during the active growth season and every S-1 0 weeks for the
remainder of the year. Typically combinations of granular slow release
type of materials may be utilized.
2.12.4 Mowing directions should be changed to prevent turf depressions and turf
loss.
2.12.5 Approach shall be mowed a minimum of two (2) to three (3) times each
week to maintain a height of % inch or a height as recommended by the
superintendent and approved by the GSM, cut with a greens-type triplex
mower.
2.12.6 Grass clippings shall be removed and dispersed properly Jo avoid
affecting golf play.
2.12.7 Bunker banks shall be mowed to ensure no rutting occurs and proper turf
heights are maintained. If rutting occurs, areas shall be sodded for repair.
2.12.S Verticutting shall be performed at least two (2) times per year. All other
provisions of section 2.11.3 shall be followed.
2.12.9 Aerify at least two (2) times per year in spring and fall, or more frequently
if needed, and remove plugs the same day~ Aerification shall be carried
out with a minimum of interference to play. Aerification shall be scheduled
each year for the following year in conjunction with the GSM and golf
professional. All aerification hole sizes, with a minimum of 5/S inch hollow
tine utilized, and spoil locations shall be pre-approved by the GSM.
Aerification holes shall penetrate to a depth of three inches. Care should
be taken to have as minimal disturbance to the turf surface from manual
and equipment applications during aerification process. Aerification for
agronomic purposes other than annual regularly scheduled aerifications
shall be reviewed and scheduled with the golf professional to reduce
golfer impact.
2.12.10 Following all annual regularly scheduled aerifications, a topdressing sand
material approved by the GSM shall be applied as needed. Application
shalLbe done with an approved topdressing spreader. Turf irrigation
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requirements shall be adjusted during process to ensure proper
agronomic conditions are met.
2.13 TEE MAINTENANCE
Maintain all turf in accordance with playability and industry-wide standards
as determined by the GSM observing the following minimum
requirements:
2.13.1 Service tees daily by moving tee markers, removing trash and checking
benches and ball washers. Change tee towels and water weekly and
keep ball washers filled to proper level with water and appropriate
cleaning agent. Tee markers shall be moved daily to healthy turf areas,
placed at appropriate direction to play. Tee markers placed in healthy
areas with tee markers set flat to ground and direction of play.
2.13.2 Mow tees two (2) times weekly with reel type mower, with baskets, at
height of 1/2 inch or a height as recommended by the superintendent and
approved by the G8M. All grass clippings will be collected and dispersed
. properly for playable conditions.
2.13.3 Aerify and topdress tees, with sand and mulch pre-approved by the GSM,
at least two (2) times per year, or more frequently if needed, using the
appropriate equipment with the minimum of interference to play.
Aerification shall be carried out with a minimum of interference to play and
plugs removed the same day. Aerification shall be in conjunction with the
golf professional and the G8M. All aerification hole sizes, with a minimum
of 5/8 inch utilized, and spoil locations shall be pre-approved by the GSM.
Care should be taken to have as minimal disturbance to tee surface from
manual and equipment applications during aerification process. Bare
areas sodded and leveled.
2.13.4 Fertilization frequency, materials and analysis shall be determined from
results of annual soil nutrient level testing and growing conditions at the
time of treatment. Under normal conditions, 0.50 to 0.75 pounds of actual
nitrogen per thousand square feet shall be applied every 6-8 weeks during
the active growth season and every 8-10 weeks during the remainder of
the year. Typically combinations of granular slow release type of
materials may be utilized.
2.13.5 Repair worn and damaged turf areas as they occur by topdressing,
overseeding or resodding to ensure playability at all times. No standing
water or mud holes and pest and vandal damage repaired.
2.13.6 Tees shall be overseeded, with approved perennial rye seed by the GSM,
following aerification and before topdressing at a rate of 9 Ibs. per
thousand square feet of tee area.
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2.13.7 Treat tees for control of insects, disease, weeds and other pests as
necessary to maintain healthy turf. All treatments shall be in compliance
with the City's IPM Plan. A threshold level of 25% has been set for weeds
and disease. Insect threshold is 33%. Spot spraying by location basis
only when thresholds are exceeded.
2.13.8 Trash receptacles are to be emptied daily.
2.13.9 A sand and seed container, approved by the GSM, must be available on
all Par 3 holes, for use in repairing divots. A container must be set at each
respective set of tee markers for each hole. Tee divots shall be filled with
sand and seed at a minimum of once per week on all holes and twice per
week on Par 3 holes.
2.13.10 Sufficient scorecard and pencil supplies shall be kept in stock at the
scorecard station between the No.1 green and the No.2 tee.
2.13.11 Tee yardage plaques, stations and signs shall be maintained and edged
at all times.
2.13.12 Tee station items, such as markers, signs, trash cans, ball washers, etc.
shall be in good condition and repaired or replaced as needed. All tee
station equipment cleaned and painted and ball washers operational.
2.13.13 Recycle trash containers shall be utilized and all recyclable glass, paper,
plastic, aluminum and other recyclable material shall be collected and
turned into appropriate recycle centers.
2.14 FAIRWAY MAINTENANCE
Maintain all fairways in accordance with playability and industry wide
standards as determined by the GSM, observing the following minimum
requirements:
2.14.1 Mow fairway two (2) times weekly at height of 5/8 inch or at a height as
recommended by the superintendent and approved by GSM.
2.14.2 Aerify all fairways at least one (1) time a year. The equipment used to
aerify the fairways shall be Power Take-Off (PTa) or self engine powered
to enable a three (3) to five (5) inch coring depth (John Deere2000
Aercore Aerator or equivalent) utilizing hollow coring, with a minimum of
3/4 inch hollow tine, as recommended by the superintendent and
approved by the GSM and cores shall be removed from the fairways.
Aerification shall'be scheduled in conjunction with the golf professional
and the GSM. All aerification hole sizes and spoil locations shall be
preapproved by the GSM. Care should be taken to have as minimal
disturbance to turf surface from manual and equipment applications during
aerification process. Slicing of the fairways at various intervals is
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recommended to promote turf growth, improve water infiltration, and
improve salt damage.
2.14.3 Overseed all fairways once per year, in fall and at a preapproved date with
the GSM and golf professional, with perenial rye grass, pre-approved by
the GSM, at a minimum rate of 400 Ibs. per acre. All seed shall be slit
seeded into the soil to ensure adequate soil and seed contact. A post
seed application of fertilizer (15-15-15 or equivalent) shall be applied with
four (4) weeks of the overseed process at a rate of one (1) Ib per thousand
of nitrogen. Overseed and topdress (or re-sod) of worn or bare areas of
fairways as necessary.
2.14.4 Treat turf to control weeds, invasive grasses (i.e. Kikuyu), diseases,
insects, and other pests as necessary to maintain fairway threshold level.
A threshold level of 35% for weeds, 50% for disease and 40% for insects
has been set. Spot spraying by location basis as needed when thresholds
are exceeded. All treatments shall be in compliance with the IPM Plan.
2.14.5 A proper fertilizing and nutrient program shall be performed per soil testing
recommendations each calendar year. Fertilization shall be performed a
minimum of every 8-10 weeks during the active growth season and every
10-12 week during the remainder of the year.
2.14.6 Policing to control litter shall be done on a regular basis for the removal of
all paper, leaves, cans, bottles, tree branches, etc.
2.14.7 Excessive turf clippings shall be dispersed by a method of dragging,
baskets, vacuumed or blown to ensure proper playable conditions are
provided. Grounds under repair painted with appropriate white turf paint
and roped off neatly and consistently throughout the golf course. Grounds
under repair include those under repair by the The Contractor and those
areas where turf is at a level that is not consistent with other associated
turf areas. Yardage markers and sprinkler head yardage markers in place
and maintained. Cart traffic management devices in place; bare or
stressed areas properly addressed. No standing water or mud holes.
Pest and vandal damage repaired.
2.14.8 Excessive turf clippings shall be dispersed by a method of dragging,
baskets, vacuumed or blown to ensure proper playable conditions are
provided. Grounds under repair painted with appropriate white turf paint
and roped off neatly and consistently throughout the golf course. Grounds
under repair include those under repair by the The Contractor and those
areas where turf is at a level that is not consistent with other associated
turf areas. Yardage markers and sprinkler head yardage markers in place
and maintained. Cart traffic management devices in place; bare or
stressed areas properly addressed. No standing water or mud holes.
Pest and vandal damage repaired.
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2.15 ROUGHS MAINTENANCE
Maintain all turf in accordance with playability and industry wide standards
as determined by the G8M, observing the following minimum standards:
2.15.1 Mow one (1) time per week at a height of 1-1/2 inches or a height as
recommended by the superintendent and approved by the G8M.
2.15.2 Rodent control and repair as needed. All rodent control shall be in
compliance with the IPM Plan. Pest and vandal damage repaired.
2.15.3 Overseed and topdress (or resod) worn or bare turf areas as necessary.
2.15.4 Fertilization frequency, materials and analysis shall be determined from
results of biannual soil nutrient level testing and growing conditions at the
time of treatment. Fertilization shall be performed a minimum of every 8-
10 weeks during the active growth season and every 10-12 week during
the remainder of the year.
2.15.5 Treat turf to control weeds, disease, insects and other pests as necessary
to maintain rough threshold. All treatments shall be in compliance with the
IPM Plan. A threshold level of 100% for insects and disease. Weed
threshold has been set at 50%. 8pot treatment by location basis only
when thresholds are exceeded.
2.15.6 Grounds under repair painted with appropriate white turf paint and roped
off neatly and consistently throughout the golf course. Grounds under
repair include those under repair by the The Contractor and those areas
where turf is at a level that is not consistent with other associated turf
areas. No standing water or mud holes, hazards properly marked, and
free of debris that affects play.
2.16 OTHER TURF AND MAINTENANCE AREAS
These areas consist of areas not detailed above.
2.16.1 All debris such as litter and branches shall be removed from the course
daily.
2.16.2 All yardage, course markers, ropes and stakes, and signage shall be
straight and damage free, and repaired and replaced as needed.
2.16.3 Any item that is a safety hazard shall be repaired or replaced immediately,
2.16.4 The Contractor shall submit annually to the G8M a written report for the
preceding 12 months detailing annual fertilizer, pesticide, fungicide and
other related applications for the golf course. The report will conform to
the requirements of the IPM Plan (Appendix A).
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2.16.5 The Contractor shall flush drainage inlets once a year.
2.16.6 The Contractor shall utilize wood chipping machinery to produce wood
chips from tree pruning and care. Wood chips may be spread throughout
golf course in preapproved areas by the GSM. No permanent dumping of
course debris such as branches, wood stumps, etc. is approved on the
property. The Contractor is responsible for costs associated with any
removal of debris. Any other course-generated debris such as earthen
spoils shall be dispersed at locations and with methods preapproved by
the GSM.
2.16.7 Turf areas surrounding the clubhouse shall be mowed one (1) time per
week at a height of 1-1/4 inches.
2.16.8 The Contractor shall provide, at The Contractor's sole expense and
liability, an effective goose control program to eliminate goose activities,
including use of control dog, motorized hand controlled boats, noise
makers, and other methods.
2.17 SAND BUNKERS
2.17.1 Sand bunkers shall be cleaned and raked by mechanical method or by
hand a minimum of three (3) times per week with Fridays being one of the
three days. No excess sand buildup on high side.
2.17.2 Sand depth shall be randomly checked monthly for depth of sand and
shall be maintained no less than four inches (4") deep. Additional sand
will be added at the The Contractor's expense.
2.17.3 Turf shall be mechanically edged along sand bunker edges monthly, or
more frequently if required, to ensure a neat appearance. Care shall be
taken to maintain the design outline of the bunkers to insure the integrity
of the bunker shape. Bunkers should have 1" lip on lower side. Chemical
control of sand edges through use of a non-selective herbicide or growth
.regulator around sand bunkers shall be allowed with preapproval of GSM.
2.17.4 Excess sand in the turf surrounding the trap shall be removed on a regular
basis.
2.17.5 A minimum of two (2) to five (5) rakes are to be available, depending on
bunker size, at all sand bunkers at all times. Rakes properly maintained.
(Color and style are subjectto GSM approval.)
2.17.6 Bunker sand shall be cultivated as needed, or at a minimum of once per
month, to ensure sand is not compacted. Methods should be used to not
disturb existing soil below the sand.
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2.17.7 All debris such as pine needles and cones, branches and other debris
shall be removed as needed to ensure playable conditions and reduce
sand contamination. No animal boroughs.
2.17.8 Excessive water ponding and silt accumulated by rain falls and irrigation
applications shall be removed prior to bunker raking.
2.18 CLUBHOUSE AREAS
2.18.1 SHRUB BEDS
2.18.1.1 Clean-up shall occur on a regular basis to ensure that beds are kept
free of trash and debris such as paper, cans and bottles, fallen
branches, excessive leaves and weeds. Mulch in proper areas, beds
to be weed free, properly trimmed, and watered properly; not overly dry
or wet.
2.18.1.2 A fertilizer program shall be a minimum of three (3) applications per
year or as needed for health and color.
2.18.1.3 Spent flowers, leaves, dead or diseased plants, and other landscape
debris shall be removed from plant areas daily, or as required.
Flowers changed by schedule or as needed.
2.18.2 SEASONAL COLOR BEDS
2.18.2.1 Annual flowers in place and healthy and missing plants replaced in
kind and number. All color beds shall be regularly cleared of paper,
bottles and cans, fallen branches, excessive leaves and weeds.
2.18.2.2 Weed control shall be accomplished by hand weeding, mulching, by
the use of mechanical equipment or by the selective use of herbicides.
A prescribed pest control spray program may be done as often as
necessary for pest control in accordance with the IPM Plan.
2.18.2.3 Beds shall be cultivated by mechanical means on a regular basis or as
required, or as directed by the GSM.
2.18.2.4 Color plants shall be replaced a minimum of twice annually and shall
be performed on a schedule submitted to and approved by the GSM.
The replacement plants shall be 4-inch potted size spaced per industry
standards and planted with the appropriate soil amendments.
2.18.3 PERIPHERY AREAS (Including the Planted Traffic Island on
Embarcadero Way)
2.18.3.1 All periphery areas shall be maintained in a manner consistent to
industry standards to ensure a healthy and aesthetically pleasing
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appearance at all times.
2.18.3.2 Areas shall be mowed, weeded, cleared of litter and other debris on a
regular basis (a minimum of once per week). Watering should occur if
the area is covered by the irrigation system.
2.18.3.3 Special attention shall be given to periphery areas adjacent to public
roadways since these areas are highly visible to the general public and
constitute a "first impression" of the overall service level of the course.
2.18,.3.4 All areas are to be inspected for erosion problems and repaired as needed.
2.19 PARKING LOTS
2.19.1 Parking lots shall be maintained in a safe condition for use by both
vehicles and pedestrians, and cleaned each day to ensure a clean, crisp
appearance free from litter, debris, and weeds including all landscaped
planters on or adjacent to the lots (including the traffic island on
Embarcadero Way near the primary entrance to the Golf Course).
2.19.2 All parking lot lighting shall be inspected daily and repaired as needed or
reported to the City's PW Facilities Maintenance Division.
2.19.3 "Disabled Parking" signage and other signage shall be maintained in
accordance with all City, County, and State regulations.
2.19.4 All parking lot signage shall remain in place, maintained and readable.
2.19~5 Parking lot asphalt shall be inspected daily by The Contractor. The City's
PW Facility Maintenance Division shall be called for repairs. Free of
debris, litter, leaves, and trimmings. The Contractor shall inspect and
clean daily.
2.20 GRAFFITI
2.20.1 Golf course shall be inspected dailyfor evidence of graffiti. Special
attention shall be given to restrooms, signs, markers, block walls, curbing,
paving, tees, utility poles/boxes and/or any other structures or fixtures.
2.20.2 All graffiti shall be removed within twenty-four (24) hours of detection.
2.20.3 Graffiti requiring paint over shall be painted over with a color consistent
with that of the original surface.
2.20.4 Graffiti on non-painted surfaces shall be removed by sand or water
blasting and area returned to the preexisting condition.
2.21 CART PATH/STEPS/RAMPSIWALKWAYSI BREEZEWAY
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2.21.1 Cart paths to be swept or blown clear of debris every Friday or more often
as needed. No standing water.
2.21.2 Concrete paths to be edged and scraped c1ean,a minimum of one (1) time
per month or as needed. Cart paths weed free. See IPM Plan.
2.21.3 The Contractor shall identify all potholes and/or other surface damage or
defects on concrete cart paths and report to the City for repair. If damage
is the fault of the Contractor the repair cost will be the responsibility of the
Contractor. Base Rock utility roads on holes #9, #12, and #13 will be
graded smooth weekly. Additional base rock added as needed at the
expense of the Contractor.
2.22 RESTROOMS AT HOLE #5
2.22.1 Inspected daily by the Contractor, clean and stocked daily by the City's
PW Facility Maintenance Division.
2.22.2 Inspected daily by the Contractor, sinks, toilets, walls, screens, and floors
shall be sanitized daily by the City's PW Facility Maintenance Division.
2.22.3 Paper supplies shall be checked and restocked daily or as needed.
2.22.4 Inspected daily by the Contractor for odor and operation. PW will be
contacted for corrections and repairs.
2.22.5 Leaking or malfunctioning fixtures shall be reported to the City's PW
Facility Maintenance Division immediately upon detection.
2.22.6 Lighting fixtures are to be checked daily with repairs of faulty fixtures
provided as needed at time of detection. The City's PW Facility
Maintenance Division will be contacted for repairs.
2.22.7Restroom floors which are wet for any reason, including mopping, shall be
so indicated with proper temporary signage.
2.22.8 No graffiti. The Contractor will inspect daily and contact the City's PW
Facility Maintenance Division for graffiti removal.
2.22.9 No worn spots in concrete, wood walls, or corrugated fiberglass barriers.
The City's PW Facility Maintenance Division will be contacted for repairs.
2.23 MAINTENANCE FACILITIES
2.23.1 The City shall make available for use by the Contractor, at no charge to
the Contractor, a maintenance facility at the golf course for the storage of
golf course-related equipment, materials and/or supplies. The facility will
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be available to the Contractor on an "as is" basis. The Contractor will
conform its use of the maintenance facility to all applicable laws, rules and
regulations regarding the storage of materials on the City's premises,
including, but not limited to, the storage of hazardous, toxic or
flammable materials. The City assumes no responsibility for any theft,
destruction or damage to the Contractor's personal property that is stored
in this facility. The Contractor will return the facility to the City in its
original condition as of the date of commencement of the contract
between the City and the Contractor, normal wear and tear excepted.
2.23.1..1 Permitted Usag~: The Contractor may usethePremises forthe
following uses: Storage, Files, Office area or other similar uses,
premises may not be used for any other purposes without City's
prior written consent, which consent may be withheld in the sale
and absolute discretion of the City.
2.23.1.2 RrohibitedOses. The Contractor shall notu$e Premisesfor
anypurpo$~not expresslypermitted hereunder.. The Contractor
shall nqt create, cause, maintainorpermitanynuisanceor
\fI/aste.,in,qn,·· oraboutth.eRremises, .•. orpermi.tor allow.the
Premises to be u$edforany LIn lavvru I or immoral purpose. The
CQntractorshallnot dopr permit to be done anything in . any
mannerwhichunreasonably.disturbs·the usersofthe·City
Pr8perty or the occup~ntspf neighboringpr8perty. Specifically,
a9dwithoutlirnitin~.theabove,.TheContrastor~greesnotJo
cause(lnyunreason(lplE1\odo(,inois~,vibration,·poWE1[emission,
orotheritem toeman(lteJromthe Premises. No·· materials or
artiql~$qf(l nyn~tu rerh(lllbE1storedoutside .. uppn·~nyportionof
the.Premises .. The ·Cpntractorwillnotuse Property in a·· manner
th~tincreas~rthe risk9f fir~icost of fireinsural"1.ce or
improvel11.ents.Jhe~eqp'···N9.~nreason~blesignorpl~~ardshall
bepaiptecJ.jiinscribed·brplace~ .. inqr9I1isaid.Prope~yr~9d nO
tree orshrub thereon shallbedestroyedorTemov~cJ9rother
wastecommittedofsaidPr9perty,. No bicycles, .motorcycI 7s,
automobiles.orother mechanical means of transportation shall
be placed or stored anywhere on the Property. exceptforthe
g(lrageqr driv~\Vay. N9rep~ir, overhaulorm8~ifi.cmion of any
motor"e~iclE1/shal.lt~kE1pl~ceonthE1prppe~yorthe~tr77t·in
front of said Property; TheContractor,athis/herexp~nse, shall
~eept.h~Propertyin~sgood·con~itio~.asit.~cl!5atth~
9~gi9nin~.8f·th7termsh7re9f,exc7pt.pa(ll.C3g78sc~~i()nedby
ordinarywear(lnd.tear,anqexcE1ptdal11(lgefQtgE3>rgpf,
side\V~I.k~.andunderground plumbing,which is nottli~faultof
theContractoL
2.23.1.3 Conditi0I1,UseofPremises. CitYimakesno~?~r~l1tyor
rE1pre~entationof.an¥kind. c08g~rn.ingtresondition()tthe
Premises, orthefitnessof the Premises for the use intended by
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2.23.2 The maintenance facilities shall be kept clean and neat at all times with
all material inventories and supplies stored in a manner in keeping with
CAL-OSHA regulations, the City's Fire Department regulations, and all
City, County and State regulations. Fire extinguishers must be
operational and inspected by the Fire Department.
2.23.3 Maintenance buildings and surrounds inspected daily. Report needed
repairs to GSM within 24hrs.
2.23.4 The maintenance area shall be locked or otherwise secured when
unattended to discourage unauthorized entry.
2.23.5 Office and lunchroom floors are to be vacuumed or swept five times per
week and mopped at least once a month at The Contractor's expense.
2.23.6 Rain gutters shall be kept clear of debris and cleaned a minimum of once
per year prior to fall rainfall period at The Contractor's expense.
2.23.7 Any security system shall be maintained and utilized at The Contractor's
expense.
2.23.8 The maintenance facilities shall be maintained by performing required
daily, monthly and annual maintenance of garage doors, inside and
outside doors, inside and outside windows, air conditioning or heater unit,
lighting, shelving, etc. All repairs to such facility are the responsibility of
the Contractor. The City is responsible for repair to the roof or outside
structure. The Contractor shall obtain and be responsible for quarterly
service to air conditioner and heating unit, and any subsequent repair or
service costs, and shall supply copy of written agreement to the GSM.
2.23.9 All facility and associated golf course maintenance utility costs are the
responsibility of the The Contractor, including telephone, gas, electric,
potable water, sewer, and trash.
2.23.10 Adherence to all City, County, and State regulations for proper storage
and disposal of materials is required.
2.24 CLUBHOUSE AND FACILITY LIGHTING
All lighting systems shall be inspected by the The Contractor on a regular
basis for faulty bulbs, fixtures or other malfunctions repaired and/or
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replaced as needed by the City's PW Facility Maintenance Division.
2.24.1 Walkways, breezeway, surroundings, ramps, driving range walkway and
tees cleaned of litter, dirt, and landscape debris daily. All garbage
containers at clubhouse and surrounding area must be emptied daily.
2.24.2 Exterior lighting working and scheduled properly. Report needed repairs
to the City's PW Facility Maintenance Division.
2.24.3 All signage accurate and readable.
2.24.4 A threshold of 50% has been set for disease and weeds 60% for insects.
Spot spraying by location basis only when thresholds are exceeded. Any
use of pesticides must conform to the IPM policies and procedures.
2.25 NETS/FENCES/GATES
2.25.1 The Contractor will be responsible for net repair and material costs on
holes 3,6,10, and Driving Range.
2.25.2 All fences and gates shall be inspected regularly with repairs made as
needed to ensure a safe, secure and aesthetically pleasing condition at all
times, no holes in fences. Repairs and materials are the responsibility of
the Contractor.
2.26 POND MAINTENANCE
2.26.1 Algae and cattail control program shall be maintained as approved by the
GSM.
2.26.2 Pond shall be inspected daily with all visible litter/trash removed upon
detection.
2.26.3 Pond water levels shall be maintained to ensure bank stability and
aesthetic.
2.26.4 Properly marked as water hazard.
2.26.5 A threshold of 25% on Aquatic weeds.
2.27 CONSTRUCTION AND/OR REMODELING OF GOLF COURSE
Any and all changes in the physical characteristics of any portion of the
course or structures such as addition or removal of sand traps, trees,
water hazards, native vegetation or other features shall require prior
approval by the GSM.
The Contractor will be paid for time and materials for any golf course
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renovation or construction work not listed in this scope of work. Quotes will
be submitted to the GSM for approval with itemized list of individual job
classifications, their time and hourly rate expense. (Complete Table 3,
Attachment C-1). Material will also be added along with any other
expenses to complete the Project.
Time and Material rates to be included within bid proposal. (Include on
Attachment C-1; Table 3, Schedule of Rates)
2.28 PRACTICE AREA I DRIVING RANGE MAINTENANCE
2.28.1 Turf shall be mowed weekly or as required at agreed-upon height by the
GSM.
2.28.2 General turf maintenance shall conform to procedures outlined in
Sections 2.11/Greens (page 17), 2.13/Tee Maintenance (page 19), and
2.15/Roughs Maintenance (page 20.
2.28.3 All Artificial Turf will be inspected weekly and repaired at the designated
Range closure time which is 5:00am -8:30 am every Thursday or at a time
which is approved by the Pro Shop Manager.
2.28.4 Light topdressing will be done once annually followed by brushing to
maintain integrity of Artificial Turf. Supplemental brushing required every 6
months.
2.28.5 Practice Bunker will have at least 4 inches of sand and kept trimmed and
edged. Bunker edges that are raised due to excessive sand build up will
be lowered by the Contractor when they reach one and a half feet over
original grade. Practice Bunker will be raked daily.
2.29 EXTERIOR OF THE CLUBHOUSE, RESTROOM BUILDINGS,
STRUCTURES AND GROUNDS
The City will be responsible for the repairs and maintenance of the building
exteriors and interiors.
GOLF COURSE WETLAND AREAS
Wetland areas must remain undisturbed to traffic, fertilizers, pesticides
and equipment. Litter and debris must be removed daily. Wetland signage
must be clean, readable and placed along both sides of Wetlands.
Replacements of all signage will the responsibility of the Contractor.
V. GENERAL CONDITIONS
A. Permits/Parking
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The Contractor shall be issued a free maintenance permit from the City's
. Department of Transportation. This will allow the Contractor's crews to
use City parking facilities at no charge during the term of this contract and
only while doing landscape maintenance work for the City's Open Space
and Parks Division.
B. . Payments and Inspection
Payment will be made for work satisfactorily completed as called for in this
contract. The City's Representative shall inspect and notify the Contractor
of any unsatisfactory work. Unsatisfactory work shall be corrected within
24 hours. The Contractor or the Contractor's representative shall meet
with a representative from the City at least once a month during the life of
this contract to inspect Work performed.
The Contractor will bill the City by the 5th of the month following service.
The City will pay the Contractor on a monthly basis for labor, equipment
and materials provided during the monthly billing period.
C. Use of Sanitary Landfill
The refuse disposal facilities of the city of Palo Alto Sanitary Landfill
located adjacent to East Embarcadero Road in said City will be made
available to the Contractor through the 2011 calendar year for the disposal
of all trees, rubbish and construction debris generated on work site. The
Contractor shall pay all dump fees. The Contractor shall at its sole
expense load, haul and deposit said rubbish and debris during normal
landfill operating hours. All landfill regulations will apply to all debris
deposited by the Contractor. Any questions regarding landfill rules and
regulations shall be directed to the Landfill Supervisor. A digest of the
refuse disposed area rules and regulations have been appended to this
contract. At the end of the 2011 calendar year, the The Contractor shall at
is sole expense load, haul and deposit all rubbish, debris and green waste'
to a transfer station located at the City of Sunnyvale.
D. Spare the Air Days
The Contractor must comply with regional "Spare the Air"
recommendations on designated "Spare the Air Days" that occur
throughout the year. At a minimum, no gasoline powered equipment shall
be used after 10 a.m. on "Spare the Air Days". The Project Manager will
notify the The Contractor when a "Spare the Air" alert has been
designated. The Contractor must coordinate work schedules to
accommodate "Spare the Air" recommendations.
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EXHIBITB
SCHEDULE OF PERFORMANCE
CONTRACTOR shall perform the Services so as to complete each task within the time
period specified in the Scope of Services, attached to this Agreement as Exhibit A.
CONTRACTOR shall provide the specified services according to the frequency and
schedule specified in Exhibit A.
CONTRACTOR shall execute the use of proper knowledge, skills, materials and
equipment of a timely basis to maintain all areas in a clean, safe, healthy, and
aesthetically acceptable manner during the entire term of this contract. The Contractor
agrees to be continuously alert in locating and defining problems and agrees to exercise
prompt and proper corrective action. Action times will be prioritized, and low priority
items will be given a time line for corrections.
Upon request CONTRACTOR shall provide a detailed schedule of work consistent with
completing the required Services as needed.
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EXHIBITC
SCHEDULE OF FEES
CITY shall pay CONTRACTOR, for the completion of Services performed to the reasonable satisfaction of
the CITY, a not to exceed sum in accordance with the schedule below. Any services provided or hours'
worked for which payment would result in a total exceeding the maximum amount of compensation set
forth herein, without prior authorization from CITY, shall be at no cost to City.
A. Schedule of Payment:
CITY shall pay CONTRACTOR a maximum compensation amount of One Million Eight Hundred
and Fifty Thousand Dollars ($1,850,000.00), payable over the 30 month term of this Agreement, for
Services performed based on current Golf Course configuration, as follows:
Year One, November 1, 2010 through April 30, 2011: $350,000.00, in monthly
increments of $58,333.33.
Year Two, May 1,2011 through April 30, 2012: $750,000.00 in monthly increments of
$62,500.00.
Year Three, May 1,2012 through April 30, 2013: $750,000.00 in monthly increments of
$62,500.00.
B. Equipment Purchase
Compensation is based on CONTRACTOR's Lump Sum Purchase of CITY's existing capital
equipment, as listed on Attachment 5 ofRFP 136681and attached herein as Attachment 1 for a
Sum Total of $ ..... ,.v,'v
--
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EXHIBITD
INSURANCE REQUIREMENTS
CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM
OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE
SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST'S KEY RATING OF A-:VII, OR
HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF
CALIFORNIA.
A WARD IS CONTINGENT ON COMPLIANCE WITH CITY'S INSURANCE REQUIREMENTS, AS SPECIFIED,
BELOW'
MINIMUM LIMITS
REQUIRED TYPE OF COVERAGE REQUIREMENT EACH
YES
YES
YES
YES
NO
YES
OCCURRENCE AGGREGATE
WORKER'S COMPENSATION STATUTORY
EMPLOYER'S LIABILITY STATUTORY
BODIL Y INJURY $1,000,000 $1,000,000
GENERAL LIABILITY, INCLUDING
PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE $1,000,000 $1,000,000
PROPERTY DAMAGE BLANKET
CONTRACTUAL, AND FIRE LEGAL BODILY INJURY & PROPERTY $1,000,000 $1,000,000
LIABILITY DAMAGE COMBINED.
BODILY INJURY $1,000,000 $1,000,000 -EACH PERSON $1,000,000 $1,000,000
AUTOMOBILE LIABILITY, -EACH OCCURRENCE $1,000,000 $1,000,000
INCLUDING ALL OWNED, HIRED, PROPERTY DAMAGE $1,000,000 $1,000,000 NON-OWNED
BODILY INJURY AND PROPERTY $1,000,000 $1,000,000
DAMAGE, COMBINED
PROFESSIONAL LIABILITY,
INCLUDING, ERRORS AND
OMISSIONS, MALPRACTICE (WHEN
APPLICABLE), AND NEGLIGENT .
PERFORMANCE ALL DAMAGES $1,000,000
THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT
ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND
EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE
INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND
ITS SUB CONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS'
COMPENSATION, EMPLOYER'S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS
ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES.
I. INSURANCE COVERAGE MUST INCLUDE:
A. A PROVISION FOR A WRITTEN THIRTY DAY ADVANCE NOTICE TO CITY OF CHANGE
IN COVERAGE OR OF COVERAGE CANCELLATION; AND
B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE
FOR CONTRACTOR'S AGREEMENT TO INDEMNIFY CITY.
C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY'S PRIOR APPROVAL.
II. CONT ACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED
COVERAGE.
III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO
"ADDITIONAL INSUREDS"
10 Rev. January 11,2010
C:\Documents and Settings\esolhei\Local Settings\Temporary Internet Files\OLK34\CI I 136681 Contract Draft Document (2).doc
Attachment C
A. PRIMARY COVERAGE
WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED,
INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR
CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE
ADDITIONAL INSUREDS.
B. CROSS LIABILITY
THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE
POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED
AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS,
SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY.
C. NOTICE OF CANCELLATION
1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY
REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE ISSUING
COMPANY SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN
NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON
PAYMENT OF PREMIUM, THE ISSUING COMPANY SHALL PROVIDE CITY AT
LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF
CANCELLATION.
NOTICES SHALL BE MAILED TO:
PURCHASING AND
CONTRACT ADMINISTRATION
CITY OF PALO ALTO
P.O. BOX 10250
PALO ALTO, CA 94303
11 Rev. January 11,2010
C:\DoclIments and Settings\esolhei\Local Settings\Temporary Internet Files\OLK34\CII136681 Contract Draft Document (2).doc
Attachment C
EXHIBITE
BONDS
[ATTACH BOND FORMS IF BONDS ARE REQUIRED]
12 Rev. January 11,2010
C:\Documents and Settings\esolhei\Local Settings\Temporary Internet Files\OLK34\CI1136681 Contract Draft Document (2).doc
Attachment C
EXHIBITF
LIQUIDATED DAMAGES
It is mutually agreed by Contractor and City that if completion of the Services to
be provided by the Contractor under this Agreement is delayed beyond the time
specified in the Schedule of Performance, plus any authorized extensions of time,
City will suffer damages and will incur other costs and expenses of a nature and
amount which is difficult or impractical to determine. Accordingly, City and
Contractor, agree, as a method to fix the damages and not as a penalty, that in the
event of any such failure to perform, the amount of damage which shall be
sustained by City will be the sum of $ for each and every calendar day
during which the Services remain uncompleted beyond the time specified for
completion, plus any authorized extension of time. Should Contractor fail to pay
the liquidated damages to City, Contractor agrees that City may deduct and
withhold the amount of the unpaid damages from any amounts due or that may
become due to Contractor under this Agreement.
BY PLACING THEIR INITIALS BELOW, CITY AND CONTRACTOR·
ACKNOWLEDGE THAT THE AMOUNT SET FORTH ABOVE HAS BEEN
AGREED UPON AS THE PARTIES' REASONABLE ESTIMATE OF CITY'S
DAMAGES.
CITY CONTRACTOR
13 Rev. January 11,2010
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Attachment C
Unit Year Manufacturer Model
22;03 1997 JOHN DEERE 5200
2206 2000 FORD RANGER
2209 1997 JOHN DEERE 5310
2210 1986 CASE 480LL
2213 1997 TY-CROP TD460 TOP DRESS
2215 1997 JOHN DEERE 5300
2216 2008 TORO GREENSMASTER
2217 2008 TORO GREENSMASTER
2221 1992 TORO HYDROJECT 3000
2241 2005 TORO WORKMAN 2110
2242 2005 TORO WORKMAN 2110
2243 2005 TORO 3280-0
2248 2006 TORO PROCORE648
2250 1996 CHEVROLET C3500
2252 2001 JOHN DEERE TURF GATOR
2253 2001 JOHN DEERE TURF GATOR
2254 2001 JOHN DEERE PROGATOR 2020
2255 2000 JOHN DEERE PROGATOR 2020
2256 2000 JOHN DEERE PROGATOR 2020
2257 2001 JOHN DEERE 1200A
2258 2003 TORO GREENSMASTER
2259 2000 TORO GREENSMASTER
2262 2000 TORO GREENSMASTER
2263 2003 LASTEC 721XR
2264 2003 JOHN DEERE 3235
2265 2002 JOHN DEERE 3235
2266 2007 TORO REELMASTER
2267 2008 LASTEC 721XR
2275 1965 FMC (BEAN) FG1010
2276 1980 GANDY N/A
2280 1999 TURFCO SP-1530
2281 1988 TORO GROUNDMASTER 62
2282 1990 TURFCO METERMATIC II
2283 1987 FORD 786A
2295 2001 JOHN DEERE AERCORE 2000 ----------
Attachment 1
City Equipment List
Description
UTILITY TRACTOR -FOUR WHEEL DRIVE
XCAB
TURF TRACTOR
TRACTOR LOADER
TD-460 TOP DRESSER
UTILITY TRACTOR -TWO WHEEL DRIVE
3100 GREENS MOWER W/8 BLADE CUTTING
3100 GREENS MOWER W/8 BLADE CUTTING
WALK-BEHIND TURF AERIFIER
UTILITY VEHICLE. (TURF)
UTILITY VEHICLE (TURF)
ROTARY TURF MOWER
WALKING GREENS AERATOR
TWO YARD DUMP TRUCK
UTILITY VEHICLE
UTILITY VEHICLE
UTILITY VEHICLE
W/2WD CARGO BOX
UTILITY TRUCK W/HD200 SPRAYER
BUNKER RAKE
3100 GREENS MOWER W/11 BLADE CUTTING
3100 GREENS MOWERW/8 BLADE CUTTING
3100 GREENS MOWER W/11 BLADE CUTTING
TRACTOR-MOUNTED ROUGH MOWER
FAIRWAY MOWER
FAIRWAY MOWER
TRIPLEX TRIM MOWER (3100-0)
TRACTOR-MOUNTED ROUGH MOWER
SPRAY RIGyTRAILER MOUNTED (200 GALLON)
SPREADER BOX
TOWABLE TOP DRESSER
TURF MOWER
TOWABLE TOP DRESSER
THREE-POINT FLAIL MOWER ATTACHMENT
FAIRWAY AERIFIER -------
Current Mtr
5,456
32,597
5,595
2,993
0
5,796
852
637
590
1,747
1,558
523
58
15,220
24,560
20,602
3,927
3,435
446
4,577
3,141
3,911
3,433
0
2,685
3,992
1,134
0
out of service
out of service
0
0
out of service
out of service
0
Orig Cost
18,935
17,717
23,748
52,317
18,048
24,520
0
0
25,000
8,725
8,725
18,654
18,426
32,391
6,917
6,917
23,196
17,215
20,582
11,929
18,895
20,297
20;297
17,861
39,817
40,602
26,659
0
0
5,000
0
0
5,500
0
27,014 I
>-.-;-
.-;-
Sll n
::r"
8
('[)
~ .-;-
n
Attachment C
Attachment D
TO: HONORABLE CITY COUNCIL
FROM: CITY MANAGER DEPARTMENT: COMMUNITY SERVICES
DATE: NOVEMBER 17,2008 CMR: 446:08
REPORT TYPE: STUDY SESSION
SUBJECT: Operational Analysis of the City Palo Alto Municipal Golf Course
EXECUTIVE SUMMARY
In 2007 the City Council authorized staff to proceed with an operational analysis of the Palo Alto
Municipal Golf Course ("Golf Course"). The operational analysis (Attachment A), was
conducted by Economics Research Associates (ERA), and provides information on the Bay Area
golf market and conditions of the Golf Course facility; and the current and alternative operating
models available for the Golf Course. The study found that, despite a Bay Area wide decline in
golf play, the Golf Course performance has been relatively strong when compared with similar
municipal facilities in the market area.
The ERA study and staff report recommends several actions for future success of the Golf
Course, which includes: making relatively minor but strategic investments in the Golf Course
infrastructure and operating structure along with actively participating in the planning of flood
control alternatives for San Francisquito Creek to find a balanced flood control/recreational use
solution that would benefit the Golf Course. Additional recommendations include aligning tenant
contracts to expire concurrently and to evaluate options to enhance Golf Course maintenance,
including the advantages and disadvantages of private versus public maintenance. Various Golf
Course operating models are described in the ERA report, each with advantages and
disadvantages. In the short term, no recommendation is proposed to alter the current operating
model until the flood control plans for San Francisquito Creek, which may impact the Golf
Course, are clearly defined.
Staff is presenting this report to Council for information and preliminary feedback. This item
will be placed on the Finance Committee agenda in the future for further discussion and
recommendations to Council.
BACKGROUND
The Golf Course was constructed in the mid 1950's on 184 acres of flat former salt-marsh and
bay fill. The course was designed by noted golf course architect William R. Bell of Pasadena,
California. The Golf Course was designed as an I8-hole facility with a par of 72. The Golf
Course is a classic 18-hole championship course that measures over 6,800 yards from the back
CMR: 448:08 Page 10f8
Attachment C
tees. The facility includes a large practice putting green, a three-building Eichler-designed
clubhouse/golf shop complex and parking lot. In the mid 1970's, improvements were made to
replace the clubhouse buildings. At that time, holes 3, 10, 11, & 18 were renovated under the
direction of golf architect Robert Trent Jones, Jr.
In 1992, the City Council initiated a Master Improvement Plan process (CMR 453:92) for the
Golf Course that would incorporate the findings of all prior studies, as well as look to the future
for necessary improvements to the aging facility. The firm of Halsey Daray Golf was selected to
prepare the Master Plan. Subsequently, in 1998, Certificates of Participation (COP's) were
issued in the amount of $7,750,000 (CMR 357:98) to fund the master plan improvements, and
work commenced on the driving range, fairways, greens and tees in 1999. Due to escalating
project costs and funding limitations to make the annual debt service payment the COP issuance
only addressed 40 percent ofthe proposed master plan improvements.
The Golf Course is a City of Palo Alto General Fund operation. All excess revenues or shortages
are returned to the City's General Fund. The Golf Course currently generates sufficient revenues
to support debt service, direct and indirect expenses, and City cost plan charges. There is no
reserve or replacement fund for the Golf Course, consequently; additional debt service is taken
on by the Golf Course wh~n new capital improvement needs arise. The debt service for the
COP's, which represents approximately $570,000 annually, will be fully retired in 2018.
Presently, the City has a management agreement and a lease agreement with Brad Lozares for
golf operations. As a result of Internal Revenue Services (IRS) debt issuance limitatipns, the
management agreement and the lease for the building are separate contracts. The management
agreement includes the following responsibilities: reservations; green fees collection; starting;
and marshalling services. The lease agreement for the building includes responsibility for:
managing golf cart rentals; the driving range; merchandise sales; and instruction services. Mr.
Lozares's management agreement with the City for operating the Golf Course expires December
31,2009. The lease agreement with Mr. Lozares for lease of the building expires in April 2013;
. the building lease also includes an option to extend the term of the concession 10 additional
years, if the option is exercised at the City'S sole discretion.
There is also a lease agreement with R&T Restaurant Corporation (R&T) for food and beverage
services at the Golf Course. The R&T lease agreement for food and beverage operations expires
April 20, 2018.
Golf Course turf and irrigation maintenance is provided by the City's Community Services
Department, Recreation and Golf Division. The Club House and Pro Shop building maintenance
(exterior) and janitorial services are provided by the City's Public Works Department, Facilities
Management Division.
The Recreation and Golf Division Manager of the Community Services Department oversees
daily operations that include coordination of services between the tenants and City maintenance
staff in order to provide a seamless experience for visitors to the Golf Course. The Real Estate
Division of the Administrative Services Department oversees tenant leases.
CMR:448:08 Page 2 of8
Attachment C
Faced with increased competition in the regional golf market, challenges in the golf facility
physical product, and increased pressure on City finances, a study was conducted at the request
of former City Manager Frank Benest, and funding was approved as part of the 2007 budget
process, with the following two key objectives:
a) provide analysis on the Bay Area Golf market and conditions of the Golf Course
facility; and
b) provide analysis of the current and alternative operating models available for the Golf
Course.
In 2007, a scope of services was developed and an RFP process followed to retain a·consultant to
conduct the analysis. Economics Research Associates (ERA) was selected for their reputation in
the industry, experience conducting comparable studies for similar golf courses, excellent
references and reasonable fee proposal that met the City's budget for the project.
DISCUSSION
The ERA report (Attachment A) provides detailed information regarding the Golf Course that
will help put into context how the Golf Course has performed in recent years in comparison to
nearby courses, along with recommendations and options for future success of the· Golf Course.
Extensive public outreach was undertaken to capture the views and interests of stakeholders.
Among them were the Golf Advisory Committee, members of the Parks and Recreation
Commission, golfers who frequent the Golf Course, interested residents, and Baylands
enthusiasts, among others. A Golf Course survey was available at the course for six weeks and
2,500 surveys were mailed to golfers who frequent the Golf Course; 454 responses were received
and are summarized in the ERA report (Section V).
The study concludes that the Golf Course, as with others in the region, has been negatively
impacted by market forces over the last decade. With the entry of many new public and private
golf courses in the region, the market has become significantly more competitive. Due to this
extraordinary golf course inventory expansion, along with a downturn in the regional/national
economy, comparable Bay Area golf courses, on average, report a 17% decline in annual rounds
played from 2000 to 2007. The Palo Alto Golf Course has experienced a 16% decline in annual
play during this period. Sound management decisions, cooperation among the tenants, loans
from the General Fund, strategic maintenance choices and enhanced marketing have enabled the
Golf Course to continue to recover the costs of operations, fund related debt service, and to cover
City and Community Services Department (CSD) allocated overhead charges (Cost Plan). The
study points out that, despite the decline in play at the Golf Course, the operating performance
has been relatively strong compared to similar municipal facilities.
There are several options for the future of the Golf Course, each with its own set of challenges
and opportunities. The long term Golf Course operating models that the City may want to
consider include: Facility Lease; Management Agreement; City Self Operation; or a Hybrid
Model such as the City has currently. The advantages and disadvantages of these options are
described in Section VI of the ERA Report.
CMR: 448:08 Page 3 of8
Attachment C
In the near term, the choices for Golf Course improvements andlor changes to the operating
model, which the City may wish to consider, will likely be influenced by the results of the
pending flood control plans for San Francisquito Creek, being conducted by the Joint Powers
_ Authority and the Army Corps of Engineers.
Consequently, below are three alternatives to help spur discussion on the future of the Golf
Course, with a focus on the possible impacts and opportunities the flood control plans for San
Francisquito Creek may present.
A brief summary of three possible alternatives for moving forward are discussed below:
I. Make no changes, and work with the Joint Powers Authority (JP A) for San
Francisquito Creek flood control to minimize Golf Course impacts
The flood control plans for San Francisquito Creek, being conducted by the Joint Powers
Authority and the Army Corps of Engineers, has begun with the key objective of identifying
potential options to reduce flooding along the creek. A list of short-term projects will be
complete as early as 2010, with the possibility of breaking ground on an actual project by
summer of 2011. The flood control plans for San Francisquito Creek remain an important factor
in planning for changes and improvements at the Golf Course because the creek is adjacent to the
Golf Course and, at one time, traversed the land occupied by the course. Some of the
recommendations that come out of the flood· control study may necessitate modification of
portions of the Golf Course. One course of action may be for the City to work with the Joint
Powers Authority to find flood control solutions that have minimal to no impact on the Golf
Course.
The ERA report states that the Golf Course operating performance is satisfactory, particularly in
light of a very soft Bay Area golf market. Within the short term, two to three years, the operating
performance will likely remain stable with no significant change to the operating structure or
major investment in capital improvement to the Golf Course. The study does not identify any
urgent capital improvement needs or operational problems that need to be addressed in the short
term. On the contrary the Golf Course, as compared to the key competition, is performing better
than average. Given this fact, it is not unreasonable to, at least for the short term, make no
significant changes.
II. Actively participate in the planning of flood .control alternatives for San Francisquito
Creek, to explore possible balanced flood control I recreational use solutions that
would benefit the Golf Course; and pursue strategic operational modifications and
Golf Course improvements as outlined in the ERA Report
This alternative is most consistent with the ERA report and is also the alternative that staff
believes to be the most prudent at this time. The goal would be to optimize financial performance
through some strategic investments while working closely with the Joint Powers Authority on a
flood control project for San Francisquito Creek that will enhance the golf course. The specific
actions under this option would include the following:
o Retain a golf course design consultant to work with the Joint Powers Authority
and City staff to design an environmentally friendly flood control project that will
CMR: 448:08 Page 4 of8
Attachment C
balance flood control and recreational use solutions and also benefit the Golf
Course.
o Align the two tenant leases and management contract so they expire concurrently.
This would allow consideration of other, potentially more effective and efficient,
operating options and a smoother transition of operation, should that be deemed
advantageous in the future.
o Commit to a plan of cost neutral capital improvements, as outlined in the study
(summarized on page 1-12), to ensure the Golf Course remains competitive. That
is, proceed with improvements that are economically justified by increased net
operating income stemming from the improvements.
o Recalculate the Cost Plan allocation for the Golf Course to a more traditional golf
course operation allocation. This would allow for excess :fu.rids to be set aside to
establish a replacement reserve to fund ongoing minor capital improvement
andlor more intensive maintenance.
o Direct Community Services and other relevant City staff to further evaluate the
advantages and disadvantages of private versus public maintenance. The City
will meet and confer with the union on any labor issues which arise.
TIl. Embark on a sigttificant redesign of the Golf Course with or without a concurrent
. restructuring of the Golf Course operation that takes advantage of possible flood
control funds that may become available
The ERA report finds that the Golf Course is presently operating at a satisfactory level with
respect to cost recovery and annual rounds of play as compared to other comparable golfcourses
in the region, and can be maintained a~ such with minimal additional investment. However, if the
City aspires to build or move toward developing a true destination or signature golf course, a
new vision would need to be formulated. This could take several forms. For example, significant
design changes to the c.ourse could reflect more of a links-style course with wide-ranging natural
wetland grasses and round contours that provide undulations and slopes for a' more unique
golfing experience. Another concept could be to extend the lake on hole 11 through the fairways
on holes 3 and 18 to create two or more signature holes. These would be unique, challenging
holes that would bring golfers back to play again. Moreover, this concept may include partnerin~
with an entrepreneur to build and operate a destination restaurant, one that overlooks the 18t
hole and vistas of the airport; a restaurant with appealing ambiance and character for residents to
take out of town visitors to dine.
Several members of the community share this vision in one form or another. They believe that
with the right people and private investment, it is possible to create a better Golf Course that has a unique design, providing a long term competitive advantage in the market place. A
significantly enhanced Golf Course, coupled with a destination restaurant, could be a successful
strategy. Although this is a compelling vision, funding a comprehensive re-development project
at the Golf Course, even with possible flood control funds, would be very challenging,
particularly in the current economic environment.
CMR: 448:08 Page 5 of8
Attachment C
Related to the idea of a comprehensive Golf Course redesign, at Council's direction, staff has
investigated the possibility of re-designing the Golf Course in order to create room for playing
fields (CMR 168:06). This concept was extensively studied by the Planning staff and also
explored by the Parks and· Recreation Commission. In 2006, City staff and the Parks and
Recreation Commission concluded that the concept of playing fields at the Golf Course should
be deferred until the flood control options become more certain. Creating new playing fields
could be re-investigated as part of a comprehensive re-design but again this would add additional
expense which would be particularly challenging in the current economic environment.
Staff Preferred Alternative
At this time, staff recommends pursuing Alternative II. This alternative entails making relatively
minor but strategic investments in the Golf Course infrastructure and operating structure as
outlined in the ERA report along with actively participating in the planning of flood control
alternatives for San Francisquito Creek.
The goal would be to find a balanced flood control and recreational use solution that would both
improve creek flood control and benefit the golf course. Joint Powers Authority flood control
concepts include the Golf Course and provide a unique opportunity for possible Golf Course
enhancement if the City actively participates in the design and development of the project.
With regard to strategic investments in the Golf Course infrastructure and operating structure,
prior to the most recent economic downturn the golf market was. expected to remain relatively
stable for the next three years, the current economic conditions will likely present new
challenges in maintaining a stable level of play. Although the Golf Course is performing
reasonably well today, staff believes maintaining the status quo (Alternative I) is too passive a
strategy in a market that is increasingly competitive and dependent on discretionary income.
Given the current economic climate, it is imperative to commit to strategic investment in course
improvements and maintenance practices to ensure the City is providing the best possible golfer
experience. This will maintain or improve the City's place in the market and enable the City to
reach cost recovery targets.
Moreover, minimal cost neutral capital improvement, enhanced marketing such as the
implementation of online reservations and better course maintenance are all needed to ensure
long term success. Alternative III, which paints a more dramatic picture of chang~ and redesign
of the Golf Course is a compelling option and remains possible. This option can be preserved by
addressing the issues of aligning contracts and lease expiration terms and addressing the
advantages and disadvantages of private versus public maintenance as outlined in Alternative II.
lt also keeps open the potential for a more comprehensive re-design project that may have
additional recreational benefits such as adding playing fields.
RESOURCE IMPACT
Working with the JPA on a ·flood control/enhanced Golf Course design project will require
Community Service staff input, golf course design expertise, and public input. Golf course
design expertise may require consultant costs.
CMR: 448:08 Page 6 of8
Attachment C
In 'an attempt to maintain the standard cost allocation plan across City departments staff
recommends that, after further analysis by the Administrative Services Department, any
reduction in City Cost Plan charges to the Golf Course be reallocated within the Community
Services Department so as to not unfairly impact other General Fund activities. The ERA report
indicates potential savings of $250,000 to $300,000 to the City should the City pursue private
Golf Course maintenance. Staff will continue to monitor the increasing expenses to employee
benefits currently at 50 percent of salary and determine if maintaining in-house operations is
more economically or operationally efficient versus contracting out services. Staff will work
with the labor union to ensure that, ultimately, the best services are provided to the community.
Staff will continue to monitor ongoing revenue and expenditures to ensure that the Golf Course
operation is a viable operation for the c~mmunity.
The ERA report also points out the need for strategic capital investment in the Golf Course that
includes rebuilding of selective greens and bunkers and improved· golf cart storage to increase
the number of carts in order to attract more and larger tournament play. The actual resource
impact is to be determined with further analysis; however, the goal will be cost neutral capital
improvement, as outlined in the study. That is, improvements which are economically justified
by increased net operating income stemming from the improvements.
As mentioned above staff recommends that the Golf Course study be forwarded to the Finance
Committee to work through the alternatives available to ensure ongoing success of the Golf
Course operation and to return to Council with a feasible plan on how to proceed.
ENVIRONMENTAL REVIEW
No environmental review is needed at this time. However, should a Golf Course capital
improvement project be considered at a future date all appropriate environmental review and
consideration will take place prior to approval.
ATTACHMENTS
Attachment A:
Attachment B:
CMR: 448:08
Economics Research Associates -Operational Analysis of the City of Palo
Alto Golf Course
Executive Summary (Bullet Point Version)
Page 7 of7
Attachment C
PREPARED BY: ______________ ~--~---J=-----~hL--~---
DEPARTMENT HEAD APPROVAL:
CITY MANAGER APPROVAL:
CMR: 448:08
nterim Director, Community Services
Department
Page 8 of8
Attachment C
TO:
FROM:
DATE:
City of Palo Alto
City Manager's Report
HONORABLE CITY COUNCIL
CITY MANAGER DEPARTMENT: COMMUNITY SERVICES
DECEMBER 6, 2010 CMR: 440:10
REPORT TYPE: CONSENT
SUBJECT: Approval of Amendment Number 5 to the Management Agreement
With Brad Lozares for Golf Professional Service~ at 1875
Embarcadero Road, Extending the Term for 28 Months to April 30,
2013.
EXECUTIVE SUMMARY
In response to uncertain economic conditions, Council authorized a Golf Course study to
examine the Bay Area golf market and conditions of the Palo Alto Golf Course facility;
and the current and alternative operating models available for the Golf Course. The study
was conducted in 2008.
The study recommended several actions for future success of the Golf Course. The
recommendations included making relatively minor but strategic investments in the. Golf
Course infrastructure and operating structure. The study also recommended that staff
actively participate in the planning of flood control alternatives for San Francisquito
Creek by the Joint Powers Authority in order to find a balanced flood control/recreational
use solution that would benefit the Golf Course. Additional recommendations include
aligning tenant contracts to expire concurrently, and to evaluate options to enhance Golf
Course maintenance, including the advantages and disadvantages of private versus public
maintenance.
Council and staff have acted upon several of the recommendations from the Golf Course
study including actively participating in the planning of flood control alternatives for San
Francisquito Creek that would also' benefit the Golf Course and the transition to private
Golf Course maintenance, which will save the City approximately $200,000 annually. At
this time staff recommends aligning the expiration term of the Golf Course Management
Agreement with Brad Lozares with the Pro Shop Lease Agreement with Mr. Lozares to
CMR: 440:10 Page 1 of7
.. •
Attachment D
expire concurrently on April 30, 2013 (Attachment A). This recommendation IS
consistent with the recommendations in the 2008 Golf Course study.
RECO~~NDATION. .. .
Sta,f, recoiiifnends that the CounCIl approve and authorIze the CIty Manager or hIS
de~g'I;lee to execute the attached Amendment No.5 to the Management Agreement with
Brad Lozares (Golf Professional) for golf course professional services at the Palo Alto
Municipal Golf Course, 1875 Embarcadero Road (Golf Course), to extend the term of the
contract for 28-months to April 30, 2013 (Attachment A).
BACKGROUND
On March 16, 1998, the City issued tax-exempt bonds to finance Golf Course
improvements. Prior to the bonds being issued, the City and the Golf Professional had
operated under one lease agreement for both professional management services and the
lease of the City-owned Pro Shop facility. When the bonds were issued in 1998, IRS
regulations required that there be two agreements: a management agreement for Golf
Course professional services and a separate lease to operate the golf retail establishment
(Pro Shop).
In 1998, Council approved a 20.;.month management agreement and a 15-year lease with
the Golf Professional. The original management agreement was amended three times
prior to Council approval of a new restated management agreement (Agreement) on
January 27, 2003. The new Agreement set the fixed fee to be paid to the City Contractor
at $322,251 and removed the annual CPI adjustment. Cart rentals and driving range fees
were split, with the Golf Professional receiving 40 percent of the revenue and the City
receiving 60 percent. The agreement also provided a productivity reward equal to a stated
dollar amount based on increases of golf rounds, power golf cart rentals 'and driving
range sales. The agreement has been extended 4 times since 2006 as summarized below:
1. Amendment No. 1 -May, 2006. Council approved an agreement which: 1)
extended the term for an additional eighteen months; 2) increased the fixed fee
compensation by three percent to $27,333.00; and 3) reimbursed the Golf
Professional for 60 percent of the bank's credit card merchant charges attributed to
the golf cart rentals.
2. Amendment No 2 -May 2007. Council approved an agreement which: 1)
extended the term for one year to December 31, 2008; and 2) increased the fixed
fee compensation by two percent to $28,213.46.
3. Amendment No 3 -October 2008. Council approved an agreement which: 1)
extended the agreement for one year to December 31, 2009; 2) increased the fixed
fee by two percent to $28,777.73; and 3) adjusted the Golf Professional's
productivity reward to reflect current market conditions.
CMR: 440:10 Page 2 of7
Attachment D
4. Agreement No 4 -November 2009. Council approved an agreement which: 1)
extended the term for one year to December 31, 2010 at the same monthly fixed
rate as 2008 of$28,777.73.
The short term amendments to the Golf Professional contract have been a factor of
uncertain economic conditions over the past several years. In response to the uncertain
economic conditions, Council authorized a Golf Course study to examine the Bay Area
golf market and conditions of the Palo Alto Golf Course facility as well as the current and
alternative operating models available for the Golf Course. The study was conducted in
2008.
As stated in the Executive Summary the study recommended several actions for future
success of the Golf Course that included making relatively minor but strategic
investments in the Golf Course infrastructure and operating structure along with actively
participating in the planning of flood control alternatives for San Francisquito Creek to
find a balanced flood control/recreational use solution that would benefit the Golf
Course. Additional recommendations include aligning tenant contracts to expire
concurrently and to evaluate options to enhance Golf Course maintenance, including the
advantages and disadvantages of private versus public maintenance.
DISCUSSION
Staff have been working on the recommendations from the Golf Course study and have
made progress on several fronts. Regarding the San Francisquito Creek flood control,
Council has requested that the Joint Powers Authority (JPA) retain a golf course design
consultant to work with the JP A and City staff to design an environmentally friendly
flood control project that will balance flood control and recreational use solutions that
will also benefit the Golf Course. The JPA has been very supportive of the City's need
for fair and reasonable mitigation measures to the Golf Course for levee improvements.
The known impacts to the Golf Course at this time will include the need to redesign four
to six holes due to levee realignment and encroachment onto the Golf Course.
The Golf Course study also recommended the City consider contracting out Golf Course
maintenance to improve cost recovery and the overall standard of maintenance. In the
2011 Budget process Council approved the contracting out of Golf Course maintenance
and a contract with ValleyCrest was approved on October 25, 2010, to assume Golf
Course maintenance responsibilities CMR: 390: 10. Recognizing that Brad Lozares would
participate in the RFP process for the Golf Course maintenance contract, staff postponed
recommending the alignment of Brad Lozares' Golf Professional agreement with the Pro
Shop lease pending the outcome of the Golf Course maintenance contract.
With the contracting of the Golf Course maintenance complete, staff now recommends
aligning the two tenant contracts with Brad Lozares to expire concurrently. Aligning the
CMR: 440:10 Page 3 of7
Attachment D
Golf Professional agreement to expire on April 30, 2013 would align three of the four
principal agreements the City has to operate at the Golf Course:
1. Pro Shop Lease (expires April 30, 2013)
2. Golf Course Maintenance (expires April 30, 2013)
3. Golf Professional Services (will expire April 30, 2013 if approved)
4. Restaurant Concessionaire (expires 2018)
The fourth principal agreement the City has to operate the Golf Course is between R&T
Restaurant Corporation and the City to operate the Bay Cafe; the current term of this
agreement expires in 2018.
Aligning the City contracts that keep the Golf Course operational gives the City
flexibility in bidding more than one element of the Golf Course operation when the terms
expire. This mayor may not be of interest to the City in April 2013, but the alignment of
the various Golf Course contracts provides the opportunity to consider alternative
operating models
Regarding the Golf Course budget, in Fiscal Year 2010 revenues exceeded expenses by
$76,000. It is estimated that Fiscal Year 2011 revenues will exceed expenses by
$300,000.
Compensation for Brad Lozares' services includes a fixed management fee of $28,777. 73
per month for a total of $805,776 for the 28-month term and percentage fees based on
Golf Course productivity. The fixed fee has not increased since 2008 and no increases are
recommended for this amendment. The percentage fees also remain unchanged in this
agreement. The percentage fees are a revenue share between the City and Brad Lozares
for Driving Range revenue at 62% to the City, and 38% to Brad Lozares; and Cart Rental
revenue at 60% to the City and 40% to Brad Lozares. Revenue to Brad Lozares in
percentage fees over the term of the contract is estimated to be $681,333 in addition to
the fixed management fee.
The service level the Golf Professional and his staff provide is very professional and
greatly appreciated by our golfing patrons. The Golf Professional is very well regarded
throughout the golf community for outstanding customer service. The drop in the number
of annual rounds played, from a high of over 100,000 in. the late 1980's to its current
level of approximately 70,000 rounds in Palo Alto, echoes a national trend in the decline
of rounds of golf due to the proliferation of new courses in the 1980's and 1990's and
other economic factors. The Palo Alto Golf Course still ranks financially in the top ten
municipal golf courses in the Bay Area.
The current Management Agreement will expire on December 31, 2010. In order for the
Golf Professional to manage the Golf Course and receive compensation, IRS rules
CMR: 440:10 Page 4 of7
Attachment D
require that there must be an agreement in place. Under IRS regulations, the management
agreements must be for no more than 60 months. Each of the agreements and
amendments between the City and the Golf Professional have been for less than 60
months in order to allow both parties -to make refinements to the agreement that reflect
economic conditions and needs of the Golf Course.
RESOURCE IMPACT
The annual impact on the resources for this agreement is ·estimated to be the same as
2010. The cost of overall compensation to the Golf Professional including fixed and
percentage payments is estimated to be approximately $1,487,110, and this artiount is
included in the Community Services Golf Course budget.
POLICY IMPLICATIONS
The proposed 28-month extension is consistent with prior Council direction and will keep
the Golf Course operational under the current management conditions to April 30, 2013.
ENVIRONMENTAL REVIEW
Approval of, the amendment does not constitute a project under the California
Environmental Quality Act (CEQA); therefore, no environmental assessment is required.
/ATTACHMENTS
Attachment A: Amendment No.5 to Management Agreement
PREPARED BY: 42tJ~
ROBDEGEUS
Division Manager, Recreation Services
DEPARTMENT HEAD APPROVAL:
GREGBE S
Director, Community Services Department
CITY MANAGER APPROVAL: . ~,-w.~
~JAMESKEENE .
City Manager
cc: Golf Professional
CMR: 440:10 Page 5 of7
Attachment D
AMENDMENT NO.5 TO MANAGEMENT AGREEMENT
C3150541A, BETWEEN THE CITY OF PALO ALTO AND BRAD
LOZARES GOLF SHOP FOR PROFESSIONAL SERVICES AT 1875
EMBARCADERO ROAD, PALO ALTO
THIS AMENDMENT NO.5 to the Management Agreement C3150541A,
between the City of Palo Alto and Brad Lozares Golf Shop for Professional Services at
the Palo Alto Municipal Golf Course, ("Agreement,") is made and entered into this 7th
day of December, 2010, by and between the City of Palo Alto, a municipal corporation
(the "CITY") and Brad Lozares ("GOLF PROFESSIONAL").
RECITALS
A. GOLF PROFESSIONAL has assumed responsibility for and continued the
operation and management of course play for the Golf Course facility on behalf of
the CITY on the terms and conditions set forth in the Management Agreement
dated January 28,2003.
B. On May 15, 2006, the parties amended the Agreement to extend the term
December 31, 2007, and to increase the fixed fee to $27,660.25 per month and
reimburse GOLF PROFESSIONAL for sixty percent (60%) of finance charges
associated with the payment of service charges for golf carts by credit card.
C. On May 15, 2007, the parties amended the Agreement to extend the term to
December 31, 2008, and to increase the fixed fee to $28,213.46 per month.
D. On October 20, 2008, the parties amended the Agreement to extend the term to
December 31, 2009, and to increase the fixed fee to $28,777.73 per month.
E. On December 7, 2009 the parties amended the Agreement to extend the term for
one year to December 31, 2010 at the same fixed level of compensation
established in 2008 of $28,777.73 per month.
F. The parties now wish to amend the Agreement to extend the term of the
agreement to April 30, 2013 at the same fixed level of compensation as
established in 2008 of $28,777.73 per month.
NOW, THEREFORE, in consideration of the terms, conditions, and
provisions of this Amendment, the parties agree as follows:
SECTION 1. Section III ("Term") is amended in its entirety to read, as follows:
Attachment D
"III. TERM
The term of this Agreement shall commence on January 8, 2003 and end on April
30,2013.
SECTION 2. Section IV, A ("Compensation"), is amended in its entirety to read
as follows:
"IV. COMPENSATION
During the term of the Agreement, GOLF PROFESSIONAL shall receive a fixed
fee and percentage fees, as defined below (collectively the "Management Fee").
A. Fixed Fee
GOLF PROFESSIONAL shall receive a fixed fee during the term of this
Agreement for GOLF PROFESSIONAL's Golf Course and driving range
management, Golf Course marshaling and starting and cart rental services.
The fixed fee for the term of this agreement will be $805,776.44. The
fixed fee will be paid in twenty-eight equal monthly installments.
During the eighteen-month extension term from July 1, 2006 to
December 31, 2007, GOLF PROFESSIONAL shall receive
a fixed fee payable monthly in the amount of $27,660.25.
During the twelve-month extension term from January 1, 2008 to
December 31, 2008, GOLF PROFESSIONAL shall receive a
fixed fee in the amount of $28,213.46, monthly.
During the twelve-month extension term from January 1, 2009 to
December 31, 2009, GOLF PROFESISONAL shall receive a
fixed fee, in the amount of $28,777.73, monthly.
During the twelve-month extension term from January 1, 2010 to
December 31, 2010, GOLF PROFESISONAL shall receIve a
fixed fee, in"the amount of $28,777.73, monthly.
During the twenty-:eight month extension term from January 1,
2011 to April 30, 2013, GOLF PROFESISONAL shall receive a
fixed fee, in the amount of $28,777.73, monthly.
The CITY shall forward the fixed fee by the 5th working day of
the CITY's working month for the amount due for that month to
the GOLF PROFESSIONAL. If not received within ten calendar
days after the fifth working day of the month, a late charge of one
percent of monthly payment due and unpaid plus an administrative
fee of $45.00 shall be added to the payment due and unpaid, and
the total monthly sum shall become immediately due and payable
Attachment D
to GOLF PROFESSIONAL. The parties agree that such late
charges represent a fair and reasonable estimate of the costs that
GOLF PROFESSIONAL will incur by reason of the CITY's late
payments and that acceptance of such late charges in no event
constitutes a waiver of the CITY's default with respect to such
overdue payment, nor prevents GOLF PROFESSIONAL from
exercising any of the other rights and remedies granted hereunder
or by any provision oflaw."
B. Percentage Fees
In addition to the fixed fee, GOLF PROFESSIONAL shall receive
38% percent of the gross revenues of the driving range and retain
40% of the gross revenue of the golf carts, golf club and pull cart
rentals. Percentage fees for each month will be <;alculated and paid
no later than the lOth day of the following month. In no event,
-however, shall the cumulative percentage fees paid to GOLF
PROFESSIONAL for a single calendar year exceed the total fixed
fee payments described in section IV-A herein for that same
calendar year.
C. GolfCart Fuel Reimbursement
GOLF PROFESSIONAL shall reimburse the CITY quarterly for
fuel supplied to gas golf carts. Reimbursement shall be at the
current retail full service pump price on the date of billing for
unleaded . fuel, determined quarterly by the CITY. GOLF
PROFESSIONAL shall reimburse the CITY by no later than by the
20th day of the month following the close of
each quarter.
D. Productivity Reward (Incentives)
In order to enhance overall golf division business incomes,
customer service and golf professional revenues, a productivity
reward equal to a stated dollar amount based on increases of golf
rounds, gross power golf cart rentals and driving range sales
becomes effective with this agreement. In addition to the fixed and
percentage fees, the golf professional shall receive the following
productivity rewards based on exceeding the following baselIne
golf rounds and gross sales:
PAID GOLF ROUNDS: (FEE, DISCOUNT CARD & REPLAY ROUNDS)
* Greater than 72,000 rounds $3.00 PER ROUND
Attachment D
, FAX NO. :6023912992 Nov. 29 2010 09:06PM Pi
POWER GOLF CART RENTALS:
* Greater than $300,000
DRIVING RANGE SALES:
Ij< Greater than $400,000.
$100 PER $1,000 INCREASE
$200 PER $1,000 INCREASE
SECTION 3. Except as herein modified, all other provisions of the Agreement,
including any exhibits and subsequent amendments thereto, shall remain in full torce and
effect.
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment No 5 to Management Agreement on the date first written above.
CITY OF PALO ALTO BRAD LOZARES GOLF SHOP
BY:f}t&V . £OJ~
Name: BY'ctcl. F. La1...Qre. ~ City Manager
Purchasing Manager Title: OI.U N-t..-I jo J r-~ra t'€SS;oJl q l
APPROVED AS TO FORM:
Senior Asst. City Attorney
4
091 12(),ib 0073262
Attachment D
Financial Pro Formas and Supporting
Analysis for Reconfiguration Options
A, D, F, G
For Palo Alto Municipal
Golf Course
Prepared For:
City of Palo Alto
Rob de Geus, Division Manager
Recreation & Golf Services
1305 Middlefield Road
Palo Alto, CA 94301
Prepared By:
1150 South U.S. Highway One, Suite 401
Jupiter, FL 33477
(561) 744-6006
April, 2012
Attachment E
Financial Pro Formas and Supporting Analysis for
Reconfiguration Options A, D, F, G
Palo Alto Municipal Golf Course
Attachment E
Table of Contents
INTRODUCTION ....................................................................................................................... 1
PALO ALTO MUNICIPAL GOLF COURSE RECONFIGURATION OPTIONS .......................... 2
Goals and Objectives.......................................................................................................... 2
Option A.............................................................................................................................. 3
Additional Work .............................................................................................................................4
Option D.............................................................................................................................. 4
Additional Work .............................................................................................................................5
Option F.............................................................................................................................. 5
Additional Work .............................................................................................................................6
Option G ............................................................................................................................. 7
Additional Work .............................................................................................................................8
Deferment of Certain Improvements ................................................................................... 9
MARKET OVERVIEW ..............................................................................................................10
Demographics Summary....................................................................................................10
Golf Market Overview.........................................................................................................11
National Trends in Golf Demand and Supply..............................................................................11
Local and Regional Golf Supply and Demand Indicators............................................................13
Competitive Golf Market.....................................................................................................15
Summary Information – Primary Competitors .............................................................................16
Summary of Findings – Primary Competitors .............................................................................18
Palo Alto Golf Course Market Positioning Assessment ......................................................19
FINANCIAL PERFORMANCE MODELS FOR PALO ALTO GOLF COURSE .........................20
Recent Historical Palo Alto GC Performance .....................................................................20
Projections Based on “Option A”........................................................................................22
Key Assumptions.........................................................................................................................22
Pro Forma Estimate for ‘Option A’ Scenario – FY2012 – FY2021..............................................26
Projections Based on “Option D”........................................................................................29
Key Assumptions.........................................................................................................................29
Pro Forma Estimate for ‘Option D’ Scenario – FY2012 – FY2021..............................................32
Projections Based on “Option F” ........................................................................................35
Key Assumptions.........................................................................................................................35
Pro Forma Estimate for ‘Option F’ Scenario – FY2012 – FY2021..............................................36
Projections Based on “Option G”........................................................................................39
Key Assumptions.........................................................................................................................39
Pro Forma Estimate for ‘Option G’ Scenario – FY2012 – FY2021 .............................................42
Financial Projections Summary..........................................................................................45
Summary of Options....................................................................................................................45
Attachment E
Summary Results ........................................................................................................................46
Justifications for Revenue Projections ........................................................................................47
Other Considerations Regarding Improvement Options .............................................................48
Option “G” Sensitivity Analysis ...........................................................................................49
Option “G” Sensitivity Analysis - Summary for 2017...................................................................49
Option G Sensitivity Spreadsheets..............................................................................................50
OTHER ISSUES AND CONSIDERATIONS..............................................................................56
Market Position / Re-Branding Opportunity ........................................................................56
Economics of Potential Long-Term / Additional Improvements...........................................58
Cart Storage Building ..................................................................................................................58
Expanded Meeting Space ...........................................................................................................59
Range Performance Center ........................................................................................................59
Management Structure.......................................................................................................60
Long Range Concerns .......................................................................................................61
Potential Economic Development Of The Airport & Golf “Baylands Gateway” Area............64
Private Funding Possibilities ..............................................................................................65
APPENDICES...........................................................................................................................66
Appendix A – Comparative Supply Ratios – Palo Alto GC & Key Municipal Competitors ...67
Appendix B – Comparative Scoring of Reconfiguration Options.........................................68
Appendix C – Water & Power Use Discussion & Assumptions...........................................71
Appendix D – Review Of Probable Cost Estimates ............................................................73
Appendix E – Potential Long-Term Master Plan Improvements..........................................75
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 1
Introduction
National Golf Foundation Consulting, Inc. was retained by the City of Palo Alto in furtherance of
the City’s due diligence relative to the San Francisquito Creek Flood Control Project, which will
involve the reconfiguration of six or more holes at the Palo Alto Golf Course. NGF’s objective
was to help the City identify the expected financial impact from the improvements related to the
reconfiguration work under Plan Options A, D, F, and G.
Specifically, NGF has crafted 10-year cash flow pro formas that project the estimated net
financial impact of the proposed improvements, allowing the City to evaluate each of the four
reconfiguration options under consideration from an objective standpoint. Our analysis includes
expected impact on rounds played, fee structure, revenue generation, operating expenses, and
capital spending/debt. The pro formas also provide an estimate for lost revenues during the time
that the course is impacted and/or closed.
Other aspects of the NGF review include:
A market overview of the Palo Alto area, with an emphasis on area demographics
and key golf demand and supply indicators.
A competitive review, including a qualitative assessment of the impact that the
potential reconfigurations would have on Palo Alto Golf Course’s market/competitive
position.
A review of Forrest Richardson’s work regarding the potential implications from the
renovation options on facility branding and marketing.
NGF will also offer its opinion about the long-term implications and potential financial
impact of improvements associated with the longer range master plan, including
clubhouse expansion, cart storage, event areas, range performance center, range
enlargement, entry/parking, and the youth training area.
NGF will evaluate relevant options available to the City of Palo Alto for the continued
operation of Palo Alto Golf Course, including (but not limited to) continuing on an as-
is basis or outsourcing all management and maintenance to a full-service
management company. Viable options will be identified, and a discussion of the
costs, benefits, and financial implications of each operating scenario presented.
The study effort was managed by NGF Director of Consulting Services Richard B. Singer and
Senior Project Director Ed Getherall. Activities conducted in completion of this report included:
field research; statistical and financial analysis; meetings with key City staff from the Recreation
& Golf Services, Administration, Community Services, and Finance Departments; meetings with
the Head Golf Professional, Golf Course Superintendent, and ValleyCrest Area Director; a tour
of the golf course; and, interviews with area golfers.
Following is the consultants’ report summarizing key findings and recommendations.
Throughout this report, we may refer to shortened names for: the City of Palo Alto (“City”), the
Palo Alto Municipal Golf Course (“Palo Alto Golf Course”, “Palo Alto GC” or “PAGC”), and
National Golf Foundation Consulting, Inc. (“NGF Consulting” or “NGF”).
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 2
Palo Alto Municipal Golf Course
Reconfiguration Options
NGF Consulting was provided four course reconfiguration options prepared by Forrest
Richardson, ASGCA. These options were identified by the titles “Option A,” Option D,” “Option
F” and “Option G,” and each have unique characteristics. The options represent four possible
scenarios for adjusting the course to accommodate the SFCJPA flood mitigation project.
Options A, D, F and G were culled from seven proposed alternatives (Options B, C, and E were
eliminated prior to our review) as the most viable and potentially opportune for the City.
The process for developing options has been thorough, with extensive input from golfers, staff,
concessionaires and the public at large. NGF Consulting has reviewed notes and summaries
from these meetings to better understand the goals and objectives desired by those who will
use and operate the facility following reconfiguration.
GOALS AND OBJECTIVES
Among the goals and objectives set forth to guide the design process for reconfiguration
options, in addition to the fundamental goal to accommodate the flood project, included:
Establish a more natural, aesthetic landscape that incorporates a “Baylands” theme
Improve tree care and variety via a theme to use appropriate tree selection
Find ways to eliminate geese and burrowing animals from ruining the course
Improve bunkers (condition, strategy and aesthetics)
Improve overall course conditioning (drainage, irrigation, turf, etc.)
Adjust yardage so the course is shorter for beginners, women and seniors
Create a “wow factor” to remain competitive with other regional facilities
Add interest to the course strategy (dog-legs, differentiation of holes, etc.)
Find ways to offer player development opportunities (short game area, range, etc.)
Additionally, there was a strong desire to address long range issues that face the aging facility
beyond those on the golf course itself. The City commissioned its own scope of work to address
these issues concurrently with the course reconfiguration planning. These long range areas
included the following:
Clubhouse planning
Entry, parking and signage
Practice areas
Cart storage and staging
On-course restrooms
Branding and image
Trail connections from the Baylands and existing trails
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 3
The objective of the additional long-range planning was to look beyond the golf course to ensure
that reconfiguration options would not preclude improvements to the areas on the above list.
Specific goals and objectives included the following:
Find ways to bring non-golfers to the facilities (group events, restaurant, etc.)
Expand the clubhouse to seat 200 so larger groups can be accommodated
Develop areas to hold multiple outings/events simultaneously
Improve the arrival experience, entry aesthetics, trail connections and security
Develop a cart storage area/facility
Make overall improvements to the clubhouse and grounds (exterior and interior)
Improve and expand the practice range
Create new player development and practice opportunities
Plan for upgrading the on-course restroom facility
Develop a new brand and image consistent with the reconfiguration goals and design
A common thread among the long range planning components was a strong design to return the
facilities, with golf course approaching its 60th year and the clubhouse its 30th, to a “Point of
Pride” status within the community. Along with this primary objective come the benefits of
leveraging the facility for economic development, tourism and as a home to annual and special
events. Secondarily, the community has a strong desire to see the golf course be more
compatible with the Baylands environment. This goal is echoed by Mr. Richardson in his
reconfiguration options, each of which adds more naturalized areas to the golf course. In
addition, long range design concepts associated with the clubhouse, entry and image go hand-
in-hand with this goal.
OPTION A
Option A represents the minimum reconfiguration in order to facilitate the San Francisquito
Creek realignment as required by the SFCJPA. This option shifts holes laterally from west to
east, retaining much of the same routing of the existing course. Golf holes are moved away from
the levee on a minimal basis. Improvements are primarily restricted to the holes moved, with the
remaining holes largely unchanged. Bunker work and naturalization enhancements are made
throughout the course in order to provide a more consistent golf experience and landscape.
The highlights of changes in this option include:
6.5 golf holes relocated
5 new greens constructed
Par 72
6,900 / 6,500 / 5,200 yards
All bunkers reconstructed and/or new
38.5 acres transformed to naturalized areas (non-managed turf)
Revised Hole No. 18 (naturalized hazard)
Adjusted Hole No. 12
Adjusted Hole Nos. 13 and 14
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 4
The total projected cost for this option is $3,537,622, including all professional fees,
project management and contingency.
Additional Work
Additional (“alternate”) items within the golf course itself may be undertaken by the City
concurrently with the development of Option A. These optional items include:
Sand capping of new turf areas (new fairways to be constructed)
Use (spreading) of imported soil from the Stanford University Medical Center Project
Reconstruction of all greens (13 additional to those covered)
Re-turfing of all existing fairways (23.5 acres additional)
Replacement of the balance of the existing irrigation system
Reconstruction and features at the existing practice green area
Construction of a new on-course restroom facility
Projected Cost for Additional Items: $ 3,250,500
Among the additional (alternate) work, Mr. Richardson and NGF recognize that the full
replacement of the existing irrigation system will become an eventual necessity. Our
understanding is that the existing system, installed in 1998, presents regular issues due to
deteriorating pipe fittings. Now entering its 14th year of service, the system is on the decline due
to the high salts inherent within the soils. Even if the balance of the system remains in
commission for another six years (20 years is a reasonable longevity for irrigation systems)
there exists good probability that emergency repairs and costs may escalate. For this reason,
we have studied this additional cost ($857,500) as an alternative scope to be considered for
Option A.
OPTION D
Option D represents an enhanced reconfiguration version from Option A. This option facilitates
the San Francisquito Creek realignment as required by the SFCJPA. The primary difference
from Option A is that Option D realigns holes with more variety, departing from the common
parallel routing of the existing course. Golf holes are moved away from the levee, but go beyond
Option A to form new views and variation. Bunker work and naturalization enhancements are
made throughout the course in order to provide a more consistent golf experience and
landscape. These are more prevalent than that afforded through Option A.
The highlights of changes in this option include:
8.5 golf holes relocated
8 new greens constructed
Par 72
6,900 / 6,400 / 5,000 yards
All bunkers reconstructed and/or new
43 acres transformed to naturalized areas (non-managed turf)
New Island Green Hole No. 13 (elevated tee and Bay view)
New Double Green Nos. 3 and 15
New Hole No. 5 (elevated green and Bay View)
New Hole No. 7 (split fairway)
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 5
New Hole No. 18 (par-5 and naturalized hazard)
New Hole No. 4
New Hole No. 17
New Hole No. 16
Future space afforded for a new practice green/short game area
The total projected cost for this option is $4,118,748, including all professional fees,
project management and contingency.
Additional Work
Additional (“alternate”) items within the golf course itself may be undertaken by the City
concurrently with the development of Option D. These optional items include:
Sand capping of new turf areas (new fairways to be constructed)
Use (spreading) of imported soil from the Stanford University Medical Center Project
Reconstruction of all greens (10 additional to those covered)
Re-turfing of all existing fairways (21.5 acres additional)
Replacement of the balance of the existing irrigation system
Reconstruction and features at the existing practice green area
Construction of a new on-course restroom facility
Future development of a new practice green/short game area
Projected Cost for Additional Items: $ 3,096,250
As with Option A, we recognize that the full replacement of the existing irrigation system will
become an eventual necessity. The same comments apply to Option D as noted for Option A.
We have studied the additional cost ($740,000), which is lower for Option D as more of the
existing system is covered within areas impacted by the reconfiguration, as an alternative scope
to be considered for Option D.
OPTION F
Option F represents an opportunity to remove land from golf course use and transform it to use
for athletic field(s). This option was added to the reconfiguration scope of the golf course
architect based on previous studies with the same objective. For Option F, a general constraint
placed on the planning work was to retain yardage (6,800 yards) and a par of 72. Safety from
the new trail system and within adjoining holes was to be maintained with no compromise to
standard guidelines.
Option F facilitates the San Francisquito Creek realignment as required by the SFCJPA. The
option is primarily distinguished by the removal of approximately 2.5 acres from the golf course
parcel. This land area is shown as athletic field use, accommodating a full NCAA sized soccer
field or combination of fields and field types of the same proportion and area. This area would
have limited room for parking expansion.
Option F realigns holes with more variety than in Option A. As with Option D, the reconfiguration
departs from the common parallel routing of the existing course. Golf holes are moved away
from the levee to form new views and variation. Bunker work and naturalization enhancements
are made throughout the course in order to provide a more consistent golf experience and
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 6
landscape. As a result of the “domino effect” of moving holes to make room for the athletic field
area, these enhancements are as prevalent as that afforded through Option D.
The highlights of changes in this option include:
12.5 golf holes relocated
12 new greens constructed
Par 72
6,700 / 6,300 / 5,000 yards
All bunkers reconstructed and/or new
43.4 acres transformed to naturalized areas (non-managed turf)
New Island Green Hole No. 13 (elevated tee and Bay view)
New Double Green Nos. 3 and 15
New Hole No. 5 (elevated green and Bay View)
New Hole No. 7 (split fairway)
Revised Hole No. 18 (naturalized hazard)
New Hole No. 4
New Hole No. 17
New Hole No. 16
New Hole No. 3
New Hole No. 3
New Hole No. 15
New practice green/short game area developed along with reconfiguration
Temporary preparation of the athletic field area (not field development or
improvement)
The total projected cost for this option is $5,855,454, including all professional fees,
project management and contingency.
Additional Work
Additional (“alternate”) items within the golf course itself may be undertaken by the City
concurrently with the development of Option F. These optional items include:
Sand capping of new turf areas (new fairways to be constructed)
Use (spreading) of imported soil from the Stanford University Medical Center Project
Reconstruction of all greens (6 additional to those covered)
Re-turfing of all existing fairways (21.5 acres additional)
Replacement of the balance of the existing irrigation system
Reconstruction and features at the existing practice green area
Construction of a new on-course restroom facility
Projected Cost for Additional Items: $ 2,530,000
As with Options A and D, we recognize that the full replacement of the existing irrigation system
will become an eventual necessity. The same comments apply to Option F as noted for previous
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 7
options. We have studied the additional cost ($425,000), which is lower for Option F (than for A
or D) as more of the existing system is covered within areas impacted by the reconfiguration, as
an alternative scope to be considered for Option F.
OPTION G
Option G represents a plan to remove more land from golf course use, transforming this land to
use for multiple athletic field and non-golf recreation purposes. This option was added to the
reconfiguration scope of the golf course architect based on the direction of the City to
investigate whether the viability of the golf course could be preserved while opening more area
(than with Option F) for non-golf recreation.
The constraint placed on the planning work was to retain a regulation layout with a par of 70 or
71. Safety from the new trail system and within adjoining holes was to be maintained with no
compromise to standard guidelines.
NGF Consulting was in the very early stages of our consulting work for the City when Option G
was put into motion. Among the foremost questions we were asked was whether a significantly
shorter course and/or a significantly lower par would be advisable for the City of Palo Alto. Our
conclusion was that the Palo Alto market, especially in the City’s situation as a single-course
owner, is best served in this locale by a regulation 18-hole golf course with a par of 72 being
preferred. This conclusion is based on several factors, including the following:
A strong history of this golf course producing annual rounds in excess of 80,000
Stated preferences by the current customer base to maintain length and par
Viability to host group golf events “demanding” a full-length course experience
Competitiveness to area courses
Long term viability to host regional events (qualifying, larger tournaments, etc.)
Regional offerings of shorter courses
Plan options that accommodate more flexible (shorter) yardages flexibility as part of
the reconfiguration work
NGF Consulting shared this conclusion with the City and the golf course architect,
recommending that Option G should, if possible, preserve a regulation length of about 6,500
yards (back tees) and a par of 72 preferred. If pressed to choose between a reduction in par (to
71) or a reduction in yardage lower than 6,500, we opined that it would be better to preserve
yardage at 6,500 and allow par to drop to 71. (Note: A par 71 course measuring 6,500 yards is
perceived as more difficult, and can be marketed such, than a course measuring the same
yardage but holding a par of 72. This is because the ratio of par to yardage is more
challenging.)
Option G also facilitates the San Francisquito Creek realignment as required by the SFCJPA.
The option involves the removal of approximately 10.5 acres from the golf course parcel. This
land area is shown as athletic field use (three full sized NCAA soccer fields or combination of
fields and field types of the same proportion and area), and additionally shows areas for a small
playground, wetlands park and picnic space, and trails connecting to the San Francisquito
Creek levee trails, Baylands and neighborhood.
Option G realigns holes with more variety than in Option A. As with Option D and F, the
reconfiguration departs from the common parallel routing of the existing course. Golf holes are
moved away from the levee to form new views and variation. Bunker work and naturalization
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 8
enhancements are made throughout the course in order to provide a more consistent golf
experience and landscape. As with Option F, but to an even greater extent, virtually all areas of
the existing course would be reconstructed, enhanced and improved.
The highlights of changes in this option include:
18 golf holes relocated
18 new greens constructed
Par 71
6,600 / 6,100 / 5,000 yards
All bunkers reconstructed and/or new
43 acres transformed to naturalized areas (non-managed turf)
Irrigated Turf Reduced from 135 acres to 92 acres
New Island Green Hole No. 12 (elevated tee and Bay view)
New Double Green Nos. 3 and 15
New Hole No. 5 (elevated green and Bay View)
New Hole No. 7 (split fairway)
New Hole No. 18 (par-5, naturalized hazard)
New Hole No. 4
New Hole No. 14
New Hole No. 10
New Hole No. 17
New Hole No. 16
New Hole No. 3
New Hole No. 3
New Hole No. 15
New practice green/short game area developed along with reconfiguration
Full irrigation system replacement (all areas of the 18-hole golf course)
Reconstruction and features at the existing practice green area
Construction of a new on-course restroom facility
Temporary preparation of the field/recreation area (not field development or
improvement)
The total projected cost for this option is $7,573,262, including all professional fees,
project management and contingency.
Additional Work
Additional (“alternate”) items within the golf course itself may be undertaken by the City
concurrently with the development of Option G. These optional items include:
Sand capping of new turf areas (new fairways to be constructed)
Use (spreading) of imported soil from the Stanford University Medical Center Project
Reconstruction of all greens (3 additional to those covered)
Re-turfing of all existing fairways (21.5 acres additional)
Replacement of the balance of the existing irrigation system
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 9
Projected Cost for Additional Items: $ 1,675,236
Unlike other options, Option G includes full irrigation replacement. This is because there is no
viable method of leaving only three golf holes without replacement. Variables include pumping
pressure, control zones and other logistics that had to be considered.
DEFERMENT OF CERTAIN IMPROVEMENTS
Other additional work listed under each option above has not been incorporated to the pro
formas prepared by NGF Consulting due to the complexity of attaching incremental rounds,
revenues and expenses to these improvements. However, both NGF and Mr. Richardson
believe that deferring some or all of the alternative (optional) improvements, including long-
range work to the clubhouse building, grounds, entry, practice areas, etc., will likely have a
negative affect on revenues and constrain somewhat the City’s ability to “re-brand” Palo Alto
GC.
Over the years, NGF Consulting has witnessed the implications of rounds and revenues on golf
facilities that have deferred maintenance and/or capital improvements. Eventually, golf course
conditions and/or the overall golf experience fall to a level where rounds, pricing and, as a
result, revenues are constrained, as is the municipality’s ability to effectively market the golf
course as anything other than a “value” provider. Golf consumers begin to migrate away from
facilities that are not well maintained when there are other proximate facilities offering better
conditions and/or equal or even slightly higher price points.
Among the optional/alternative improvements associated with Palo Alto Golf Course, we find the
most pressing are:
Course conditions, especially greens, drainage and turf condition
Yardage flexibility (to attract beginners, youth, women and seniors)
Geese and burrowing animal intrusion and damage
On-course restroom replacement
Clubhouse condition and available space
Most of the above are well corrected or mitigated though the reconfiguration options. However,
replacement of the irrigation system, as an example, is not fully afforded within the base work of
Options A, D and F. Especially in the case of A and D, this alternate cost may be prudent to
examine closer as conditions cannot dramatically improve course-wide without a plan to replace
the system. If the system is allowed to run for a long period without replacement, revenue is
bound to drop incrementally as turf conditions decline. In terms of substantive clubhouse
improvements, such as expanding the meeting space, improvements are not likely to pay for
themselves under the current operating structure whereby only 7% of food & beverage revenue
accrues to the City.
Yardage flexibility is accommodated in most of the options, but more so as more work is
covered. Options D, F and G adequately allow for more flexibility and will therefore have the
potential to attract more player types. The geese and burrowing animal issues, according to the
golf course architect, will be positively mitigated by all reconfiguration options. Yet, plan options
with more area impacted will likely result in more appropriate habitat and areas for these
animals to use rather than the turf areas currently intended for golfers.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 10
Market Overview
Below, NGF Consulting provides a summary of key “external” factors that characterize the trade
area in which the Palo Alto Golf Course operates. We include basic demographic variables that
have the potential to affect the economic performance of the golf facility, as well as an analysis
of supply and demand indicators in the public golf market.
DEMOGRAPHICS SUMMARY
Utilizing research materials provided by Applied Geographic Solutions, Inc. (a supplier of
demographic research based on U.S. Census results), NGF Consulting has examined relevant
characteristics of the local population. In the following tables, NGF Consulting indicates the
population, median age, and median household income trends for San Mateo and Santa Clara
counties, as well as the 3-, 10-, and 15- mile market rings surrounding the golf course and the
total United States.
Palo Alto Golf Course 3 mi 10 mi 15 mi
San
Mateo
County
Santa
Clara
County U.S.
Summary Demographics
Population 1990 Census 94,021 697,234 1,482,687 649,622 1,496,702 248,710,012
Population 2000 Census 100,652 765,828 1,662,257 707,161 1,682,585 281,421,906
CAGR 1990-2000 0.68%0.94% 1.15%0.85% 1.18%1.24%
Population 2010 Census 104,099 806,139 1,750,080 718,376 1,781,728 308,699,447
CAGR 2000-2010 0.34%0.51% 0.52%0.16% 0.57%0.93%
Population 2016 Projected 105,110 817,407 1,775,178 725,980 1,805,397 325,288,086
CAGR 2010-2016 0.16%0.23% 0.24%0.18% 0.22%0.88%
Median HH Inc $94,304 $96,743 $91,334 $88,233 $88,860 $53,908
Median Age 37.5 37.2 37.1 39.4 36.2 36.9
CAGR = Compound Annual Growth Rate
From the data collected for this study, NGF Consulting has made the following observations
regarding the demographics of Palo Alto and surrounding areas:
The 10-mile and 15-mile markets around Palo Alto GC are dense, with 2010
estimates of about 806,000 and 1.775 million residents, respectively, in these two
submarkets. The 10-mile market has added more than 40,000 net new residents
since 2006, while the 15-mile market grew by nearly 88,000 people. Population
growth is projected to be very moderate through 2016.
The Median Ages in the subject market areas are generally similar to the national
median age of 36.9 years, though San Mateo County overall is significantly higher at
39.4 years. In general, the propensity to play golf with greater frequency increases
with age, making relatively older markets more attractive to golf facility operators, all
other factors being equal.
Median Household Incomes in the area are much higher than the national median.
For instance, the 10-mile market exhibits incomes nearly 80% higher than the
national median income of $53,908. In general, higher income residents are more
likely to participate in golf, and they play more frequently than lower income
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 11
residents. These high figures are mitigated considerably by the very high cost of
living in the Bay Area.
GOLF MARKET OVERVIEW
Below we provide an overview of recent and emerging national trends with respect to golf
participation and municipal golf, as well as a summary of golf demand and supply indicators in
the local markets for Palo Alto Golf Course. NGF Consulting utilizes predictive models as
benchmarks for estimating potential market strength. The methodology for determining the
relative strength of the subject market is described in the following section.
National Trends in Golf Demand and Supply
Participation
Golf participation in the U.S. has grown from 3.5% of the population in the early 1960s to about
9.2% of the population today. NGF estimates that the number of golfers fell slightly in 2011 to
26.1 million; it was encouraging news that the number of golfers gained in 2010-11 held steady
vs. previous years while the number of lost golfers dropped significantly. For research purposes,
a golfer is defined as a person age 6 or above who plays at least one round of golf in a given
year.
All U.S. Golfers
(in millions)
1985 1990 1995 2000 2005 2010
All golfers age 6+ 19.5 27.4 24.7 28.8 30.0 26.1
Source: National Golf Foundation
The number of rounds of golf also fell 2.3% during the past year, from 486 million in 2009 to 475
million in 2010 (most recent year NGF has published), corroborating the decline in the number
of golfers. In the Pacific Region, which includes California, the statistics are somewhat more
favorable:
Regional Profile
Participation Rate Number of Golfers Percent of Golfers
Total Annual
Rounds (millions)
Pacific Region 7.3%3,276,000 12.5%50.4
United States 9.2%26,122,000 100.0%475.0
Source:Golf Participation in the U.S., 2011 edition, National Golf Foundation
Considering the severity of the recession and its effects on both discretionary income and time,
golf has held up rather well. Multiple NGF studies of golfers since 2008 would attribute the
gradual decline in golfers and rounds primarily to the impact of lower job security and concern
over personal finances, not waning appeal for the game.
Over the past 50 years, golf demand grew at about 4% per year while facility supply grew at
about 2% per year. However, since 1990, the situation has reversed – demand has grown at
only 0.5% per year while facility supply has grown at 1.4% per year. With the increase in supply,
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 12
we are seeing a marked increase in competition, and the supply is greater than the demand in
some markets.
In addition to increased competition, other factors have contributed to a decline in the number of
rounds per course nationally from 2002 to 2011. In the NGF’s most recent survey of core golfers
conducted in September 2011, we found that fearful financial outlooks, weak consumer
confidence, and negative golfer attitudes have also played a role. The combination of these has
caused many golf facilities to become distressed, particularly those that have a high debt load
because of higher construction costs and the perceived need to build high-end courses.
The number of golf course closings quadrupled from an annual average of 24 courses per year
in the 1993-2001 time period to more than 100 courses in 2005.In 2006, there was negative
net growth in golf facilities for the first time in six decades, with 146 18-hole equivalents
closing and 119.5 opening. In 2007, there were 113 openings and 121.5 closures, and in
2008, 72 golf course openings and 106 closures. In 2009, 49.5 openings minus 139.5 closures
equated to a net loss of 90 18-hole equivalents. Closures continue to be disproportionately
public, stand-alone 9-hole facilities or short courses (executive or par-3 length) with a value
price point. Net growth in supply has been negative now for four consecutive years, with the
largest drop of 90 courses in 2009. However, U.S. openings averaged 200+ (net) for 20 years,
and total 18-hole equivalent supply is up 5% since 2000, indicating a slow market correction is
underway. In October 2011, NGF projected 2011 net growth of about negative 106.5 (openings
minus closings), and projected actual closures for 2011 would be closer to 150.
NGF estimates that national rounds played experienced an overall drop from 2000 to 2010 of
-9.5%. By the end of 2011, rounds had further declined 2.5% in the U.S., but rounds in the
Pacific Region had increased 1.2% and California was up 2.3%.
On the positive side, the growth in golf course development has slowed considerably nationally
and in the majority of local markets, a trend that should help ease some of the competitive
pressure. Another positive trend is the aging of America. Baby Boomers are rapidly approaching
retirement age when golf activity flourishes. The baby boomers represent not only the largest
single demographic in the US, but they also approach retirement age with more disposable
income than any previous generation.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 13
Local and Regional Golf Supply and Demand Indicators
The following table summarizes some key golf supply and demand measures for the local
markets based on NGF research and golf demand predictive models.
Palo Alto Golf Course 3 mi 10 mi 15 mi
San
Mateo
County
Santa
Clara
County U.S.
Golf Demand Indicators
# of Golfing Households 6,989 55,008 116,506 49,136 116,439 21,237,600
Number of Rounds Played 226,453 1,769,537 3,717,852 1,571,308 3,765,371 498,831,616
Golfing Household Index 101 104 103 105 106 100
Rounds Played Index 140 142 141 143 146 100
Golf Supply Summary
Total Golf Facilities 2 13 25 14 33 15,902
Public Golf Facilities 2 8 16 6 20 11,633
Private Golf Facilities 0 5 9 8 13 4,269
Total Golf Holes 36 207 378 279 576 268,443
Public Golf Holes 36 117 225 108 342 191,214
Private Golf Holes 0 90 153 171 234 77,229
Household/Golf Supply Indicators
Households per 18 Holes: Total 19,132 25,655 29,805 16,754 19,127 7,733
Households per 18 Holes: Public 19,132 45,390 50,073 43,282 32,214 10,856
Households per 18 Holes: Private NA 59,007 73,636 27,336 47,082 26,879
Households Supply Index: Total 242 325 378 212 242 100
Households Supply Index: Public 171 405 447 387 288 100
Households Supply Index: Private 0 221 275 102 176 100
Golf Course Construction Activity 2001-2010
Total holes added past 10 years 0 0 18 0 72 24,318
Public holes added past 10 years 0 0 0 0 54 17,469
Private holes added past 10 years 0 0 18 0 18 6,849
Percent Total Holes Added 0.00%0.00%4.80%0.00%12.50%9.10%
Percent Public Holes Added 0.00%0.00%0.00%0.00%15.80%9.10%
Percent Private Holes Added NA 0.00%11.80%0.00%7.70%8.90%
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 14
Golf participation rates in the subject markets around Palo Alto GC are very similar to
the national benchmark, while rounds demanded per household are about 40%
higher than the national figure. The high rounds demanded per household are
indicative of the year-round golf climate, the high number of golf courses, and a
demographic profile that is generally conducive to high golf demand, particularly as it
relates to median household income.
There are thirteen total, including eight public, golf facilities (including Palo Alto GC)
in the 10-mile market area, while there are 25 total facilities, including 21 public,
within 15 miles of Palo Alto GC.
As the tables indicates, the subject markets have significantly more households per
18 holes of golf than the nation overall. For example, in the 10-mile market area
surrounding Palo Alto GC, there are nearly four times as many households per total
18 holes and 4.5 times as many households per public 18 holes than in the overall
U.S. (We contrast these supply ratios to some of Palo Alto’s key competitors in
Appendix A).
There was a spate of new golf course construction in the Bay Area in the 1990s and
early 2000s. For the nine-county Bay Area region, 27 total golf facilities were added
between 1997 and 2006. This included 6 private (comprising 90 holes) and 21 public
(360 holes) facilities. However, as with the rest of the country, new golf course
construction has slowed to a crawl in the subsequent years, and the NGF database
reveals no new golf course projects currently in planning or under construction within
15 miles of Palo Alto GC.
Palo Alto and the greater Bay Area are home to a large number of major corporate
and public employers, including many high-tech and internet companies. These large
employers are prime targets for soliciting tournament/outing play, and could be a key
element to boosting play levels and revenues at the Baylands GC. Outings are
generally sold at the highest green fee, and also expose a number of golfers to the
facility for the first time.
Visitors to the Palo Alto area have the potential to significantly impact demand at golf
courses. Though visitation numbers were not available for Palo Alto specifically, it is
estimated that about sixteen million people visit San Francisco alone each year, and
the overall Bay Area has considerably more visitors than that. NGF research shows
that roughly one-third of all golfers participate in the activity while traveling, playing
.557 rounds per day of travel. This supplemental market should be a target of
marketing efforts once the improved Baylands Golf Club is opened.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 15
COMPETITIVE GOLF MARKET
One of the objectives of this effort is to identify any opportunities that may exist for the improved
“Baylands Golf Club” to increase market share, fees and revenues. In this section, we present
an overview of the public access golf market in which the current Palo Alto GC operates, with a
focus on key competitors. The map below shows the location of these facilities in relation to
Palo Alto Golf Course.
In the tables that follow, NGF Consulting presents summary operational information for the golf
facilities identified as direct competition to the Palo Alto Golf Course. NGF Consulting identified
the primary competitors based on a number of factors, including price point, location, NGF
experience in this market, and input from both facility management and City staff.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 16
Summary Information – Primary Competitors
The table below provides summary information regarding the golf courses we have identified as
Palo Alto GC’s primary competitors.
Palo Alto Municipal Golf Course Key Competitors – Summary Information
Golf Facility Location Type
Year
Open Par / Slope
Front Tee /
Back Tee
Location Relative
to PAGC*
Palo Alto Municipal Golf Course Palo Alto MU 18H 1956 72 / 122 5,744 / 6,833 --
Crystal Springs Golf Course Burlingame MU 18H 1924 72 / 127 5,580 / 6,628 16 mi NW
Poplar Creek Golf Course San Mateo MU 18H 1933 70 / 115 4,768 / 6,042 14.5 mi NW
San Jose Municipal Golf Course San Jose MU 18H 1968 72 / 119 4,200 / 6,700 13 mi SE
Santa Clara Golf & Tennis Club Santa Clara MU 18H 1987 72 / 118 5,521 / 6,723 8.5 mi SE
Santa Teresa Golf Club San Jose DF 27H 1963 71 / 126 4,011 / 6,742 24.5 mi SE
Shoreline Golf Links Mountain View MU 18H 1983 72 / 129 5,437 / 6,996 2.5 mi SE
Spring Valley Golf Course Milpitas DF 18H 1956 70 / 113 5,453 / 6,116 15 mi E
Sunnyvale Golf Course Sunnyvale MU 18H 1969 70 / 118 5,170 / 5,742 5.5 mi SE
*Air miles from subject site, rounded to half-mile; actual driving distances will likely be greater.
Type: DF – Daily Fee; MU – Municipal
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 17
The table below shows summary facility information regarding Palo Alto Municipal Golf Course and its primary competitors. Reported
rounds for 2007 are from the 2008 Economic Research Associates report to the City. Average green/cart revenue per round for San
Jose and Santa Teresa are estimated based on ERA 2007 numbers.
Summary Operating Data – Palo Alto Municipal Golf Course and Primary Competitors
Golf Facility
Total 2007
Rounds
Total 2011
Rounds
Average
Green / Cart
Fee per
Round
18-Hole
Resident
Green Fee
(WD/WE)
18-Hole
Non-
Resident
Green Fee
(WD/WE)
Per Person
18-Hole Cart
Fee
18-Hole
Twilight
Green Fee
(WD/WE)
18-Hole
Senior
Resident
Green Fee
(WD/WE)
18-Hole
Super-Twi
Green Fee
(WD/WE)
Palo Alto Municipal GC 76,241 66,740 $30.20 / $4.50 $37/$47 $39/$49 $14 $30/$34 $28/DNA1 $26/$28
Crystal Springs Golf Course 73,654 63,000* $24 / $8 DNA $44/$66 $16 $36/$43 $30/DNA $26/$36
Poplar Creek Golf Course 86,315 70,709 $33.11 / N/A $33$45 $38/$53 $13.50 $27/$33 $22/DNA1 $19/$25
San Jose Municipal GC 86,991 78,000* $32 / $5 DNA $37/$51 $14 $26/$33 $23/DNA $20/$24
Santa Clara Golf & Tennis 87,120 81,000 $26 / $10 $25/$34 $37/$50 $14 $17/$23 res
$26/$29 n/r DNA2 $12/$14 res
$16/$18 n/r
Santa Teresa Golf Club 75,0003 65,000*$29.60 / $5.70 DNA $40/$46/$60 $13.50 $25/$29/$34 DNA $17/$19/$25
Shoreline Golf Links 67,135 50,000 $28 / $5.60 $31/$47 $38/$54 $12 $25/$28 $21/DNA1 $17/$17
Spring Valley Golf Course N/A N/A N/A DNA $37/$55 $14 DNA/$45 $28 M-F $27/$30
Sunnyvale Golf Course 80,513 72,535 $28 / $4.50 DNA/$44 $35/$48 $13.50 $25/$26 res
$25/$30 n/r DNA1 $16/$20
KEY
*NGF Consulting estimate N/A – Information not available DNA – Does not apply / Not offered
Note: For San Jose, Santa Teresa, “afternoon” rates used for twilight and “twilight” for supertwilight; for Spring Valley, “midday” and afternoon used for twi / supertwi.
1 Non-resident seniors pay $33 at Palo Alto, $28 at Shoreline; senior discounts at Poplar Creek are for residents only.
2 Santa Clara offers senior monthly ticket; Sunnyvale offers senior discount card.
3 Rounds listed are for regulation 18-hole course only.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 18
Summary of Findings – Primary Competitors
Based on data reported to NGF Consulting by area golf operators, Palo Alto Golf
Course is positioned quite similarly to its chief municipal competitors. The reported
average green fee revenue per round among the subject municipal facilities in 2011
generally fell between $28 and $32, while average cart revenue per round was most
commonly between $4.50 and $5.70.
Posted green fees have been generally flat in this market for the last several years,
with only periodic marginal increases aimed at cost recovery at some courses.
Non-resident green fees fall within a relatively narrow range among Palo Alto GC
and its municipal competitors, but NGF did note that Palo Alto is at the low end of the
non-resident pricing spectrum, particularly on weekends. We believe that an
improved and re-branded Palo Alto facility should be able to absorb $5 to $10
increases for non-resident rounds, depending on the reconfiguration option chosen
and varying by fee category.
Of the municipal golf courses profiled (leased Santa Teresa excluded), all but San
Jose Municipal offered a fee discount for residents (Sunnyvale restricted the discount
to weekends).
Most people NGF spoke to consider the city of Mountain View’s Shoreline Golf Links
Course to be Palo Alto GC’s most direct competitor. Shoreline’s reputation in terms
of maintenance standards has reportedly taken a hit in recent years, and the golf
course appeared to be in only fair condition during NGF’s visit. Shoreline has
dropped about one-third of its rounds since the mid 2000s and was the least active
facility among the key competitors in 2011, with a reported 50,000 rounds. Due to its
location, Shoreline probably suffers more than most Bay Area golf courses with the
Canadian Geese problem. There were also a large number of coots on the course
during our visit.
As was the case with nearly every golf market NGF examined nationally, average
annual rounds played at many Bay Area golf courses dropped by 25% or more
between the late 1990s / 2000 and the middle part of the 2000s. Based on rounds
reported to NGF as part of this study effort, rounds played among the direct
competitive set have continued to decline since the 2006-07 time period, though
variations in the most recent years are at least partly attributable to weather
variations.
Even with the falling activity levels, rounds played per 18 holes among the subject
municipal golf courses remain among the highest we’ve observed anywhere in the
U.S. Santa Clara Golf & Tennis and San Jose Municipal, at ±80,000 rounds in recent
years, are currently the most active among the competitive set.
Because of heightened competition and today’s economic realities, fee discounting
(e.g., through internal yield management, use of internet wholesalers such as
golfnow.com), even among high-end daily fee courses, is now common in the Bay
Area golf market. As a result, the lines can become blurred between “rack” rates and
what the majority of customers are actually paying for a round of golf. This disparity
is not common among the municipal golf courses we surveyed.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 19
PALO ALTO GOLF COURSE MARKET POSITIONING ASSESSMENT
NGF has attempted to provide a qualitative, or subjective, review of how Palo Alto GC, under
both its current configuration and the alternate reconfiguration options being considered, stacks
up against its key competitors as identified above. The objective of this relative assessment is to
provide some justification for assuming an increase in market share (and sustainable green
fees) for Palo Alto GC, especially with the more intensive renovation options.
NGF Consulting has scored the key competitors to the plan options (A, D, F and G) for Palo Alto
GC. A baseline score is also provided for the existing Palo Alto golf course and facility. This
scoring has been accomplished by looking at the amenities, course quality and reputation
associated with each competitive facility. Reliance has been made on available reviews, NGF
data, discussions with Bay Area golf writers/course reviewers and our visits to the subject
courses.
To rank the reconfiguration plans for Palo Also we relied on the schematic planning work
developed as of this date, together with our ratings for the plan options. Scores are expressed
as A+, A, A-, B+, B, etc. through D-. Because of the options (alternate) work to be considered,
no overall “average” grade is provided. Rather, categories of comparisons are provided. Such
scorings are both subjective and objective, combining impressions with facts about the facilities,
and in this case, proposed plans. Because of the subjective component of this review, personal
opinion and disagreement with some of the relative scoring should be expected. As such, the
scoring should be used as a method for the reader to form opinions in combination with the
other reporting covered within this report.
Comparison of Palo Alto GC to Key Competitors
Golf Facility
Clubhouse
Facilities
Practice
Facilities
Consumer
Reputation
Golf
Conditions*
Palo Alto (Existing)C-C+C+C
Palo Alto (Option A)C-C+B B-
Palo Alto (Option D)C-C+A-B+
Palo Alto (Option F)C-B A A-
Palo Alto (Option G)C-B+A+A
San Jose Golf Course D A-A-B-
Santa Clara Golf & Tennis B A-A-C+
Shoreline Golf Links B+B+C C-
Sunnyvale Golf Course C-D-D-C+
Crystal Springs Golf Course A-B+B+B
Poplar Creek Golf Course A-D B-B
Santa Teresa Golf Club B-B B-B-
Spring Valley B-B-C+C+
*As observed January-February 2012
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 20
Financial Performance
Models for Palo Alto Golf Course
As part of this study effort, NGF Consulting has prepared an analysis to show what the potential
economic performance of Palo Alto Municipal Golf Course could be considering the
reconfiguration options presented in this report. In this section, we estimate the facility’s
economic performance based on a set of assumptions that may or may not become reality. We
feel that these estimates represent the best effort to create a “fair estimate of performance” for
this facility based on our understanding of the golf facility operation, its place in the market and
the changes proposed in the various renovation options.
The Palo Alto Municipal GC performance has been projected under the assumption that the
operation is continued ‘as-is’ with three separate contracts for maintenance, pro shop and
food/beverage. The basic contract terms in place in FY2012 are assumed to continue through
FY2021. The NGF has also assumed a “standard” set of external assumptions for regional
economic performance, consumer discretionary income, and weather, with neither severe
declines nor increases in any of these measures through 2021.
RECENT HISTORICAL PALO ALTO GC PERFORMANCE
In order to put the pro forma projections in context, we have summarized the five-year
performance history of Palo Alto GC in the table below.
Palo Alto Municipal Golf Course
Historical Revenue Performance (2008-2011)
Revenues FY2008 FY2009 FY2010 FY2011
Green Fees $2,169,230 $2,073,809 $1,958,234 $1,859,473
Cart Fees 345,656 313,224 339,090 302,815
Driving Range 346,447 365,908 399,773 343,878
Monthly Play Cards 161,368 161,544 135,848 154,933
Tournament / League Fees 2,227 2,651 1,921 2,190
Class Program / Other Fees 0 0 0 11,844
Total Golf Course Revenues $3,024,928 $2,917,136 $2,834,866 $2,675,133
Other Revenue
Merchandise Sales 718,450 737,050 684,725 663,400
Food Sales 667,000 0 610,725 637,800
Liquor Sales 172,000 0 141,850 149,000
F & B Concession Payments
Fixed Lease $0 $43,811 $0 $0
Variable Portion $58,730 $0 $52,680 $55,076
Utility Payment $25,920 $19,440 $28,080 $25,920
Total F & B Concession Payments $84,650 $63,251 $80,760 $80,996
Pro Shop Concession Payments
Fixed Lease $0 $0 $0 $0
Merchandise (4%)$28,738 $29,482 $27,389 $26,536
Total Pro Shop Concession Payments $28,738 $29,482 $27,389 $26,536
Total Gross Margin to City $3,138,316 $3,009,869 $2,943,015 $2,782,665
Rounds Played 77,989 75,511 69,791 67,381
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 21
Palo Alto Municipal Golf Course
Historical Expense and Net Income Performance (2008-2011)
Expenses FY2008 FY2009 FY2010 FY2011
Salaries & Benefits $951,786 $929,335 $721,596 $259,455
Range Fees 138,579 152,745 142,267 130,152
Cart Fees 131,789 127,836 121,630 117,529
Club Fees 6,473 6,198 5,424 5,576
Fixed Lozares Management Fee 373,435 409,989 388,898 381,544
Contract Maintenance ---475,000
Repairs & maintenance 34,791 39,295 33,321 21,943
Advertising & Publish 5,560 6,583 4,299 10,765
Supplies and Materials 129,891 144,037 119,458 43,742
Gen., Rents, Fac. & Equip 5,959 2,736 944 675
Water Expense 279,326 409,132 271,495 361,870
Other Direct Charges 36,998 39,255 38,882 45,263
Indirect Charges 108,641 132,072 110,343 102,571
Total City Operating Expenses $2,203,228 $2,399,213 $1,958,557 $1,956,085
Net Income From Operations (Loss)$935,088 $610,656 $984,458 $826,580
Income from Sale of Property $35,230
D/S Income $33,629 $32,855 $32,200 $0
Total Non-Operating 33,629 32,855 32,200 35,230
Total Income (Incl. Non-operating)$968,717 $643,511 $1,016,658 $861,810
Debt Service $559,795 $555,686 $560,674 $559,539
Payment to General Fund $94,849 $94,849 $47,684 $94,849
Cost Plan Charges $337,590 $318,969 $332,155 $41,455
Total Debt / Other Charges $992,234 $969,504 $940,513 $695,843
Net Income or (Loss)($23,517)($325,993)$76,145 $165,967
Source: City of Palo Alto
Rounds played at Palo Alto GC decreased steadily from FY2008 to FY2011, falling by a
total of 10,608, or 13.6%. During the same time, both golf revenues and net income from
operations declined by 11.6%.
Despite the significant decline in rounds and revenues, net income after debt service,
general fund payments and cost plan charges improved by nearly $500,000 between
FY2009 and FY2011 due to a reduction in operating expenses and a significant
decrease in cost plan charges associated with the conversion to privatized golf course
maintenance.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 22
PROJECTIONS BASED ON “OPTION A”
NGF Consulting has created a cash flow model for the continued operation of Palo Alto
Municipal Golf Course (to be re-branded as “Baylands Golf Club) under the assumption of the
“Option A” improvements. These improvements assume the basic minimum upgrades needed
to improve the facility within the SFCJPA flood mitigation project, with no substantial change to
the character of the golf course. The NGF revenue estimate has been combined with the
present operating structure to provide a full estimate of Baylands GC performance for the next
10 years, assuming successful completion of the “Option A” upgrades. The NGF has projected
growth to over $2.8 million in total gross facility revenue to the City (from all sources) by 2016.
Key Assumptions
The Base assumptions in preparing the projected financial performance estimates covers
several categories, including rounds activity, green fees, average revenues (carts, range,
concessions, etc.), total revenue, expenses, capital and debt. Under all scenarios, we have
assumed use of more complimentary and discount rounds in the initial years after reopening for
the purposes of gaining back lost customers, stimulating trial, and general promotions.
Rounds Performance
The rounds activity performance assumptions include:
Rounds in FY2012 assume a 3% reduction from FY2011 total rounds based on
actual performance in the first 6 months of FY2012 as reported by staff.
Rounds in FY2013 assume ‘as-is’ operation on 18 holes for the first 9 months, then
operation on only 9 holes for the last 3 months. During the last three months a
reduction of 50% off historical rounds for the corresponding month is assumed. All
rounds from April-June 2013 are assumed to be 9-hole rounds.
Rounds in FY2014 assume operation on 9 holes for the first 6 months, then
operation with an upgraded 18 holes for January-June 2014. All rounds from July-
December 2013 are assumed to be 9-hole rounds with a reduction of 50% off
historical totals for the corresponding month.
Rounds projections assume increases to a stabilized level of 68,200 by 2017.
The overall distribution of rounds by category is shown in the table below:
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 23
Palo Alto Municipal Golf Course (Baylands GC)
Projected Activity for Option A (2012-2021)
As-Is
9-Mos. 18-H /
3 Mos. 9-H
6-Mos. 18-H /
6 Mos. 9-H
Operate on 18-holes with
modest upgrade
to the golf course design
FY2012 FY2013 FY2014 FY2015 FY2016
FY2017
-2021
Weekday
18-Hole 5,400 3,500 2,200 5,200 5,300 5,600
Senior Non-Resident 6,300 4,200 2,300 5,850 6,200 6,500
9-Hole 1,500 6,400 11,500 1,500 1,600 1,700
Senior 900 600 500 900 1,000 1,000
Junior 1,400 1,000 600 1,350 1,400 1,500
Early Bird 700 500 300 600 700 700
Twilight 11,300 7,800 4,500 10,800 11,000 11,600
Specials 7,500 5,400 3,500 9,400 7,600 8,000
Junior Card 1,100 800 500 1,050 1,200 1,200
Senior Card 800 600 400 900 1,000 1,000
Non-Resident Senior Card 4,000 2,600 1,500 3,750 4,000 4,200
Sub-Total Weekday 40,900 33,400 27,800 41,300 41,000 43,000
Weekend
18-Hole 10,200 7,000 4,000 8,550 9,800 10,300
9 Hole 1,900 8,700 12,500 1,850 2,000 2,100
Junior 800 600 400 800 900 900
Twilight 6,200 4,100 2,400 5,800 6,000 6,400
Sub-Total Weekend 19,100 20,400 19,300 17,000 18,700 19,700
Complimentary Play 2,500 1,700 1,200 2,500 2,500 2,500
Tournaments 2,200 1,500 1,000 2,000 2,500 3,000
TOTAL ROUNDS 64,700 57,000 49,300 62,800 64,700 68,200
Average Fees / Revenue
The average green fees per round by category are shown in the table that follows. Key
assumptions driving this estimate include:
There is no change in average fees for FY2012 over FY2011.
The only adjustment in FY2013 is for the 9-hole rate, which has been adjusted
downward to reflect the various forms of discounting expected to be present when
the facility is operating on only 9 holes in the final 3 months of FY2013 and the first 6
months of FY2014. NGF has assumed 9-hole green fee will go as low as $12.00 per
round in some discount categories (e.g., late afternoon replay rate).
Upon re-opening on 18 holes (assumed January 1, 2014), average fees in each
category are increased approximately 5% over FY2012 (rounded).
For FY2015 through FY2021, NGF has assumed 1% annual increases in all fee
categories.
Average Cart fee and driving range revenue per round in FY2012 is based on the
actuals in FY2011. For FY2013, average cart / range revenue per round is reduced
by 20% (from 2011) to reflect the operation on only 9 holes the last 3 months. For
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 24
FY2014, average cart and range revenue is reduced by 30% (from FY2011) to reflect
6 months on 9 holes. By FY2015, average cart and range revenue is restored at the
2011 level and then increased by 1% per year through 2021.
Average merchandise sales in FY2012 are based on the actual in FY2011. Average
sales are reduced by 20% (from 2011) in FY2013 to reflect 9 holes-only the last 3
months, and 30% in FY2014 to reflect 6 months on 9 holes. By FY2015, average
sales are restored to the 2011 level with 1% increases through 2021.
Average food and bar sales in FY2012 are based on the actual in FY2011. Average
sales are reduced by 20% (from 2011) in FY2013 to reflect 9 holes-only the last 3
months, and 30% in FY2014 to reflect 6 months on 9-holes. By FY2015, average
sales are restored to the 2011 level with 1% increases through 2021.
The average green fees by category and ancillary revenue per round are shown in
the table below (assume 1% annual increases for FY2018-2021 as noted):
Palo Alto Municipal Golf Course (Baylands GC)
Projected Average Green Fees for Option A (2012-2021)
As-Is
9-Mos.
18-H /3
Mos. 9-H
6-Mos.
18-H /6
Mos. 9-H
Operate on 18-holes with
modest upgrade to the golf
course design
FY2012 FY2013 FY2014 FY2015 FY2016 FY2017
Weekday
18-Hole $37.00 $37.00 $39.00 $39.39 $39.78 $40.18
Senior Non-Resident $32.00 $32.00 $33.50 $33.84 $34.17 $34.52
9-Hole $23.00 $18.00 $17.00 $25.00 $25.25 $25.50
Senior $28.00 $28.00 $29.50 $29.80 $30.09 $30.39
Junior $14.75 $14.75 $15.50 $15.66 $15.81 $15.97
Early Bird $23.00 $23.00 $24.00 $24.24 $24.48 $24.73
Twilight $30.00 $30.00 $31.50 $31.82 $32.13 $32.45
Specials $19.00 $19.00 $20.00 $20.20 $20.40 $20.61
Junior Card $19.70 $19.70 $20.75 $20.96 $21.17 $21.38
Senior Card $23.50 $23.50 $24.75 $25.00 $25.25 $25.50
Non-Resident Senior Card $27.50 $27.50 $29.00 $29.29 $29.58 $29.88
Weekend
18-Hole $47.00 $47.00 $49.50 $50.00 $50.49 $51.00
9 Hole $27.00 $24.75 $25.75 $28.75 $29.04 $29.33
Junior $15.80 $15.80 $16.50 $16.67 $16.83 $17.00
Twilight $34.00 $34.00 $35.75 $36.11 $36.47 $36.83
Tournaments $34.60 $34.60 $36.50 $36.87 $37.23 $37.61
Avg. Cart Fee / Round $4.54 $3.63 $3.18 $4.54 $4.58 $4.63
Avg. Range Revenue / Round $5.15 $4.12 $3.61 $5.15 $5.20 $5.26
Merchandise Sales / Round $9.94 $7.95 $6.96 $9.94 $9.94 $10.14
Food per Round $9.56 $7.64 $6.69 $9.56 $9.65 $9.75
Bar per Round $2.23 $1.79 $1.56 $2.23 $2.26 $2.28
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 25
Other Revenue Assumptions
Total green fee revenue includes all discount (10-play) cards and monthly passes.
Ancillary revenue per round (carts, merchandise, range, food, bar, other) is derived
from total rounds, including complimentary rounds.
Concession revenue to the City of Palo Alto assumes the same current contract
basics through FY2021,with no minimums after April 2013. The City is assumed
to collect: (1) 7% of all F & B revenue; and (2) 4% of merchandise sales.
Expense Assumptions
Labor expenses are for City oversight only. These include allocations for contract
oversight, Parks and Recreation Director, Division manager, etc. The estimate is
intended to include both salary and benefits allocation and is increased by 4.5% per
year through FY2021.
Commissions paid to the pro shop vendor include 38% of driving range gross
revenue and 40% of gross cart revenue (as per contract).
The pro shop management fee is fixed at $28,775 per month for the full duration of
the NGF projection.
Reimbursements for merchant fees (mostly credit card fees) are assumed to be
1.4% of total facility revenue.
Contract maintenance expense to the City of Palo Alto assumes:
$62,500 per month for FY2012.
$62,500 per month for the first 9 months, then $37,500 per months for the
last 3 months of FY2013.
$37,500 per month for the first 6 months, then $66,667 per months for the
last 6 months of FY2014.
$66,667 per month in FY2015, growing at 1.5% annually through 2021.
Other expenses such as repairs, maintenance, supplies, club fees, materials and
other indirect expenses are all based on actual figures for FY2011 with 20%
reduction in FY2013 and 30% reduction in FY2014, returning to FY2011 levels in
FY2015 plus 1.5% increases assumed through FY2021.
Advertising and publishing expense is reduced by 50% during construction and
operation on 9 holes, totaling 15% reduction in FY2013. Upon re-opening the golf
course this expense is assumed to increase to $45,000 to account for enhanced
marketing of the upgraded facility and re-theme as “Baylands GC.” Advertising and
publishing expense is then reduced in subsequent years to a “standard” of around
$17,000 per year.
Water expense has been highly variable and NGF projections are based on the 4-
year average (2008-2011), with assumptions of reductions in use as described
previously:
25% reduction during construction
28% reduction upon re-opening
Annual increases are assumed at 20% for 2013, 15% for 2014, 9% for 2015,
3% for 2016, 2% for 2017 and 4.5% for FY2018 through FY2021.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 26
Other direct charges (including electric) are based on actual figures for FY2011 with
20% reduction in FY2013 and 30% reduction in FY2014. A slight reduction expected
upon re-opening the golf course in FY2015 (as described by the architect). Annual
increase of 1.5% is assumed from FY2015 through FY2021.
Debt Service and Other Non-Operating Expense Assumptions
Non-operating revenue attributed to debt service is assumed to continue at 6% of
debt service payment as long as payments continue (through FY2019).
Debt service payments were provided by the City of Palo Alto.
The payment to the General Fund ($94,849) expires after FY2012.
There is a new payment of ± $107,000 to the General Fund from FY2015 – FY2019
for repayment of a loan for the difference between the estimated capital cost for
Option A and the expected reimbursement from the SFCJPA.
The Cost Plan Charges are based on actual 2011 charges with historical 3% growth
through the end of FY2021.
The NGF has added a new “Operating & Capital Reserve” line to the pro forma
beginning in FY2015, set at 10% of green fee revenue.
Option A also assumes that the full irrigation replacement will be completed in
FY2020 (or by 2020) at a cost of $750,000 (real 2012 dollars).
Pro Forma Estimate for ‘Option A’ Scenario – FY2012 – FY2021
Utilizing the above assumptions and activity/revenue estimates, NGF Consulting has prepared a
pro forma for the next 10 years of operation, including FY2012 (already underway). The table
shows that the renovated Baylands Golf Club could produce net income to the City in the range
of $690,000 to $950,000 (before debt, cost plan and reserve) through the term of the current
debt program. After the City is no longer responsible for debt payments (beginning in FY2020),
the facility is expected to produce net income to the City, after all expenses and charges, in the
range of ±$620,000, although a one-time expense of $750,000 is projected for 2020 to upgrade
the irrigation system. As this is a projection, all figures after FY2012 have been rounded to the
nearest $100 for simplicity.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 27
Palo Alto Golf Course Revenue / Expense - Option A
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Golf Course Revenues
Green Fees (Incl. Cards)$2,016,537 $1,960,100 $1,605,200 $1,313,900 $1,967,700 $2,090,000 $2,233,100 $2,255,400 $2,278,000 $2,300,700 $2,323,800
Cart Fees 302,799 293,500 206,900 156,600 284,900 296,500 315,600 318,800 322,000 325,200 328,500
Driving Range 343,911 333,400 235,000 177,800 323,600 336,700 358,500 362,100 365,700 369,400 373,100
Tournament / League Fees 2,196 2,100 1,900 1,600 2,100 2,100 2,200 2,200 2,200 2,200 2,200
Other 11,813 11,500 8,100 6,100 11,100 11,500 12,300 12,300 12,600 12,600 12,800
Total Golf Course Revenues $2,677,256 $2,600,600 $2,057,100 $1,656,000 $2,589,400 $2,736,800 $2,921,700 $2,950,800 $2,980,500 $3,010,100 $3,040,400
Concession Payments
Food and Beverage Concession
Variable Portion $55,076 $53,400 $37,600 $28,500 $51,800 $53,900 $57,400 $58,000 $58,600 $59,200 $59,700
Utility Payment $25,920 $25,900 $26,400 $26,400 $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total from F & B Concession $80,996 $79,300 $64,000 $54,900 $78,700 $80,800 $84,800 $85,400 $86,500 $87,100 $88,200
Pro Shop Lease
Merchandise (4%)$26,536 $25,700 $18,100 $13,700 $25,000 $25,700 $27,700 $27,700 $28,200 $28,200 $28,800
Total From Pro Shop Concession $26,536 $25,700 $18,100 $13,700 $25,000 $25,700 $27,700 $27,700 $28,200 $28,200 $28,800
Total Gross to City $2,784,788 $2,705,600 $2,139,200 $1,724,600 $2,693,100 $2,843,300 $3,034,200 $3,063,900 $3,095,200 $3,125,400 $3,157,400
Operating Expenses
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Salaries & Benefits $259,455 $139,000 $145,300 $151,800 $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Range Fees 130,152 126,700 89,300 67,600 123,000 127,900 136,200 137,600 139,000 140,400 141,800
Cart Fees 117,529 117,400 82,800 62,600 114,000 118,600 126,200 127,500 128,800 130,100 131,400
Club Fees 5,576 5,700 4,600 4,000 5,700 5,800 5,900 6,000 6,100 6,200 6,300
Fixed Lozares Management Fee 345,333 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300
Merchant Fees Reimbursement 36,211 36,400 28,800 23,200 36,300 38,300 40,900 41,300 41,700 42,100 42,600
Contract Maintenance 475,000 750,000 675,000 625,000 800,000 812,000 824,200 836,600 849,100 861,800 874,700
Repairs & maintenance 21,943 22,300 17,800 15,600 22,300 22,600 22,900 23,200 23,500 23,900 24,300
Advertising & Publish 10,765 10,900 9,300 45,000 30,000 17,000 17,300 17,600 17,900 18,200 18,500
Supplies and Materials 44,417 45,100 36,100 31,600 45,100 45,800 46,500 47,200 47,900 48,600 49,300
Water Expense 361,870 246,000 277,400 207,000 195,000 200,900 204,900 214,100 223,700 233,800 244,300
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 28
Palo Alto Golf Course Revenue / Expense - Option A
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Other Direct Charges (Incl. Electric) 45,263 45,900 36,700 32,100 44,700 45,400 46,100 46,800 47,500 48,200 48,900
Indirect Charges 102,571 104,100 83,300 72,900 104,100 105,700 107,300 108,900 110,500 112,200 113,900
Total City Operating Expenses $1,956,085 $1,994,800 $1,831,700 $1,683,700 $2,024,100 $2,051,000 $2,096,900 $2,133,100 $2,170,100 $2,208,400 $2,247,800
Net Income From Operations (Loss)$828,703 $740,700 $333,200 $66,600 $694,700 $818,100 $963,200 $956,700 $951,000 $917,000 $909,600
Non-operating
Income from Sale of Property 35,230
D/S Income $0 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non-operating $35,230 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non-operating)$863,933 $656,200 $299,900 $30,700 $651,700 $770,300 $908,200 $899,200 $890,900 $854,200 $844,000
Debt Service $559,539 $499,000 $428,200 $429,000 $428,200 $430,800 $432,200 $432,300 $431,200 $0 $0
Payment to General Fund $94,849 $94,800 $0 $0 $107,600 $107,600 $107,600 $107,600 $107,600 $0 $0
New Debt Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Additional Capital $0 $0 $0 $0 $0 $0 $0 $0 $0 $750,000 $0
Reserve for Replacement $0 $0 $0 $0 $196,800 $209,000 $223,300 $225,500 $227,800 $230,100 $232,400
Cost Plan Charges $41,455 $42,700 $44,000 $45,300 $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $695,843 $636,500 $472,200 $474,300 $779,300 $795,500 $812,600 $816,400 $819,100 $1,034,200 $288,100
Net Income or (Loss)$168,090 $104,200 ($139,000)($407,700)($84,600)$22,600 $150,600 $140,300 $131,900 ($117,200)$621,500
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 29
PROJECTIONS BASED ON “OPTION D”
The NGF cash flow model for operation under “Option D” assumes a more significant upgrade
to the facility with a “more dramatic transformation” as described by the golf course architect.
The NGF revenue estimate has been combined with the present operating structure to provide a
full estimate of Baylands GC performance for the next 10 years, assuming successful
completion of the “Option D” upgrades. The NGF has projected growth to over $3.0 million in
total gross revenue (from all sources) to the City by 2016.
Key Assumptions
The Base assumptions in preparing the projected financial performance match those presented
in the projection for Option A,except the following changes noted below:
Rounds Performance
The rounds activity performance assumptions include:
Rounds in FY2013 assume ‘as-is’ operation on 18 holes for the first 9 months, then
operation on only 9 holes for the last 3 months. During the last three months a
reduction of 50% off historical rounds for the corresponding month is assumed. All
rounds from April-June 2013 are assumed to be 9-hole rounds.
Rounds in FY2014 assume operation on 9 holes for the first 7 months, then
operation with an upgraded 18 holes for February - June 2014. All rounds from July
2013 through January 2014 are assumed to be 9-hole rounds with a reduction of
50% off historical totals for the corresponding months.
Rounds in FY2015 through FY2021 assume increases to a stabilized level of 73,300
by 2017.
The overall distribution of rounds by category is shown in the table below:
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 30
Palo Alto Municipal Golf Course (Baylands GC)
Projected Activity for Option D (2012-2021)
As-Is
9-Mos. 18-
H /3 Mos.
9-H
5-Mos. 18-
H /7 Mos.
9-H
Operate on 18-holes with upgraded
golf design and more appealing
features
FY2012 FY2013 FY2014 FY2015 FY2016
FY2017
-2021
Weekday
18-Hole 5,400 3,500 1,800 5,500 5,800 6,100
Senior Non-Resident 6,300 4,200 2,100 6,200 6,550 6,900
9-Hole 1,500 6,400 11,000 1,600 1,600 1,700
Senior 900 600 300 1,100 1,150 1,200
Junior 1,400 1,000 400 1,350 1,400 1,500
Early Bird 700 500 200 800 850 900
Twilight 11,300 7,800 3,700 11,200 11,750 12,400
Specials 7,500 5,400 3,000 7,550 8,000 8,400
Junior Card 1,100 800 400 1,150 1,250 1,300
Senior Card 800 600 300 1,000 1,050 1,100
Non-Resident Senior Card 4,000 2,600 1,200 3,950 4,200 4,400
Sub-Total Weekday 40,900 33,400 24,400 41,400 43,600 45,900
Weekend
18-Hole 10,200 7,000 3,500 9,900 10,450 11,000
9 Hole 1,900 8,700 11,900 2,000 2,150 2,200
Junior 800 600 300 900 950 1,000
Twilight 6,200 4,100 2,100 6,000 6,350 6,700
Sub-Total Weekend 19,100 20,400 17,800 18,800 19,900 20,900
Complimentary Play 2,500 1,700 1,000 2,500 2,500 2,500
Tournaments 2,200 1,500 800 3,000 3,500 4,000
TOTAL ROUNDS 64,700 57,000 44,000 65,700 69,500 73,300
Average Fees / Revenue
The average green fees per round by category are shown in the table that follows. Key
assumptions driving this estimate include:
The only adjustment in FY2013 is for the 9-hole rate, which has been adjusted
downward to reflect the various forms of discounting expected to be present when
the facility is operating on only 9 holes in the final 3 months of FY2013 and the first 7
months of FY2014.
Upon re-opening on 18 holes (assumed January 1, 2014), average fees in each
category are increased approximately 10% over FY2012 (rounded).
Average Cart fee and driving range revenue per round in FY2012 is based on the
actuals in FY2011. For FY2013, average cart / range revenue per round is reduced
by 20% (from 2011) to reflect the operation on only 9 holes the last 3 months. For
FY2014, average cart and range revenue is reduced by 30% (from FY2011) to reflect
7 months on 9 holes. By FY2015, average cart and range revenue is restored at the
2011 level and then increased by 1% per year through 2021.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 31
Average merchandise sales in FY2012 are based on the actual in FY2011. Average
sales are reduced by 20% (from 2011) in FY2013 to reflect 9 holes-only the last 3
months, and 30% in FY2014 to reflect 7 months on 9 holes. By FY2015, average
sales are restored to the 2011 level with 1% increases through 2021.
Average food and bar sales in FY2012 are based on the actual in FY2011. Average
sales are reduced by 20% (from 2011) in FY2013 to reflect 9 holes-only the last 3
months, and 30% in FY2014 to reflect 7 months on 9 holes. By FY2015, average
sales are restored to the 2011 level with 1% increases through 2021.
The average green fees by category and ancillary revenue per round are shown in
the table below (assume 1% annual increases for FY2018-2021 as noted):
Palo Alto Municipal Golf Course (Baylands GC)
Projected Average Green Fees for Option D (2012-2021)
As-Is
9-Mos.
18-H /3
Mos. 9-H
5-Mos.
18-H /7
Mos. 9-H
Operate on 18-holes with
upgraded golf design and more
appealing features
FY2012 FY2013 FY2014 FY2015 FY2016 FY2017
Weekday
18-Hole $37.00 $37.00 $41.00 $41.41 $41.82 $42.24
Senior Non-Resident $32.00 $32.00 $35.00 $35.35 $35.70 $36.06
9-Hole $23.00 $18.00 $17.00 $25.00 $25.25 $25.50
Senior $28.00 $28.00 $31.00 $31.31 $31.62 $31.94
Junior $14.75 $14.75 $16.25 $16.41 $16.58 $16.74
Early Bird $23.00 $23.00 $25.50 $25.76 $26.01 $26.27
Twilight $30.00 $30.00 $33.00 $33.33 $33.66 $34.00
Specials $19.00 $19.00 $21.00 $21.21 $21.42 $21.64
Junior Card $19.70 $19.70 $21.75 $21.97 $22.19 $22.41
Senior Card $23.50 $23.50 $26.00 $26.26 $26.52 $26.79
Non-Resident Senior Card $27.50 $27.50 $30.00 $30.30 $30.60 $30.91
Weekend
18-Hole $47.00 $47.00 $52.00 $52.52 $53.05 $53.58
9 Hole $27.00 $24.75 $27.25 $28.75 $29.04 $29.33
Junior $15.80 $15.80 $17.50 $17.68 $17.85 $18.03
Twilight $34.00 $34.00 $37.50 $37.88 $38.25 $38.64
Tournaments $34.60 $34.60 $38.00 $38.38 $38.76 $39.15
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 32
Expense Assumptions
Contract maintenance expense to the City of Palo Alto assumes:
$62,500 per month for FY2012.
$62,500 per month for the first 9 months, then $37,500 per months for the
last 3 months of FY2013.
$37,500 per month for the first 7 months, then $71,000 per months for the
last 5 months of FY2014.
$71,000 per month in FY2015, growing at 1.5% annually through 2021.
Other expenses such as repairs, maintenance, supplies, club fees, materials and
other indirect expenses are all based on actual figures for FY2011 with 20%
reduction in FY2013 and 30% reduction in FY2014, returning to FY2011 levels in
FY2015 plus 1.5% increases assumed through FY2021.
Water expense has been highly variable and NGF projections are based on the 4-
year average (2008-2011), with assumptions of reductions in use as described
previously:
25% reduction during construction
32% reduction upon re-opening
Annual increases are assumed at 20% for 2013, 15% for 2014, 9% for 2015,
3% for 2016, 2% for 2017 and 4.5% for FY2018 through FY2021.
Other direct charges (including electric) are based on actual 2011 totals, based on
actual figures for FY2011 with 20% reduction in FY2013 and 30% reduction in
FY2014. A slight reduction expected upon re-opening the golf course in FY2015 (as
described by the architect). Annual increase of 1.5% is assumed from FY2015
through FY2021.
Debt Service and Other Non-Operating Expense Assumptions
There is a new payment of ± $223,700 to the General Fund from FY2015 – FY2019
for repayment of a loan for the difference between the estimated capital cost for
Option D and the expected reimbursement from the SFCJPA.
Option D also assumes that the full irrigation replacement will be completed in
FY2020 (or by 2020) at a cost of $500,000 (real 2012 dollars).
Pro Forma Estimate for ‘Option D’ Scenario – FY2012 – FY2021
Utilizing the above assumptions and activity/revenue estimates, NGF Consulting has prepared a
pro forma for the next five years of operation, including FY2012 (already underway). The table
shows that with a more comprehensive renovation, the Baylands GC could produce net income
to the City in the range of $930,000 to $1.27 million (before debt, cost plan and reserve) through
the term of the current debt program. After the City is no longer responsible for debt payments
(beginning in FY2020), the facility is expected to produce net income to the City in the range of
$915,000 per year, although there is a one-time expense of $500,000 for irrigation in 2020.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 33
Palo Alto Golf Course Revenue / Expense - Option D
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Golf Course Revenues
Green Fees (Incl. Cards)$2,016,537 $1,960,100 $1,605,200 $1,213,500 $2,204,500 $2,361,900 $2,522,200 $2,547,500 $2,572,900 $2,598,700 $2,624,600
Cart Fees 302,799 293,500 206,900 139,700 298,100 318,500 339,200 342,600 346,100 349,500 353,000
Driving Range 343,911 333,400 235,000 158,700 338,600 361,700 385,300 389,200 393,100 397,000 401,000
Tournament / League Fees 2,196 2,100 1,900 1,400 2,200 2,300 2,400 2,400 2,400 2,400 2,400
Other 11,813 11,500 8,100 5,500 11,600 12,300 13,200 13,200 13,500 13,500 13,800
Total Golf Course Revenues $2,677,256 $2,600,600 $2,057,100 $1,518,800 $2,855,000 $3,056,700 $3,262,300 $3,294,900 $3,328,000 $3,361,100 $3,394,800
Concession Payments
Food and Beverage Concession
Variable Portion $55,076 $53,400 $37,600 $25,400 $54,200 $57,900 $61,700 $62,300 $62,900 $63,600 $64,200
Utility Payment $25,920 $25,900 $26,400 $26,400 $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total from F & B Concession $80,996 $79,300 $64,000 $51,800 $81,100 $84,800 $89,100 $89,700 $90,800 $91,500 $92,700
Pro Shop Lease
Merchandise (4%)$26,536 $25,700 $18,100 $12,200 $26,100 $27,600 $29,700 $29,700 $30,300 $30,300 $30,900
Total From Pro Shop Concession $26,536 $25,700 $18,100 $12,200 $26,100 $27,600 $29,700 $29,700 $30,300 $30,300 $30,900
Total Gross to City $2,784,788 $2,705,600 $2,139,200 $1,582,800 $2,962,200 $3,169,100 $3,381,100 $3,414,300 $3,449,100 $3,482,900 $3,518,400
Operating Expenses
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Salaries & Benefits $259,455 $139,000 $145,300 $151,800 $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Range Fees 130,152 126,700 89,300 60,300 128,700 137,400 146,400 147,900 149,400 150,900 152,400
Cart Fees 117,529 117,400 82,800 55,900 119,200 127,400 135,700 137,000 138,400 139,800 141,200
Club Fees 5,576 5,700 4,600 4,000 5,700 5,800 5,900 6,000 6,100 6,200 6,300
Fixed Lozares Management Fee 345,333 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300
Merchant Fees Reimbursement 36,211 36,400 28,800 21,300 40,000 42,800 45,700 46,100 46,600 47,100 47,500
Contract Maintenance 475,000 750,000 675,000 595,800 852,000 864,800 877,800 891,000 904,400 918,000 931,800
Repairs & maintenance 21,943 22,300 17,800 15,600 22,300 22,600 22,900 23,200 23,500 23,900 24,300
Advertising & Publish 10,765 10,900 9,300 45,000 30,000 17,000 17,300 17,600 17,900 18,200 18,500
Supplies and Materials 44,417 45,100 36,100 31,600 45,100 45,800 46,500 47,200 47,900 48,600 49,300
Water Expense 361,870 246,000 277,400 204,000 161,000 165,800 169,100 176,700 184,700 193,000 201,700
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 34
Palo Alto Golf Course Revenue / Expense - Option D
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Other Direct Charges (Incl. Electric)45,263 45,900 36,700 32,100 43,500 44,200 44,900 45,600 46,300 47,000 47,700
Indirect Charges 102,571 104,100 83,300 72,900 104,100 105,700 107,300 108,900 110,500 112,200 113,900
Total City Operating Expenses $1,956,085 $1,994,800 $1,831,700 $1,635,600 $2,055,500 $2,090,300 $2,138,000 $2,173,500 $2,210,100 $2,247,800 $2,286,400
Net Income From Operations (Loss)$828,703 $710,800 $307,500 ($52,800)$906,700 $1,078,800 $1,243,100 $1,240,800 $1,239,000 $1,235,100 $1,232,000
Non-operating
Income from Sale of Property 35,230
D/S Income $0 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non-operating $35,230 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non-operating)$863,933 $740,700 $333,200 ($27,100)$932,400 $1,104,600 $1,268,500 $1,266,700 $1,264,900 $1,235,100 $1,232,000
Debt Service $559,539 $499,000 $428,200 $429,000 $428,200 $430,800 $423,200 $432,300 $431,200 $0 $0
Payment to General Fund $94,849 $94,800 $0 $0 $223,700 $223,700 $223,700 $223,700 $223,700 $0 $0
Additional Capital $0 $0 $0 $0 $0 $0 $0 $0 $0 $500,000 $0
Reserve for Replacement $0 $0 $0 $0 $220,500 $236,200 $252,200 $254,800 $257,300 $259,900 $262,500
Cost Plan Charges $41,455 $42,700 $44,000 $45,300 $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $695,843 $636,500 $472,200 $474,300 $919,100 $938,800 $948,600 $961,800 $964,700 $814,000 $318,200
Net Income or (Loss)$168,090 $104,200 ($139,000)($501,400)$13,300 $165,800 $319,900 $304,900 $300,200 $421,100 $913,800
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 35
PROJECTIONS BASED ON “OPTION F”
The NGF cash flow model for operation under “Option F” assumes a more significant upgrade to
the facility, with a two-thirds complete renovation the addition of a soccer field and a comparable
“dramatic transformation” as proposed in Option D. The NGF estimate shows the Baylands GC
revenue performance under Option F over the next 10 years would be comparable to Option D.
Key Assumptions
The Base assumptions in preparing the projected financial performance match those presented
in the projection for Option D,except the following changes noted below:
Rounds and Average Fee Performance
The rounds activity and average fee performance assumptions are the same as proposed in
“Option D,” except:
Rounds in FY2014 assume operation on 9 holes for the first 9 months, then
operation with an upgraded 18 holes for April - June 2014. All rounds from July 2013
through March 2014 are assumed to be 9-hole rounds with totals reduced by 50% for
each corresponding month.
Palo Alto Municipal Golf Course (Baylands GC)
Projected Activity for Option F (2012-2021)
As-Is
9-Mos. 18-
H /3 Mos.
9-H
3-Mos. 18-
H /9 Mos.
9-H
Operate on 18-holes with nearly
complete renovation
FY2012 FY2013 FY2014 FY2015 FY2016
FY2017
-2021
Weekday
18-Hole 5,400 3,500 1,000 5,500 5,800 6,100
Senior Non-Resident 6,300 4,200 1,100 6,200 6,550 6,900
9-Hole 1,500 6,400 12,800 1,600 1,600 1,700
Senior 900 600 200 1,100 1,150 1,200
Junior 1,400 1,000 300 1,350 1,400 1,500
Early Bird 700 500 200 800 850 900
Twilight 11,300 7,800 2,000 11,200 11,750 12,400
Specials 7,500 5,400 2,200 7,550 8,000 8,400
Junior Card 1,100 800 300 1,150 1,250 1,300
Senior Card 800 600 200 1,000 1,050 1,100
Non-Resident Senior Card 4,000 2,600 800 3,950 4,200 4,400
Sub-Total Weekday 40,900 33,400 21,100 41,400 43,600 45,900
Weekend
18-Hole 10,200 7,000 2,100 9,900 10,450 11,000
9 Hole 1,900 8,700 13,700 2,000 2,150 2,200
Junior 800 600 200 900 950 1,000
Twilight 6,200 4,100 1,000 6,000 6,350 6,700
Sub-Total Weekend 19,100 20,400 17,000 18,800 19,900 20,900
Complimentary Play 2,500 1,700 1,100 2,500 2,500 2,500
Tournaments 2,200 1,500 500 3,000 3,500 4,000
TOTAL ROUNDS 64,700 57,000 39,700 65,700 69,500 73,300
Average green and ancillary fees in “Option F” are identical to those presented for
“Option D.”
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 36
Expense Assumptions
Contract maintenance expense to the City of Palo Alto assumes:
$62,500 per month for FY2012
$62,500 per month for the first 9 months, then $37,500 per months for the
last 3 months of FY2013
$37,500 per month for the first 9 months, then $66,667 per months for the
last 3 months of FY2014
$66,667 per month in FY2015, growing at 1.5% annually through 2021.
Other expenses such as repairs, maintenance, supplies, club fees, materials and
other indirect expenses are all based on actual figures for FY2011 with 20%
reduction in FY2013 and 40% reduction in FY2014, returning to FY2011 levels in
FY2015 plus 1.5% increases assumed through FY2021.
Water expense has been highly variable and NGF projections are based on the 4-
year average (2008-2011), with assumptions of reductions in use as described
previously:
20% reduction during construction
32% reduction upon re-opening
Annual increases are assumed at 20% for 2013, 15% for 2014, 9% for 2015,
3% for 2016, 2% for 2017 and 4.5% for FY2018 through FY2021
Other direct charges (including electric) are based on actual 2011 totals, based on
actual figures for FY2011 with 20% reduction in FY2013 and 40% reduction in
FY2014. A slight reduction expected upon re-opening the golf course in FY2015 (as
described by the architect). Annual increase of 1.5% is assumed from FY2015
through FY2021.
Debt Service and Other Non-Operating Expense Assumptions
The NGF has assumed that the $2,855,400 in additional cost needed to complete
Option F, over and above the amount estimated to be reimbursed by the SFCJPA,
will be funded via the issuance of a new debt program (revenue or General
Obligation Bond), with terms of 4.5% interest for 20 years, with payments beginning
in FY2015.
Option F also assumes that the full irrigation replacement will be completed in
FY2020 (or by 2020) at a cost of $250,000 (real 2012 dollars).
Pro Forma Estimate for ‘Option F’ Scenario – FY2012 – FY2021
Based on the inputs described above, the pro forma estimate for future performance under
“Option F” shows that with this more comprehensive renovation, the Baylands GC could
produce net income to the City in the range of $960,000 to $1.34 million (before existing and
new debt, cost plan and reserve) through the term of the current debt program. After the City is
no longer responsible for its older (1999 issue) debt payments, beginning in FY2020, the facility
is expected to produce net income to the City in the range of $720,000 per year, although there
is a one-time expense of $250,000 for irrigation in 2020.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 37
Palo Alto Golf Course Revenue / Expense - Option F
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Golf Course Revenues
Green Fees (Incl. Cards)$2,016,537 $1,960,100 $1,605,200 $969,500 $2,204,500 $2,361,900 $2,522,200 $2,547,500 $2,572,900 $2,598,700 $2,624,600
Cart Fees 302,799 293,500 206,900 126,100 298,100 318,500 339,200 342,600 346,100 349,500 353,000
Driving Range 343,911 333,400 235,000 143,200 338,600 361,700 385,300 389,200 393,100 397,000 401,000
Tournament / League Fees 2,196 2,100 1,900 1,300 2,200 2,300 2,400 2,400 2,400 2,400 2,400
Other 11,813 11,500 8,100 4,900 11,600 12,300 13,200 13,200 13,500 13,500 13,800
Total Golf Course Revenues $2,677,256 $2,600,600 $2,057,100 $1,245,000 $2,855,000 $3,056,700 $3,262,300 $3,294,900 $3,328,000 $3,361,100 $3,394,800
Concession Payments
Food and Beverage Concession
Variable Portion $55,076 $53,400 $37,600 $22,900 $54,200 $57,900 $61,700 $62,300 $62,900 $63,600 $64,200
Utility Payment $25,920 $25,900 $26,400 $26,400 $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total from F & B Concession $80,996 $79,300 $64,000 $49,300 $81,100 $84,800 $89,100 $89,700 $90,800 $91,500 $92,700
Pro Shop Lease
Merchandise (4%)$26,536 $25,700 $19,300 $15,400 $28,100 $28,900 $29,700 $29,700 $30,300 $30,300 $30,900
Total From Pro Shop Concession $26,536 $25,700 $19,300 $15,400 $28,100 $28,900 $29,700 $29,700 $30,300 $30,300 $30,900
Total Gross to City $2,784,788 $2,705,600 $2,139,200 $1,305,300 $2,962,200 $3,169,100 $3,381,100 $3,414,300 $3,449,100 $3,482,900 $3,518,400
Operating Expenses
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Salaries & Benefits $259,455 $139,000 $145,300 $151,800 $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Range Fees 130,152 126,700 89,300 54,400 128,700 137,400 146,400 147,900 149,400 150,900 152,400
Cart Fees 117,529 117,400 82,800 50,400 119,200 127,400 135,700 137,000 138,400 139,800 141,200
Club Fees 5,576 5,700 4,600 3,400 5,700 5,800 5,900 6,000 6,100 6,200 6,300
Fixed Lozares Management Fee 345,333 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300
Merchant Fees Reimbursement 36,211 36,400 28,800 17,400 40,000 42,800 45,700 46,100 46,600 47,100 47,500
Contract Maintenance 475,000 750,000 675,000 537,500 800,000 812,000 824,200 836,600 849,100 861,800 874,700
Repairs & maintenance 21,943 22,300 17,800 13,400 22,300 22,600 22,900 23,200 23,500 23,900 24,300
Advertising & Publish 10,765 10,900 9,300 45,000 30,000 17,000 17,300 17,600 17,900 18,200 18,500
Supplies and Materials 44,417 45,100 36,100 21,700 45,100 45,800 46,500 47,200 47,900 48,600 49,300
Water Expense 361,870 246,000 280,400 217,600 182,400 187,900 191,700 200,300 209,300 218,700 228,500
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 38
Palo Alto Golf Course Revenue / Expense - Option F
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Other Direct Charges (Incl. Electric) 45,263 45,900 36,700 22,000 42,500 43,100 43,700 44,400 45,100 45,800 46,500
Indirect Charges 102,571 104,100 83,300 50,000 104,100 105,700 107,300 108,900 110,500 112,200 113,900
Total City Operating Expenses $1,956,085 $1,994,800 $1,834,700 $1,529,900 $2,023,900 $2,058,500 $2,105,800 $2,141,500 $2,178,200 $2,216,100 $2,254,900
Net Income From Operations (Loss)$828,703 $710,800 $304,500 ($224,600)$938,300 $1,110,600 $1,275,300 $1,272,800 $1,270,900 $1,266,800 $1,263,500
Non-operating
Income from Sale of Property 35,230
D/S Income $0 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non-operating $35,230 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non-operating)$863,933 $740,700 $330,200 ($198,900)$964,000 $1,136,400 $1,300,700 $1,298,700 $1,296,800 $1,266,800 $1,263,500
Debt Service $559,539 $499,000 $428,200 $429,000 $428,200 $430,800 $423,200 $432,300 $431,200 $0 $0
Payment to General Fund $94,849 $94,800 $0 $0 $0 $0 $0 $0 $0 $0 $0
Additional Capital $0 $0 $0 $0 $0 $0 $0 $0 $0 $250,000 $0
New Debt Service $0 $0 $0 $0 $219,500 $219,500 $219,500 $219,500 $219,500 $219,500 $219,500
Reserve for Replacement $0 $0 $0 $0 $220,500 $236,200 $252,200 $254,800 $257,300 $259,900 $262,500
Cost Plan Charges $41,455 $42,700 $44,000 $45,300 $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $695,843 $636,500 $472,200 $474,300 $914,900 $934,600 $944,400 $957,600 $960,500 $783,500 $537,700
Net Income or (Loss)$168,090 $104,200 ($142,000)($673,200)$49,100 $201,800 $356,300 $341,100 $336,300 $483,300 $725,800
NOTE: Option F would likely include additional revenue from soccer fields of approximately $78,000 per field per year.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 39
PROJECTIONS BASED ON “OPTION G”
The NGF projection model for “Option G” represents a significant change from other options
presented. This option would involve a complete renovation of the Palo Alto Municipal Golf
Course (to be re-branded as “Baylands Golf Club). The project would involve a full closure of
the golf course from April 2013 through March 2014, re-opening as a brand new golf course with
the highest quality golf features commanding higher fees than any other option presented. The
full golf course irrigation system would be replaced and three new soccer fields would be added
to the site. Subsequent to the initial draft report, the City Finance Committee recommended that
this option include rebuilding of all 18 greens, re-turfing of all fairways, construction of an on-
course restroom, and rebuilding the practice green area. These changes should further enhance
the product’s marketability and the golfer experience.
The NGF revenue estimate has been combined with the present operating structure to provide a
full estimate of Baylands GC performance for the next 10 years, assuming successful
completion of the proposed “Option G” upgrades. The NGF has projected growth to almost $3.2
million in total gross revenues (from all sources) to the City by 2016.
Key Assumptions
The Base assumptions in preparing the projected financial performance estimates covers
several categories, including rounds activity, green fees, average revenues (carts, range,
concessions, etc.), total revenue, expenses, capital and debt.
Rounds Performance
The rounds activity performance assumptions include:
Rounds in FY2012 assume a 3% reduction from FY2011 total rounds based on
actual performance in the first 6 months of FY2012.
Rounds in FY2013 assume ‘as-is’ operation on 18 holes for the first 9 months. The
golf course then closes entirely for the next 12 months (April 2013 –March 2014), re-
opening as an upgraded new facility on April 1, 2014.
Upon re-opening, rounds are assumed to grow to 67,900 in FY2015, stabilizing at
75,700 rounds by 2017.
The overall distribution of rounds by category is shown in the table below:
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 40
Palo Alto Municipal Golf Course (Baylands GC)
Projected Activity for Option G (2012-2021)
As-Is
9-Mos. 18-
H / 3 Mos.
closed
3-Mos. 18-
H / 9 Mos.
Closed
Operate on 18-holes with maximum
renovation and upgrade
FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 -2021
Weekday
18-Hole 5,400 4,000 1,000 5,500 5,800 6,100
Senior Non-Resident 6,300 4,700 1,300 6,200 6,550 6,900
9-Hole 1,500 1,100 400 1,550 1,600 1,700
Senior 900 600 250 1,100 1,150 1,200
Junior 1,400 1,000 400 1,450 1,500 1,600
Early Bird 700 500 200 800 850 900
Twilight 11,300 8,400 2,800 11,500 12,150 12,800
Specials 7,500 5,600 2,200 7,650 8,050 8,500
Junior Card 1,100 800 300 1,150 1,250 1,300
Senior Card 800 600 200 1,000 1,050 1,100
Non-Resident Senior Card 4,000 3,000 1,000 4,000 4,300 4,500
Sub-Total Weekday 40,900 30,300 10,050 41,900 44,250 46,600
Weekend
18-Hole 10,200 7,600 2,500 10,050 10,650 11,200
9 Hole 1,900 1,400 500 2,000 2,100 2,200
Junior 800 600 200 900 950 1,000
Twilight 6,200 4,600 1,500 6,050 6,350 6,700
Sub-Total Weekend 19,100 14,200 4,700 19,000 20,050 21,100
Complimentary Play 2,500 1,800 650 3,500 3,500 3,500
Tournaments 2,200 1,600 600 3,500 4,000 4,500
TOTAL ROUNDS 64,700 47,900 16,000 67,900 71,800 75,700
Average Fees / Revenue
The average green fees per round by category are shown in the table that follows. Key
assumptions driving this estimate include:
There is no change in average fees for FY2012 over FY2011.
Upon re-opening on 18 holes (assumed April 1, 2014), average fees in each
category are increased approximately 15% over FY2012 (rounded).
For FY2015 through FY2021, NGF has assumed 1% annual increases in all fee
categories.
All other ancillary revenue centers mirror estimates made in Options D and F.
The average green fees by category and ancillary revenue per round are shown in
the table below (assume 1% annual increases for FY2018-2021 as noted):
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 41
Palo Alto Municipal Golf Course (Baylands GC)
Projected Average Green Fees for Option G (2012-2021)
As-Is
9-Mos. 18-
H / 3 Mos.
closed
3-Mos. 18-
H / 9 Mos.
Closed
Operate on 18-holes with
maximum renovation and
upgrade
FY2012 FY2013 FY2014 FY2015 FY2016 FY2017
Weekday
18-Hole $37.00 $37.00 $42.50 $42.93 $43.35 $43.79
Senior Non-Resident $32.00 $32.00 $37.00 $37.37 $37.74 $38.12
9-Hole $23.00 $18.00 $24.00 $25.00 $25.25 $25.50
Senior $28.00 $28.00 $32.00 $32.32 $32.64 $32.97
Junior $14.75 $14.75 $17.00 $17.17 $17.34 $17.52
Early Bird $23.00 $23.00 $26.50 $26.77 $27.03 $27.30
Twilight $30.00 $30.00 $34.50 $34.85 $35.19 $35.55
Specials $19.00 $19.00 $22.00 $22.22 $22.44 $22.67
Junior Card $19.70 $19.70 $22.50 $22.73 $22.95 $23.18
Senior Card $23.50 $23.50 $27.00 $27.27 $27.54 $27.82
Non-Resident Senior Card $27.50 $27.50 $31.50 $31.82 $32.13 $32.45
Weekend
18-Hole $47.00 $47.00 $54.00 $54.54 $55.09 $55.64
9 Hole $27.00 $24.75 $28.50 $28.75 $29.04 $29.33
Junior $15.80 $15.80 $18.00 $18.18 $18.36 $18.55
Twilight $34.00 $34.00 $39.00 $39.39 $39.78 $40.18
Tournaments $34.60 $34.60 $40.00 $40.40 $40.80 $41.21
Other Revenue Assumptions
Total green fee revenue includes all discount (10-play) cards and monthly passes.
Ancillary revenue per round (carts, merchandise, range, food, bar, other) is derived
from total rounds, including complimentary rounds.
Concession revenue to the City of Palo Alto assumes the same current contract
basics through FY2021,with no minimums after April 2013. The City is assumed
to collect: (1) 7% of all food and beverage revenue; and (2) 4% of merchandise
sales.
Expense Assumptions
Labor expenses are for City oversight only. These include allocations for contract
oversight, Parks and Recreation Director, Division manager, etc. The estimate is
intended to include both salary and benefits allocation and is increased by 4.5% per
year through FY2021.
Commissions paid to the pro shop vendor include 38% of driving range gross
revenue and 40% of gross cart revenue (as per contract).
The pro shop management fee is fixed at $28,775 per month while the golf course is
open. No management fees are assumed for April 2013 through March 2014.
Reimbursements for merchant fees (mostly credit card fees) are assumed to be
1.4% of total facility revenue.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 42
Contract maintenance expense to the City of Palo Alto assumes:
$62,500 per month for FY2012
$62,500 per month for the first 9 months of FY2013
No contract maintenance expense for April 2013 through March 2014
$68,750 per month (fixed) upon re-opening in April 2014 (3 months in
FY2014), then $68,750 per month in FY2015, growing at 1.5% annually
through 2021
Other expenses such as repairs, maintenance, supplies, club fees, materials and
other indirect expenses are all based on actual figures for FY2011 with 20%
reduction in FY2013 and 70% reduction in FY2014, returning to FY2011 levels in
FY2015 plus 1.5% increases assumed through FY2021.
Advertising and publishing expense is reduced by 50% during construction and
operation on 9 holes, totaling 15% reduction in FY2013. Upon re-opening the golf
course this expense is assumed to increase $45,000 to account for enhanced
marketing of the upgraded facility and re-theme as “Baylands GC.” Advertising and
publishing expense is then reduced in subsequent years to a “standard” of around
$17,000 per year.
Water expense has been highly variable and NGF projections are based on the 4-
year average (2008-2011), with assumptions of reductions in use as described
previously:
60% reduction during construction
32% reduction upon re-opening
Annual increases are assumed at 20% for 2013, 15% for 2014, 9% for 2015,
3% for 2016, 2% for 2017 and 4.5% for FY2018 through FY2021
Other direct charges (including electric) are based on actual 2011 totals, based on
actual figures for FY2011 with 20% reduction in FY2013 and 70% reduction in
FY2014. A slight reduction expected upon re-opening the golf course in FY2015 (as
described by the architect). Annual increase of 1.5% is assumed from FY2015
through FY2021.
Debt Service and Other Non-Operating Expense Assumptions
The NGF has assumed that the $4,570,000 in additional cost needed to complete
Option G, over and above the amount reimbursed by the SFCJPA, will be funded via
the issuance of a new debt program (revenue or General Obligation Bond), with
terms of 4.5% interest for 20 years, with payments beginning in FY2015.
Pro Forma Estimate for ‘Option G’ Scenario – FY2012 – FY2021
Based on the inputs described above, the pro forma estimate for future performance under
“Option G” shows that with this complete renovation, the Baylands GC could produce net
income to the City in the range of $1.07 to $1.42 million (before existing and new debt, cost plan
and reserve) through the term of the current debt program that ends in 2019. After the City is no
longer responsible for its older (1999 issue) debt payments, the facility is expected to produce
net income to the City, after all expenses and other charges, in the range of $740,000 per year.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 43
Palo Alto Golf Course Revenue / Expense - Option G
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Golf Course Revenues
Green Fees (Incl. Cards)$2,016,537 $1,960,100 $1,445,100 $544,300 $2,341,500 $2,510,600 $2,680,900 $2,707,800 $2,734,800 $2,762,200 $2,789,800
Cart Fees 302,799 293,500 173,900 72,600 311,100 332,300 353,900 357,400 361,000 364,600 368,200
Driving Range 343,911 333,400 197,500 82,400 353,400 377,400 401,900 405,900 410,000 414,100 418,200
Tournament / League Fees 2,196 2,100 1,600 500 2,200 2,400 2,500 2,500 2,500 2,500 2,500
Other 11,813 11,500 6,800 2,800 12,000 12,700 13,700 13,700 13,900 13,900 14,200
Total Golf Course Revenues $2,677,256 $2,600,600 $1,824,900 $702,600 $3,020,200 $3,235,400 $3,452,900 $3,487,300 $3,522,200 $3,557,300 $3,592,900
Concession Payments
Food and Beverage Concession
Variable Portion $55,076 $53,400 $31,600 $13,200 $56,600 $60,400 $64,400 $65,000 $65,700 $66,300 $67,000
Utility Payment $25,920 $25,900 $26,400 $26,400 $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total from F & B Concession $80,996 $79,300 $58,000 $39,600 $83,500 $87,300 $91,800 $92,400 $93,600 $94,200 $95,500
Pro Shop Lease
Merchandise (4%)$26,536 $25,700 $15,400 $6,600 $28,900 $29,500 $30,700 $30,700 $31,300 $31,300 $31,900
Total From Pro Shop Concession $26,536 $25,700 $15,400 $6,600 $28,900 $29,500 $30,700 $30,700 $31,300 $31,300 $31,900
Total Gross to City $2,784,788 $2,705,600 $1,898,100 $748,600 $3,130,700 $3,351,200 $3,575,400 $3,610,400 $3,647,100 $3,682,800 $3,720,300
Operating Expenses
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Salaries & Benefits $259,455 $139,000 $145,300 $151,800 $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Range Fees 130,152 126,700 75,100 31,300 134,300 143,400 152,700 154,200 155,800 157,400 158,900
Cart Fees 117,529 117,400 69,600 29,000 124,400 132,900 141,600 143,000 144,400 145,800 147,300
Club Fees 5,576 5,700 4,600 1,700 5,700 5,800 5,900 6,000 6,100 6,200 6,300
Fixed Lozares Management Fee 345,333 345,300 259,000 86,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300
Merchant Fees Reimbursement 36,211 36,400 25,500 9,800 42,300 45,300 48,300 48,800 49,300 49,800 50,300
Contract Maintenance 475,000 750,000 562,500 206,300 825,000 837,400 850,000 862,800 875,700 888,800 902,100
Repairs & maintenance 21,943 22,300 17,800 6,700 22,300 22,600 22,900 23,200 23,500 23,900 24,300
Advertising & Publish 10,765 10,900 8,700 45,000 30,000 17,000 17,300 17,600 17,900 18,200 18,500
Supplies and Materials 44,417 45,100 36,100 13,500 45,100 45,800 46,500 47,200 47,900 48,600 49,300
Water Expense 361,870 246,000 250,900 133,000 183,000 188,500 192,300 201,000 210,000 219,500 229,400
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 44
Palo Alto Golf Course Revenue / Expense - Option G
Revenues
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Other Direct Charges (Incl. Electric) 45,263 45,900 36,700 13,800 41,500 42,100 42,700 43,300 43,900 44,600 45,300
Indirect Charges 102,571 104,100 83,300 31,200 104,100 105,700 107,300 108,900 110,500 112,200 113,900
Total City Operating Expenses $1,956,085 $1,994,800 $1,575,100 $759,400 $2,061,600 $2,097,500 $2,146,000 $2,182,300 $2,219,400 $2,257,900 $2,297,400
Net Income From Operations (Loss)$828,703 $710,800 $323,000 ($10,800)$1,069,100 $1,253,700 $1,429,400 $1,428,100 $1,427,700 $1,424,900 $1,422,900
Non-operating
Income from Sale of Property 35,230
D/S Income $0 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non-operating $35,230 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non-operating)$863,933 $740,700 $348,700 $14,900 $1,094,800 $1,279,500 $1,454,800 $1,454,000 $1,453,600 $1,424,900 $1,422,900
Debt Service $559,539 $499,000 $428,200 $429,000 $428,200 $430,800 $423,200 $432,300 $431,200 $0 $0
Payment to General Fund $94,849 $94,800 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Debt Service $0 $0 $0 $0 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300
Operating & Capital Reserve $0 $0 $0 $0 $234,200 $251,100 $268,100 $270,800 $273,500 $276,200 $279,000
Cost Plan Charges $41,455 $42,700 $44,000 $45,300 $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $695,843 $636,500 $472,200 $474,300 $1,060,400 $1,081,300 $1,092,100 $1,105,400 $1,108,500 $681,600 $686,000
Net Income or (Loss)$168,090 $104,200 ($123,500)($459,400)$34,400 $198,200 $362,700 $348,600 $345,100 $743,300 $736,900
NOTE: Option G would likely include additional revenue from soccer fields estimated by City at approximately $78,000 per field per year ($234,000 for 3 fields).
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 45
FINANCIAL PROJECTIONS SUMMARY
Summary of Options
Comparative table for options in 2015 and 2020 are shown below:
Summary in 2015
Summary in FY2015
Modest Upgrade
Option
A
More
significant
upgrade / nicer
features
Option
D
Nearly
complete
renovation
Option
F
Maximum
renovation
Option
G
TOTAL ROUNDS 62,800 65,700 65,700 67,900
ANNUAL ROUNDS REVENUE $1,967,709 $2,204,512 $2,204,512 $2,341,455
AVERAGE GREEN FEE PER ROUND $31.33 $33.55 $33.55 $34.48
Revenues FY2015
Projected
FY2015
Projected
FY2015
Projected
FY2015
Projected
Total Golf Course Revenues $2,589,400 $2,855,000 $2,855,000 $3,020,200
Concessions
Total from F & B Concession $78,700 $81,100 $81,100 $83,500
Total From Pro Shop Concession $25,000 $26,100 $26,100 $27,000
Total Gross to City $2,693,100 $2,962,200 $2,962,200 $3,130,700
Expenses
Water 195,000 161,000 182,400 225,600
Maintenance Contract 800,000 852,000 800,000 825,000
Total to Pro Shop Contract 618,600 633,200 633,200 646,300
All Other Expenses 410,500 409,300 408,300 407,300
Total City Operating Expenses 2,024,100 2,055,500 2,023,900 2,104,200
Net Income From Operations (Loss)$669,000 $906,700 $938,300 $1,026,500
Total Income (Incl. Non-operating)$694,700 $932,400 $964,000 $1,052,200
Total Debt/Other Charges $779,300 $1,501,100 $914,900 $1,016,600
Net Income or (Loss)($84,600)($568,700)$49,100 $35,600
Footnotes Partial irrigation Partial irrigation Potential for
additional
$78,000 Soccer
revenue
Potential for
additional
$234,000
Soccer revenue
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 46
Summary in 2020
Summary in FY2020
Modest Upgrade
Option
A
More
significant
upgrade / nicer
features
Option
D
Nearly
complete
renovation
Option
F
Maximum
renovation
Option
G
TOTAL ROUNDS 68,200 73,300 73,300 75,700
ANNUAL ROUNDS REVENUE $2,300,746 $2,598,658 $2,598,658 $2,762,185
AVERAGE GREEN FEE PER ROUND $33.74 $35.45 $35.45 $36.49
Revenues FY2015
Projected
FY2015
Projected
FY2015
Projected
FY2015
Projected
Total Golf Course Revenues $3,010,100 $3,361,100 $3,361,100 $3,557,300
Concessions
Total from F & B Concession $87,100 $91,500 $91,500 $94,200
Total From Pro Shop Concession $28,200 $30,300 $30,300 $31,300
Total Gross to City $3,125,400 $3,482,900 $3,482,900 $3,682,800
Expenses
Water 233,800 193,000 218,700 219,500
Maintenance Contract 861,800 918,000 861,800 888,800
Total to Pro Shop Contract 657,900 683,100 683,100 698,300
All Other Expenses 454,900 453,700 452,500 451,300
Total City Operating Expenses $2,208,400 $2,247,800 $2,216,100 $2,257,900
Net Income From Operations (Loss)$917,000 $1,235,100 $1,266,800 $1,424,900
Total Income (Incl. Non-operating)$917,000 $1,235,100 $1,266,800 $1,424,900
Total Debt/Other Charges $1,034,200 $814,000 $783,500 $681,600
Net Income or (Loss)($117,200)$421,100 $483,300 $743,300
Footnotes Partial irrigation Partial irrigation Potential for
additional
$78,000 Soccer
revenue
Potential for
additional
$234,000
Soccer revenue
Summary Results
The results of the NGF Consulting financial projections for Palo Alto Golf Course, based on the
various reconfiguration options and the analysis and assumptions presented in this report, show
that the facility will generate, to varying degrees based on the renovation option, improved
rounds and revenue performance compared to the base “as is” scenario. In relation to
estimating lost rounds and revenues during construction, NGF has assumed for all options
under which the facility will remain open for 9-hole play that the City will still be able to provide a
quality golf experience that is minimally disruptive to the golfer.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 47
Key observations regarding projected “Baylands Golf Club at Palo Alto” financial performance:
NGF has estimated that total revenues to the City will decrease by varying amounts
during construction for the four options evaluated. For instance, under Option A, the
total two-year cumulative reduction in gross revenue to the City is nearly $1.5 million.
This is based on estimated FY 2012 gross revenues. However, because of expense
reductions (e.g., range and cart payments, contract maintenance, water, indirect
charges) during the time of construction, net income from operations (before debt,
other costs) is estimated to decrease by ±$1.08 million over the two-year period,
based on actual estimated FY 2012 net operating income.
Option G, which involves a 12-month closure of all 18 holes, naturally results in the
greatest reduction in revenue, with only $748,600 gross income from operations in
FY 2014, when the course is closed for 9 months. The two-year cumulative loss in
gross revenue to the City, using FY 2012 as a base, is estimated at nearly $2.7
million, while the loss in net income is estimate at ± $1.1 million.
Rounds played, after years of decline, are projected to rebound under all of the
reconfiguration options, with options D and F at stabilized total rounds at 73,300,
representing a 5,100 round improvement over Option A. Option G – full renovation –
results in the highest stabilized activity level, at nearly 76,000 annual rounds.
Option D, which is expected to cost ±$600,000 more than base Option A, is
projected to produce significantly higher net operating income than Option A,
resulting in a quick pay back of the investment.
Stabilized Net Operating Income (before debt and other costs such as capital,
reserve, and cost plan) is projected to be highest under Option G, with 2021 NOI
projected at about $1.42 million. Option F is second with ±$1.26 million, followed
closely by Option D at about $1.23 million.
After additional debt associated with improvements is considered, Option G is
projected to produce overall Net Income to the City that is moderately lower than that
of Option D. However, further down the road when the debt for Option G is paid off, it
is expected to produce the highest Net Income for the City of Palo Alto.
Justifications for Revenue Projections
NGF is confident, given the inputs (e.g., expected quality and appeal following improvements)
for each option, that the rounds, fees, revenues, and expenses projected under each scenario
are reasonable and achievable. The highest stabilized rounds activity we have projected under
any scenario was less than 76,000 total rounds, a level that was achieved as recently as 2007-
08 (and was far exceeded in the past) with a product that was inferior to what a reconfigured
and re-branded golf course will bring to market. Also, we feel we have been conservative in
terms of the fee increases that the improved facility will be able to sustain. Likewise, we believe
it is more difficult to estimate the impact on revenues during the time of construction, as there
are many variables, not the least of which are golfer behavior and preferences.
Pro formas are, by their nature, models based on a set of assumptions that may or may not
become reality and which are subject to a number of uncontrollable factors (e.g., weather
variations, the economy, quality/quantity of the competition), but NGF believes that our
projections represent a “reasonable” estimate of performance for the “Baylands” facility based
on the factors discussed in this report. Among the factors considered when crafting our
projections for each model are:
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 48
Expected higher quality of the Palo Alto Municipal Golf Course (level of improvement
depends on intensity of Reconfiguration Option chosen, level of “additional” work).
Re-branding and effective marketing of the “Baylands Golf Club at Palo Alto”, along
with more proactive direct selling of larger tournaments and events.
Reinventing the product should re-energize the current customer base, resulting in
increased frequency of play, and also position the facility to compete more effectively
for non-resident rounds. Results of ERA’s 2008 survey revealed that the number one
reason Palo Alto GC was not the primary course of respondents was “course
quality/play experience”. Maintenance conditions that will position the facility in the
mid-to-upper tier of municipal golf courses in this market.
Non-resident green fees at Palo Alto, especially on weekends, are at the low end of
the price range among the direct municipal competitors. With an improved product,
there should be little resistance to modest price increases at the “Baylands”.
Maintaining a strong price/value proposition will ensure that the improved golf course
remains very competitive in the area market despite expected modest fee increases.
Palo Alto Municipal Golf Course is operating at rounds levels that are will below peak
levels from 1990s and early-to-mid 2000s. The facility has achieved rounds played
levels close to what NGF Consulting is projecting under the most favorable option as
recently as FY 2008.
The Bay Area remains one of the most active markets for municipal golf in the
nation. At the peak of the market, Palo Alto and several of its chief competitors
realized annual activity levels approaching, or even exceeding, 100,000 rounds.
Though play levels may never approach these extraordinary numbers again, we
believe the market has the potential to make a recovery.
NGF believes there is a lack of truly outstanding direct competitors to Palo Alto GC.
Also, it is likely that no new golf course inventory will be added to this market for the
foreseeable future.
Potential for regional economic recovery, increased discretionary income, etc. The
Bay Area and Silicon Valley have some specific economic attributes that act as
natural demand drivers for quality golf courses, including high incomes, an extremely
robust corporate presence, and one very high visitation numbers.
Other Considerations Regarding Improvement Options
Aside from the expected economic impact of the various base Reconfiguration Options, there
remain questions that will need to be addressed as the City weighs the reconfiguration options,
their respective forecasts in terms of rounds/revenue and what additional work will still be
required in the instance of doing less now and deferring certain improvements to later. The
overriding decision to be made is plan option (A, D, F or G) to go with and how that fundamental
decision will affect future decisions. For example, reconfiguration Option A, while least costly of
those to be considered, precludes routing improvements beyond those of the few holes being
shifted and places overall restrictions on future improvements to the golf asset. Largely, the golf
course would remain the same in its anatomy for the long term under A, but of course the golf
course may be in much better condition and may be complemented by better support amenities
in the future. The misconnection may be the course itself — much nicer, but as our grading
exercise concludes, not to the level of the other options because of their improvements to hole-
orientation, variety and excitement.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 49
The success rate for increased revenues, better reputation and the ability to be true to the idea
of a transformed golf experience, increases with a more intensive re-working of the golf course.
The decision on which option to adopt will need to take into account many factors, together with
the financial forecasts prepared.
OPTION “G” SENSITIVITY ANALYSIS
As noted, pro forma projections have been made under a set of assumptions that may or may
not come to fruition. Also, projections are subject to several uncontrollable factors such as
yearly weather variations, economic conditions, and the nature of the competition. Therefore, in
the interest of conservatism we have prepared a sensitivity analysis for Option G (identified by
the City as the preferred option) of two key variables related to revenues – rounds played and
average green fee. Specifically, we have run three scenarios that present deviations from the
“base” model presented above: (1) Rounds reduced to moderately lower than projected FY 12
performance, continuing downward trend; (2) Average green fee increasing over current by just
less than half the 15% projected increase in base model; and (3) Rounds and average green
fees both lower, in combination. Because of the virtually limitless number of combinations, other
variables, such as fixed operating expenses, remain the same as in the base scenario.
The sensitivity scenarios reveal that the lower than projected (base) green fee growth would
result in a reduction in net income of approximately 47% over the base case. Reduced rounds
result in a ±$500,000 reduction in net income, while the “worst case” – both rounds and green
fee increases below the projected base model – produces about $640,000 lower net income.
Option “G” Sensitivity Analysis - Summary for 2017
Summary in FY2017
Expected Case
Option G
Reduced
Rounds
Option G
Reduced Fees
Option G
Reduced
Rounds + Fees
Option G
TOTAL ROUNDS 75,700 63,100 75,700 63,100
ANNUAL ROUNDS REVENUE $2,680,949 $2,221,879 $2,487,511 $2,062,380
AVERAGE GREEN FEE PER ROUND $35.42 $35.21 $32.86 $32.68
Revenues FY2017
Projected
FY2017
Projected
FY2017
Projected
FY2017
Projected
Total Golf Course Revenues $3,452,900 $2,865,400 $3,259,500 $2,705,900
Concessions
Total from F & B Concession $91,800 $81,100 $91,800 $81,100
Total From Pro Shop Concession $30,700 $25,600 $30,700 $25,600
Total Gross to City $3,575,400 $2,972,100 $3,382,000 $2,812,600
Expenses
Total City Operating Expenses 2,146,000 2,088,800 2,143,300 2,086,600
Net Income From Operations (Loss)$1,429,400 $883,300 $1,238,700 $726,000
Total Income (Incl. Non-operating)$1,454,800 $908,700 $1,264,100 $751,400
Total Debt/Other Charges $1,092,100 $1,046,200 $1,072,800 $1,030,200
Net Income or (Loss)$362,700 ($137,500)$191,300 ($278,800)
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 50
Option G Sensitivity Spreadsheets
Palo Alto Golf Course Revenue / Expense - Option G (Reduced Rounds Sensitivity)
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Total Rounds 66,740 64,700 47,900 16,000 53,150 58,100 63,100 67,900 67,900 67,900 67,900
Golf Course Revenues
Green Fees (Incl. Cards)$2,016,537 $1,960,100 $1,445,100 $544,300 $1,810,100 $2,013,600 $2,221,900 $2,424,700 $2,448,900 $2,473,400 $2,498,200
Cart Fees 302,799 293,500 173,900 72,600 243,600 268,900 295,000 320,600 323,800 327,000 330,300
Driving Range 343,911 333,400 197,500 82,400 276,600 305,400 335,000 364,100 367,700 371,400 375,100
Tournament / League Fees 2,196 2,100 1,600 500 1,700 1,900 2,100 2,200 2,200 2,200 2,200
Other 11,813 11,500 6,800 2,800 9,400 10,300 11,400 12,300 12,500 12,500 12,800
Total Golf Course Revenues $2,677,256 $2,600,600 $1,824,900 $702,600 $2,341,400 $2,600,100 $2,865,400 $3,123,900 $3,155,100 $3,186,500 $3,218,600
Concession Payments
Food and Beverage Concession
Variable Portion $55,076 $53,400 $31,600 $13,200 $44,300 $48,900 $53,700 $58,300 $58,900 $59,500 $60,100
Utility Payment $25,920 $25,900 $26,400 $26,400 $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total from F & B Concession $80,996 $79,300 $58,000 $39,600 $71,200 $75,800 $81,100 $85,700 $86,800 $87,400 $88,600
Pro Shop Lease
Merchandise (4%)$26,536 $25,700 $15,200 $6,400 $21,100 $23,100 $25,600 $27,500 $28,100 $28,100 $28,600
Total From Pro Shop Concession $26,536 $25,700 $15,200 $6,400 $21,100 $23,100 $25,600 $27,500 $28,100 $28,100 $28,600
Total Gross to City $2,784,788 $2,705,600 $1,898,100 $748,600 $2,433,700 $2,699,000 $2,972,100 $3,237,100 $3,270,000 $3,302,000 $3,335,800
Operating Expenses
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Salaries & Benefits $259,455 $139,000 $145,300 $151,800 $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Range Fees 130,152 126,700 75,100 31,300 105,100 116,100 127,300 138,400 139,700 141,100 142,500
Cart Fees 117,529 117,400 69,600 29,000 97,400 107,600 118,000 128,200 129,500 130,800 132,100
Club Fees 5,576 5,700 4,600 1,700 5,700 5,800 5,900 6,000 6,100 6,200 6,300
Fixed Lozares Management Fee 345,333 345,300 259,000 86,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300
Merchant Fees Reimbursement 36,211 36,400 25,500 9,800 32,800 36,400 40,100 43,700 44,200 44,600 45,100
Contract Maintenance 475,000 750,000 562,500 206,300 825,000 837,400 850,000 862,800 875,700 888,800 902,100
Repairs & maintenance 21,943 22,300 17,800 6,700 22,300 22,600 22,900 23,200 23,500 23,900 24,300
Advertising & Publish 10,765 10,900 8,700 45,000 30,000 17,000 17,300 17,600 17,900 18,200 18,500
Supplies and Materials 44,417 45,100 36,100 13,500 45,100 45,800 46,500 47,200 47,900 48,600 49,300
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 51
Palo Alto Golf Course Revenue / Expense - Option G (Reduced Rounds Sensitivity)
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Water Expense 361,870 246,000 250,900 133,000 183,000 188,500 192,300 201,000 210,000 219,500 229,400
Other Direct Charges (Incl. Electric) 45,263 45,900 36,700 13,800 41,500 42,100 42,700 43,300 43,900 44,600 45,300
Indirect Charges 102,571 104,100 83,300 31,200 104,100 105,700 107,300 108,900 110,500 112,200 113,900
Total City Operating Expenses $1,956,085 $1,994,800 $1,575,100 $759,400 $1,995,900 $2,036,000 $2,088,800 $2,146,600 $2,183,300 $2,221,400 $2,260,600
Net Income From Operations (Loss)$828,703 $710,800 $323,000 ($10,800)$437,800 $663,000 $883,300 $1,090,500 $1,086,700 $1,080,600 $1,075,200
Non-operating
Income from Sale of Property 35,230
D/S Income $0 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non-operating $35,230 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non-operating)$863,933 $740,700 $348,700 $14,900 $463,500 $688,800 $908,700 $1,116,400 $1,112,600 $1,080,600 $1,075,200
Debt Service $559,539 $499,000 $428,200 $429,000 $428,200 $430,800 $423,200 $432,300 $431,200 $0 $0
Payment to General Fund $94,849 $94,800 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Debt Service $0 $0 $0 $0 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300
Operating & Capital Reserve $0 $0 $0 $0 $181,000 $201,400 $222,200 $242,500 $244,900 $247,300 $249,800
Cost Plan Charges $41,455 $42,700 $44,000 $45,300 $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $695,843 $636,500 $472,200 $474,300 $1,007,200 $1,031,600 $1,046,200 $1,077,100 $1,079,900 $652,700 $656,800
Net Income or (Loss)$168,090 $104,200 ($123,500)($459,400)($543,700)($342,800)($137,500)$39,300 $32,700 $427,900 $418,400
NOTE: Option G would likely include additional revenue from soccer fields of approximately $78,000 per field per year ($234,000 for 3 fields).
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 52
Palo Alto Golf Course Revenue / Expense - Option G (Reduced Fees Sensitivity)
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Total Rounds 66,740 64,700 47,900 16,000 67,900 71,800 75,700 75,700 75,700 75,700 75,700
Golf Course Revenues
Green Fees (Incl. Cards)$2,016,537 $1,960,100 $1,445,100 $503,800 $2,172,600 $2,329,500 $2,487,500 $2,512,400 $2,537,500 $2,562,900 $2,588,500
Cart Fees 302,799 293,500 173,900 72,600 311,100 332,300 353,900 357,400 361,000 364,600 368,200
Driving Range 343,911 333,400 197,500 82,400 353,400 377,400 401,900 405,900 410,000 414,100 418,200
Tournament / League Fees 2,196 2,100 1,600 500 2,200 2,400 2,500 2,500 2,500 2,500 2,500
Other 11,813 11,500 6,800 2,800 12,000 12,700 13,700 13,700 13,900 13,900 14,200
Total Golf Course Revenues $2,677,256 $2,600,600 $1,824,900 $662,100 $2,851,300 $3,054,300 $3,259,500 $3,291,900 $3,324,900 $3,358,000 $3,391,600
Concession Payments
Food and Beverage Concession
Variable Portion $55,076 $53,400 $31,600 $13,200 $56,600 $60,400 $64,400 $65,000 $65,700 $66,300 $67,000
Utility Payment $25,920 $25,900 $26,400 $26,400 $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total from F & B Concession $80,996 $79,300 $58,000 $39,600 $83,500 $87,300 $91,800 $92,400 $93,600 $94,200 $95,500
Pro Shop Lease
Merchandise (4%)$26,536 $25,700 $15,200 $6,400 $27,000 $28,500 $30,700 $30,700 $31,300 $31,300 $31,900
Total From Pro Shop Concession $26,536 $25,700 $15,200 $6,400 $27,000 $28,500 $30,700 $30,700 $31,300 $31,300 $31,900
Total Gross to City $2,784,788 $2,705,600 $1,898,100 $708,100 $2,961,800 $3,170,100 $3,382,000 $3,415,000 $3,449,800 $3,483,500 $3,519,000
Operating Expenses
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Salaries & Benefits $259,455 $139,000 $145,300 $151,800 $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Range Fees 130,152 126,700 75,100 31,300 134,300 143,400 152,700 154,200 155,800 157,400 158,900
Cart Fees 117,529 117,400 69,600 29,000 124,400 132,900 141,600 143,000 144,400 145,800 147,300
Club Fees 5,576 5,700 4,600 1,700 5,700 5,800 5,900 6,000 6,100 6,200 6,300
Fixed Lozares Management Fee 345,333 345,300 259,000 86,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300
Merchant Fees Reimbursement 36,211 36,400 25,500 9,300 39,900 42,800 45,600 46,100 46,500 47,000 47,500
Contract Maintenance 475,000 750,000 562,500 206,300 825,000 837,400 850,000 862,800 875,700 888,800 902,100
Repairs & maintenance 21,943 22,300 17,800 6,700 22,300 22,600 22,900 23,200 23,500 23,900 24,300
Advertising & Publish 10,765 10,900 8,700 45,000 30,000 17,000 17,300 17,600 17,900 18,200 18,500
Supplies and Materials 44,417 45,100 36,100 13,500 45,100 45,800 46,500 47,200 47,900 48,600 49,300
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 53
Palo Alto Golf Course Revenue / Expense - Option G (Reduced Fees Sensitivity)
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Water Expense 361,870 246,000 250,900 133,000 183,000 188,500 192,300 201,000 210,000 219,500 229,400
Other Direct Charges (Incl. Electric) 45,263 45,900 36,700 13,800 41,500 42,100 42,700 43,300 43,900 44,600 45,300
Indirect Charges 102,571 104,100 83,300 31,200 104,100 105,700 107,300 108,900 110,500 112,200 113,900
Total City Operating Expenses $1,956,085 $1,994,800 $1,575,100 $758,900 $2,059,200 $2,095,000 $2,143,300 $2,179,600 $2,216,600 $2,255,100 $2,294,600
Net Income From Operations (Loss)$828,703 $710,800 $323,000 ($50,800)$902,600 $1,075,100 $1,238,700 $1,235,400 $1,233,200 $1,228,400 $1,224,400
Non-operating
Income from Sale of Property 35,230
D/S Income $0 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non-operating $35,230 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non-operating)$863,933 $740,700 $348,700 ($25,100)$928,300 $1,100,900 $1,264,100 $1,261,300 $1,259,100 $1,228,400 $1,224,400
Debt Service $559,539 $499,000 $428,200 $429,000 $428,200 $430,800 $423,200 $432,300 $431,200 $0 $0
Payment to General Fund $94,849 $94,800 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Debt Service $0 $0 $0 $0 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300
Operating & Capital Reserve $0 $0 $0 $0 $217,300 $233,000 $248,800 $251,200 $253,800 $256,300 $258,900
Cost Plan Charges $41,455 $42,700 $44,000 $45,300 $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $695,843 $636,500 $472,200 $474,300 $1,043,500 $1,063,200 $1,072,800 $1,085,800 $1,088,800 $661,700 $665,900
Net Income or (Loss)$168,090 $104,200 ($123,500)($499,400)($115,200)$37,700 $191,300 $175,500 $170,300 $566,700 $558,500
NOTE: Option G would likely include additional revenue from soccer fields estimated by City to be approximately $78,000 per field per year ($234,000 for 3 fields).
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 54
Palo Alto Golf Course Revenue / Expense - Option G (Reduced Rounds + Fees Sensitivity)
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Total Rounds 66,740 64,700 47,900 16,000 53,150 58,100 63,100 67,900 67,900 67,900 67,900
Golf Course Revenues
Green Fees (Incl. Cards)$2,016,537 $1,960,100 $1,445,100 $503,800 $1,680,700 $1,869,300 $2,062,400 $2,250,400 $2,272,900 $2,295,600 $2,318,600
Cart Fees 302,799 293,500 173,900 72,600 243,600 268,900 295,000 320,600 323,800 327,000 330,300
Driving Range 343,911 333,400 197,500 82,400 276,600 305,400 335,000 364,100 367,700 371,400 375,100
Tournament / League Fees 2,196 2,100 1,600 500 1,700 1,900 2,100 2,200 2,200 2,200 2,200
Other 11,813 11,500 6,800 2,800 9,400 10,300 11,400 12,300 12,500 12,500 12,800
Total Golf Course Revenues $2,677,256 $2,600,600 $1,824,900 $662,100 $2,212,000 $2,455,800 $2,705,900 $2,949,600 $2,979,100 $3,008,700 $3,039,000
Concession Payments
Food and Beverage Concession
Variable Portion $55,076 $53,400 $31,600 $13,200 $44,300 $48,900 $53,700 $58,300 $58,900 $59,500 $60,100
Utility Payment $25,920 $25,900 $26,400 $26,400 $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total from F & B Concession $80,996 $79,300 $58,000 $39,600 $71,200 $75,800 $81,100 $85,700 $86,800 $87,400 $88,600
Pro Shop Lease
Merchandise (4%)$26,536 $25,700 $15,200 $6,400 $21,100 $23,100 $25,600 $27,500 $28,100 $28,100 $28,600
Total From Pro Shop Concession $26,536 $25,700 $15,200 $6,400 $21,100 $23,100 $25,600 $27,500 $28,100 $28,100 $28,600
Total Gross to City $2,784,788 $2,705,600 $1,898,100 $708,100 $2,304,300 $2,554,700 $2,812,600 $3,062,800 $3,094,000 $3,124,200 $3,156,200
Operating Expenses
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Salaries & Benefits $259,455 $139,000 $145,300 $151,800 $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Range Fees 130,152 126,700 75,100 31,300 105,100 116,100 127,300 138,400 139,700 141,100 142,500
Cart Fees 117,529 117,400 69,600 29,000 97,400 107,600 118,000 128,200 129,500 130,800 132,100
Club Fees 5,576 5,700 4,600 1,700 5,700 5,800 5,900 6,000 6,100 6,200 6,300
Fixed Lozares Management Fee 345,333 345,300 259,000 86,300 345,300 345,300 345,300 345,300 345,300 345,300 345,300
Merchant Fees Reimbursement 36,211 36,400 25,500 9,300 31,000 34,400 37,900 41,300 41,700 42,100 42,500
Contract Maintenance 475,000 750,000 562,500 206,300 825,000 837,400 850,000 862,800 875,700 888,800 902,100
Repairs & maintenance 21,943 22,300 17,800 6,700 22,300 22,600 22,900 23,200 23,500 23,900 24,300
Advertising & Publish 10,765 10,900 8,700 45,000 30,000 17,000 17,300 17,600 17,900 18,200 18,500
Supplies and Materials 44,417 45,100 36,100 13,500 45,100 45,800 46,500 47,200 47,900 48,600 49,300
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 55
Palo Alto Golf Course Revenue / Expense - Option G (Reduced Rounds + Fees Sensitivity)
FY2011
Actual
FY2012
Projected
FY2013
Projected
FY2014
Projected
FY2015
Projected
FY2016
Projected
FY2017
Projected
FY2018
Projected
FY2019
Projected
FY2020
Projected
FY2021
Projected
Water Expense 361,870 246,000 250,900 133,000 183,000 188,500 192,300 201,000 210,000 219,500 229,400
Other Direct Charges (Incl. Electric) 45,263 45,900 36,700 13,800 41,500 42,100 42,700 43,300 43,900 44,600 45,300
Indirect Charges 102,571 104,100 83,300 31,200 104,100 105,700 107,300 108,900 110,500 112,200 113,900
Total City Operating Expenses $1,956,085 $1,994,800 $1,575,100 $758,900 $1,994,100 $2,034,000 $2,086,600 $2,144,200 $2,180,800 $2,218,900 $2,258,000
Net Income From Operations (Loss)$828,703 $710,800 $323,000 ($50,800)$310,200 $520,700 $726,000 $918,600 $913,200 $905,300 $898,200
Non-operating
Income from Sale of Property 35,230
D/S Income $0 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non-operating $35,230 $29,900 $25,700 $25,700 $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non-operating)$863,933 $740,700 $348,700 ($25,100)$335,900 $546,500 $751,400 $944,500 $939,100 $905,300 $898,200
Debt Service $559,539 $499,000 $428,200 $429,000 $428,200 $430,800 $423,200 $432,300 $431,200 $0 $0
Payment to General Fund $94,849 $94,800 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Debt Service $0 $0 $0 $0 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300
Operating & Capital Reserve $0 $0 $0 $0 $168,100 $186,900 $206,200 $225,000 $227,300 $229,600 $231,900
Cost Plan Charges $41,455 $42,700 $44,000 $45,300 $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $695,843 $636,500 $472,200 $474,300 $994,300 $1,017,100 $1,030,200 $1,059,600 $1,062,300 $635,000 $638,900
Net Income or (Loss)$168,090 $104,200 ($123,500)($499,400)($658,400)($470,600)($278,800)($115,100)($123,200)$270,300 $259,300
NOTE: Option G would likely include additional revenue from soccer fields estimated by City at approximately $78,000 per field per year ($234,000 for 3 fields).
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 56
Other Issues and Considerations
MARKET POSITION / RE-BRANDING OPPORTUNITY
NGF Consulting has reviewed the image and brand recommendations made to the City as part
of the expanded scope of services to address long range considerations. We conclude that
closer integration of the golf course to the Palo Alto Baylands Preserve, “The Baylands”, should
positively affect the City’s efforts to brand this area as a destination for Palo Alto residents and
visitors alike. Celebrated as an open space and nature preserve area, the Baylands represents
a rich and positive locale within Palo Alto and the Silicon Valley Region and will be enhanced
with an improved and re-branded golf product.
Currently, Palo Alto Municipal Golf Course effectively lacks a brand image, and the facility is
very closely associated with the long-time golf concessionaire – so much so that the website
address for the golf course is bradlozaresgolfshop.com, and recorded phone messages mention
only the golf shop and not the golf course. We believe that a name change to “Baylands Golf
Club at Palo Alto” represents a positive move that will have the effect of repositioning the golf
course, distancing it from a “muni” layout. Additionally, it will signal a transformation from an
older, “worn down” layout to one that has renewed excitement and positive change. The
recommendation to retain “Palo Alto” as part of the course image and brand is a good way to
connect with the existing name, as well as the City itself. Use of “Golf Club” in lieu of “Golf
Course” is an additional signal that the golf experience is not only something new, but at a
higher quality.
The marketing theme “Public only in price, access and pride”is an excellent message to remind
the customer that the golf facility remains accessible, open to the public and priced to provide
one of the better golfing values in the Bay Area. This message also reinforces the
transformation, ideally a win-win for the golf consumer to receive high quality at a “municipal”
price point.
Sample magazine ads provided as part of the Marketing and Theme recommendations hit on
important concepts, including:
Silicon Valley Location
Tradition – The design legacy of Billy Bell
The Transformation (i.e., the changes)
The “Green” Environmental Commitment of the Facility
Our belief is that proper implementation (adequate budgets, quality control and proper media
placement) of the program will have a dramatic effect on driving new business to the “new” golf
facility. Equally important will be the affect that these messages and the new brand will have on
existing customers, and residents of Palo Alto and its neighboring communities who currently
play golf elsewhere. In essence, the program for re-branding, introducing a new image and
theme, and the marketing program, has the potential to have a very positive affect on rounds
and associated revenues.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 57
A commitment on the City’s part to becoming certified with Audubon international as a
“Sanctuary Golf Facility” is an integral part of the ability to market the course as a “green” aware
and operated golf facility. This goal should be undertaken regardless of which reconfiguration
option is opted by the City and should be workable given the operation and/or marketing
budgets afforded. (Note: Beginning this process now, prior to any reconfiguration work, will help
guide the reconfiguration work and will also establish a greater degree of improvement by which
to attain the Audubon status for the facility).
Plan Option A poses the greatest challenge to be consistent with the image, brand and
marketing changes recommended because it does not go as deep into the many areas of the
course in terms of new features and reconstructed areas. However, the fact that Plan Option A
will dramatically reduce turf through the course-wide work to create native areas and new
“Baylands” themed areas should be an adequately appreciated change. Plan Options D, F and
G will have no issues aligning with any of the themes and messages recommended.
With emphasis on a quality, outstanding golf facility, the City may be able to realize what we
have referred to as a “destination” public golf experience. In the Bay area we would point to
such courses as Pasatiempo in Santa Cruz and Harding Park in San Francisco as meeting this
definition. These two courses are good examples of courses that have attained a reputation
through the following attributes:
Legacy of the original design
Transformation from marginal to excellent conditions
Commitment by the municipal owners to reinvest in the assets
Quality rebuilding efforts
Good marketing of the finished courses and facilities
While both of the above examples are classic era designs (Pasatiempo by Alister MacKenzie,
and Harding Park by Willie Watson) it is still appropriate to reference their successes relative to
what Palo Alto Golf Course could attain. Whether undertaken under one, larger reinvestment
project, or carried out over time, the potential transformation of Palo Alto Golf Course is
bolstered by a number of factors inherent in the facility:
A design legacy that can be leveraged — William P. and William F. Bell, the former
responsible for designs such as Stanford, Riviera and Bel-Air
A location that sits at the heart of Silicon Valley
A seaside setting that has greater potential to take advantage of its natural
landscape — the Baylands environment, Bay and adjoining Sanfrancisquito Creek
A population base that is robust for golf rounds by non-residents
A location that is in one of the top tourist areas in the nation
Obviously, undertaking more intensive reconfiguration (such as with Plan G) will transform more
of the existing course and is likely to meet this goal on a stronger basis. So, too, may investing
in more of the alternate, optional improvements, including many of the long range improvements
before the City for consideration.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 58
ECONOMICS OF POTENTIAL LONG-TERM / ADDITIONAL IMPROVEMENTS
Forrest Richardson has proposed that the City study the feasibility of certain facility
improvements that are in addition to the base improvements recommended within
Reconfiguration Options A, D, F, and G (please see Appendix E for summary table of potential
improvements and estimated costs). Though NGF believes that many of these improvements
would improve the overall quality of the golfer (and non-golf customer) experience, as well as
the image of the facility in the eyes of area golfers, it is not practical to assign incremental
rounds played and revenue dollars to many of these improvements (e.g., exterior and entry
upgrades, signage/parking, rebuilding practice greens, “alternate” golf course improvements,
designated youth area). Practically, these improvements, to varying degrees individually and
certainly as a sum of their parts, are likely to draw more patrons overall, keep them on-site
longer, and increase their propensity to spend while at the golf course.
We have confined our break-even analysis to several potential improvements that tie more
directly to revenue: (1) The cart storage building; (2) Expanded meeting space; and (3) Range
Performance Center.
Cart Storage Building
At just $4.54 per round in FY 2011, the average gross cart fee revenue per round at Palo Alto
Golf Course significantly trails the average of its chief competitive set (see ERA 2008 report for
City). While the low cart utilization is partially a function of the “walkability” of the golf course,
ridership and revenues have also likely been constrained by the very limited cart storage. Palo
Alto GC has only 46 carts available, some of which are older gasoline powered carts stored in
open storage outside the clubhouse (fewer than 35 carts can be stored below the clubhouse). A
more typical inventory for most regulation length 18-hole golf courses is ±70 carts. We are told
that for larger tournaments, additional carts must be leased and brought in from off-site. In
summary, NGF believes it is likely that the limited cart inventory and storage space available
has constrained ridership and may have actually negatively affected demand for daily fee and,
especially, tournament play on occasion.
As part of Forrest Richardson’s overall capital improvement plan for Palo Alto GC, he has
included construction of a new cart storage building at an estimated cost of $440,000. In the
table below, we illustrate the number of years it will take for the City to break even on this
investment, assuming different levels of incremental gross cart rental revenue per round, the
current rent percentage of 60%, and stabilized rounds activity under Options D and F – 73,300
rounds. Of course, as noted, it is possible that having additional carts will have a positive effect
on rounds played as well, but for purposes of conservatism we are illustrating only increases in
cart revenue per round. We also assume that all expenses associated with the cart lease and
maintenance will remain the responsibility of the vendor, and that there will be no incremental
City operating costs associated with the new building.
Palo Alto Golf Course
Break-Even Analysis for Cart Storage Building
Average Gross Cart Revenue Per Round Increase
$0.50 $1.00 $1.50 $2.00 $2.50
Incremental Gross Revenue*$36,650 $73,300 $109,950 $146,600 $183,250
Incremental Revenue to City*$21,990 $43,980 $65,970 $87,960 $109,950
Years to B/E*20.0 10.0 6.7 5.0 4.0
*Assumes $440,000 estimated cost and stabilized rounds played of 73,300 from Options D,F
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 59
Expanded Meeting Space
The existing restaurant at Palo Alto GC has limited meeting space that has significantly
constrained meeting and banquet business at the facility. Not being able to accommodate larger
events of ±250 people precludes the facility from competing for the most lucrative, high margin
food & beverage business. As such, expanding the meeting/banquet space is another
component of the long range improvement plan prepared for the City by Mr. Richardson.
Based on the estimated cost provided of $1.7 million, and assuming the City incurs all of the
cost of the improvement, the annual debt service on a 20-year note at 3.5% would be $120,000
(rounded). NGF has calculated that the incremental annual gross food & beverage revenue
necessary to generate $120,000 in additional rents to the City to meet the annual debt service is
more than $1.71 million. This calculation is based on the current rent percentage of 7%.
In its 2008 study, ERA noted: “Based on the experience of similar golf course oriented banquet
facilities and the demographics of the area, expanding the clubhouse to accommodate special
events with up to 250 attendees would add $600,000 to $700,000 in annual special event
revenue. This rental income would justify about one-half of the cost of the improvements.” NGF
concurs that achieving this level of incremental gross revenue would likely be an achievable
goal, but with updated cost estimates, this level of revenue would justify only about 40% of the
investment cost. Therefore, the balance of the City investment in the expanded facility would
have to be justified through the incremental rounds and associated revenues attributable directly
to the expanded meeting facilities. Based on current and projected average green + cart (City
share) fee revenue per round, it would take 2,000 to 3,000 of these rounds to help fund the
expanded facilities. Of course, the equation would change markedly if gross revenues accrued
to the City under an alternate operating structure.
Range Performance Center
In the table below, we provide a similar break-even analysis to the one for the cart storage
building. Mr. Richardson’s cost estimate for the range performance center, plus the additional 6-
bay range expansion (we assume both are undertaken together), is $600,000. In the table
below, we illustrate the number of years it will take for the City to break even on this investment,
assuming different levels of incremental gross driving range revenue per round (gross per round
was $5.15 in FY 11), the rent percentage of 62%, and stabilized rounds activity under Options D
and F – 73,300 rounds. Of course, it cannot be determined what percentage of range activity is
a function of number of bays as opposed to rounds played, so we have chosen to do a
sensitivity analysis by increasing average revenue per round rather than per tee station. Another
factor driving this methodology is that the performance center bays will be used for teaching,
and will likely have less utilization than the already existing bays.
We also assume that all incremental expenses associated with the expanded range remain the
responsibility of the concessionaire, and that there will be no incremental City operating costs
associated with the new building. Finally, we assume that the City receives no lesson revenue.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 60
Palo Alto Golf Course – B/E Analysis for Range Performance Center + 6-Bay Expansion
Average Gross Range Revenue Per Round Increase
$0.50 $0.75 $1.00 $1.25 $1.50
Incremental Gross Revenue*$36,650 $54,975 $73,300 $91,625 $109,950
Incremental Revenue to City*$22,723 $34,085 $45,446 $56,808 $68,169
Years to B/E*26.4 17.6 13.2 10.6 8.8
*Assumes $600,000 estimated cost and stabilized rounds played of 73,300 from Options D,F
MANAGEMENT STRUCTURE
NGF was told that some City staff would like to further explore - via issuance of an RFP in
advance of the Pro Shop and Maintenance agreements expiring in April, 2013 - the implications
of changing the operating structure at Palo Alto Golf Course to a management contract. We
have been asked to offer our opinion as to whether this type of structure would be more
effective, or produce higher net operating income to the City, than the current “hybrid” structure
that involves both a management fee and a concession on the golf operations side, privatized
maintenance, and a separate food & beverage concession.
As Economic Research Associates (ERA) noted in their 2008 Operations Review of the Palo
Alto Municipal Golf Course, the current agreement for golf operations evolved due to IRS
regulations related to the tax-exempt financing utilized for the late 1990s renovation of the golf
course. Specifically, at least 50% of the compensation within a management agreement must
be fixed fee in such a case. ERA, after doing the full operations analysis, concluded that the
current pro shop deal was “slightly favorable” to the concessionaire.
After running cash flow models under various operating scenarios, ERA concluded that City Net
Income was maximized with private maintenance (subsequently put in place) and “market rate”
concession terms. However, they also noted that “market rate”, which involved lower
concession rents to the City and an elimination of the management fee, was not permissible by
the IRS without a restructuring of the current debt. ERA concluded that, among the operating
models that were permissible within the current debt framework, the structure that is now in
place at Palo Alto Golf Course – no change in contract terms, but with private maintenance –
produced the highest City Net Income. A full-service Management Agreement produced the
second highest City Net Income.
Without doing a full operations review, NGF does not have sufficient information to critically
evaluate ERA’s analysis or to identify the operating structure that would be the best fit for Palo
Alto GC. While there are a number of advantages to the full service management contract
structure, it is also true that “no one size fits all”. There are many factors and variables to
consider when evaluating options, and it would be unfair to both the City and the current
vendors for a consultant to make a recommendation regarding the optimal structure without
being retained to do a full facility analysis. Carefully evaluating the value proposition that each of
the current vendors brings to the table would be just one component of such an analysis. For
instance, the golfer survey that ERA implemented as part of their 2008 study showed that Brad
Lozares was rated quite high by golfers, indicating considerable goodwill and “equity” built up in
the golf shop. Similarly, NGF has been told of improved maintenance conditions (as well as
considerable cost savings) since ValleyCrest was brought on.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 61
Having said that, we do feel confident recommending that the City retain the current
structure at least through the completion of the renovation project.However, delaying
consideration of a fundamental change in operating structure should not preclude
modifying terms. For instance, the City and the golf vendor may come to an agreement
resulting in lowering the management fee to reflect reduced responsibilities and
concession revenues during renovation (especially under Option G), while still adhering
to IRS guidelines.Not only will the project substantially disrupt business, but significant
unknowns include the timing of the project and how the newly improved facility will cash flow
after being brought back to market and “re-branded”. Also, the food & beverage contract doesn’t
expire until 2018, so some of the advantages of the single operator management structure may
be lessened unless an early termination to the agreement can be successfully negotiated with
the current vendor. Finally, negotiating a new agreement during construction, when proposers
themselves will not have full information about how the improved facility will cash flow, may
result in the City not entering into the best deal possible.
NGF believes that these are just a few of the important variables that make issuing an RFP at
this stage less than optimal. We recommend that the City wait until after renovation is
completed and the improved facility has been up and running for a year or more before
considering a substantive change in structure. This strategy will provide additional information
that will put the City in a better position to make an informed decision regarding operating
structure (for instance, the City may find that the improved “Baylands Golf Club” has significant
upside revenue potential, thus making it relatively more attractive to control all revenues under
the management contract structure).
LONG RANGE CONCERNS
Concerns raised through the public process of reviewing reconfiguration options have included
the following long term implications:
High salts present in the native soils
Intrusion by geese and burrowing animals
Potential for the adjacent airport to negatively affect the golf experience
In essence, the question raised is: “Can the Palo Alto Golf Course be expected to become a
significantly better golf experience given these issues?”
NGF Consulting relies on the opinions of professionals associated with individual golf facilities to
address certain questions. For example, in the case of the high salts we look to agronomists,
the course superintendent and/or the golf course architect. In the case of animal intrusion,
because these are often site specific, we look to nearby facilities to see how they have dealt
with the issue.
High Salts
Soils high in salts are not uncommon to golf courses located along coastal waterways and
oceans. In the case of Palo Alto the soils are not only affected by the location by San Francisco
Bay, but by the poorly draining soil types. Additionally, the use of effluent (recycled) water,
which typically has higher salt content, exacerbates the condition. While our work has not
included agronomic evaluation, we have endeavored to understand the general situation by
comparing outcomes we have observed at other golf operations.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 62
“Links courses,” those layouts along the dunes formed coasts of the British Isles and similar
locales around the world, are prone to salty soils. Yet, with their sandy soil basis, these sites
support good turf because the salts are leached regularly downward by natural rains. This is the
hallmark of links courses, and why their development on these natural, sandy soils were so
appropriate. When soils are not sandy and porous, the build-up of salts becomes problematic.
This is the case at Palo Alto Golf Course, where management over the years has been to
periodically irrigate with fresh water, driving salts downward, and to add gypsum to the soils.
Additionally, the most recent remodeling work added a cap of sand and better soil mix to several
fairways, making them much easier to manage and support healthy turf. These best practices
have resulted in reasonably healthy turf growth despite the salty soil conditions.
According to staff, while salts are high, the turf has “learned” to adapt. There is a definite
difference between fairways where the sand cap has been placed and areas where drainage is
not as good and where older native soils are present. Also, Paspalum turf varieties have
flourished at the golf course in a few areas. These areas appear to have much better success
rates of healthy growth because the nature of Paspalum grass is to tolerate salts to a
significantly higher degree.
NGF Consulting posed the question of managing high salts to Forrest Richardson & Associates,
specifically asking what additional measures would be afforded through the reconfiguration
options to address this issue. The response summary is as follows:
Management of existing sand capping and healthy turf rootzone material (the
uppermost layers of rootzone) will be managed through the reconfiguration, replacing
that material as “topsoil” to new fairway and turf areas; this cost is represented in the
probable cost estimates presented to the City for reconfiguration options.
New soils will be imported as possible within the budgets, potentially from the
Stanford University Medical Center project(s); these additional costs (and revenue
potential) have been accounted in probable cost estimates.
Paspalum turfgrass will be used to sod all new areas of fairways, roughs and tees
(Note: The specific variety is yet to be determined).
The irrigation system will provide dual watering capabilities, able to deliver potable
water to selected areas and a mix of effluent (higher salt counts) and fresh water;
this capability allows flushing (leaching of salts downward) as is being done
currently.
Significantly improved drainage is afforded in each reconfiguration option, helping to
prevent build-up of salts by quicker transportation of surface water away from turf
areas and the soil rootzone, and thereby reducing the build-up of salts that occurs
when water is allowed to stand and slowly seep into the rootzone.
These are prudent measures that are common among golf course sites with high salts present
in the soil. Additionally, we understand that the City has a goal to reduce salt counts within its
effluent water system, a goal that is not necessarily aimed at improving conditions at the golf
course, but will have a definite value to City’s golf operation asset.
While the success rate of overall condition improvement cannot be guaranteed, we can look at
comparable operations where high salts are effectively managed. There are numerous
examples of this throughout California, including the Bay Area. California examples include
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 63
Monarch Bay (San Leandro), Las Positas (Livermore), Metropolitan (Oakland), Olivas Links and
Buenaventura (Ventura), and Irvine (Shady Canyon Club).
Many courses with salt issues are turning to Paspalum turfgrass as an answer. Some of the
example courses cited have moved to 100% Paspalum grass. NGF Consulting notes that this
trend is widespread in Florida, the Caribbean, Mexico, South Texas, and Hawaii. In Hawaii, for
example, Paspalum varieties have literally transformed the golf landscape from a struggling
Bermudagrass region to one that now predominantly uses Paspalum in order to overcome high
salts from water, soils and the proximity to the ocean. Even in Monterey we are seeing
Paspalum use. At the Monterey Peninsula Club, for example, some areas located on the shore
that were never in good condition, have been completely re-planted with Paspalum and are now
in excellent condition.
Our conclusion is that Palo Alto can enjoy a good success over the long term at the existing golf
course site. Managing salts will have a good result, not only through good maintenance
practices, but in combination with the reconfiguration work, which should make the City’s efforts
to manage salts more productive, less costly and, ultimately, more impacting to a positive golf
experience.
Our caution is that the plan options (A, D, F and G) each have an associated result that is
specific to the investment. Plan A, for example, addresses only a minority of the course turf
areas (drainage, rootzone, topsoil management, irrigation, etc.) and will therefore not produce
positive results across the full golf course. Plan G, at the other end of the spectrum, resolves
virtually all areas.
Animal Intrusion
Managing Canadian Geese infestation is often dependent on regulations and restriction placed
on locales. Our advice to the City is to study available mitigation measures and to carefully note
the measures taken by neighboring courses. Geese populations have been successfully
managed through the following measures:
Trained dogs, such as border collies
Reducing standing water and open water (ponds, lakes, swamps)
Increasing habitat surrounding the golf course that will appeal to geese populations
Implementing noise, reflective or other repellants
Sterilization agents to stop generational return of geese to the golf course areas
Among the most successful operations in Northern California are the courses of the Monterey
Peninsula, notably Pebble Beach Companies and the private clubs in the area. With few
exceptions, these operators have used trained dogs to manage geese away from their turf
areas. An on-site dog specifically trained to manage geese populations remains the most
efficient measure to rid geese infestation from golf courses in the U.S. Not only is this method
humane, but it has the benefit of a lower cost than many other measures, and is less
interruptive to the golf experience. We understand there is added complexity relative to the
adjacent airport operation and the requirements associated with making sure that geese are not
diverted to the airport, but away from both the golf course and the airport. For this reason, we
recommend that the City take a look at jointly working out a plan for both the golf and airport
needs.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 64
With regard to the ground squirrel infestation, we understand that this is being met with ongoing
mitigation efforts that are allowed under state guidelines. Also, the increase of naturalized areas
afforded by all reconfiguration options will help drive habitat away from turf and in-play areas of
the golf course.
Airport Effects
Many golf facilities are located immediately adjacent to airports, and yet enjoy a good reputation
and high quality of golfing experience. We see no undue negative associated with the relatively
small private plane airport, especially given that the flight paths do not directly overtop the golf
course itself.
Moreover, Silicon Valley appears to be utilizing the airport for corporate flights in favor of the
larger regional airports that pose delays and complexities due to their scheduled, commercial
flight business. This fact may actually prove beneficial to the golf operation should the golf
course and its facilities be elevated a “destination” level of quality and reputation. The result with
nominal airport use is that more visitors to Palo Alto will know about the golf course and be able
to get a firsthand view of its offerings.
Summary
Based on experience and input from Forrest Richardson, NGF Consulting believes that long-
term mitigation of the concerns of this site is workable and worth the premiums required for
maintenance and management. In many cases, golf courses are located on degraded land
because that land cannot be used for other purposes. We suspect this is the case in Palo Alto
and would find it difficult to justify alternate solutions to the renovations that might be
considered: (a) continued operation in a declined state; (b) abandonment of the asset in favor of
a new location, given land values in the area; or (c) abandonment of the recreation amenity
altogether, given its high use and the financial forecasts presented.
POTENTIAL ECONOMIC DEVELOPMENT OF THE AIRPORT & GOLF
“BAYLANDS GATEWAY” AREA
The golf course “corner” and shared entry with the airport are considered a “gateway” to the
Baylands Preserve areas. As such, this intersection has great potential to become more than
just a golf clubhouse and airport with nominal retail offerings.
According to the Community Services Department, forward and creative thinking has been
aimed at the potential for this area to become a more user-friendly and service-oriented
destination. Thus far, thinking has included whether the area could support a modest collection
of cafes, retail shops, and perhaps even a hotel. While no formal plans have been
commissioned, the City has discussed a general, long range approach to looking more in depth
at this possibility.
Such development, especially if it included a small hotel, would add natural demand drivers in
immediate proximity to the golf course, thus resulting in increased rounds and revenues. As an
example, a 130-room business hotel in a high demand locale may have as many as 28,000
room nights based on an average 60% occupancy rate. Using a multiplier of 1.3 guests per
room, this equates to approximately 36,000 guests per year. Using a percentage of 10% golfers
and assuming that the golf course could get even 20% of these guests to play, the resulting
bump would be near 1,000 additional golfers per year. Also, these golfers would comprise non-
residents paying the highest applicable rates, and traveling golfers typically exhibit less price
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 65
sensitivity and would be likely to also spend money on the practice range, pro shop, and/or
restaurant.
PRIVATE FUNDING POSSIBILITIES
Of course, aside from receiving compensatory money from the San Francisquito Creek Joint
Powers Authority, the City may have to grapple with how to fund additional money required if
Reconfiguration Options D, F, or G is chosen, and/or if any work identified as “additional” or
“alternate” in this report it undertaken. One of the mechanisms that would obviously be very
preferable to the City is raising private money to fund some, or even all, of the needed money.
Based on preliminary discussion held between Forrest Richardson, NGF, and the City, the
private funding mechanism may take a combination of the following avenues that the City will
have to explore further:
Naming rights for some components of the facility (e.g., range performance center,
certain holes, tee markers, designated youth area); this may be feasible do to the
number of very wealthy individuals in Palo Alto, as well as the very strong corporate
(especially high-tech/ internet-based) presence.
Grants – for example, the First Tee, which is very active in the area.
Lease-Back – some within the City have mentioned the possibility of finding a
design/build entity that might be interested in undertaking all of the improvements,
including soccer fields if Option F or G is chosen, and restructuring the financing
package to get the entire project, including some or all optional master plan
improvements, done at one time. In this case, the ±$3 million the City receives from
the SFCJPA could be used toward paying off the old debt and a new arrangement
put in place for the work to rebuild the golf course.
The Stanford Soil Import is a wildcard in the equation. It could bring revenue into the
equation, but likely not more than $500,000. This may provide a partial funding
mechanism to help pay for some of the miscellaneous suggested work that will not
have a revenue stream attached directly to it (entry experience, trails, signage,
parking, etc.).
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 66
Appendices
APPENDIX A – COMPARATIVE SUPPLY RATIOS – PALO ALTO GC & KEY
MUNICIPAL COMPETITORS
APPENDIX B – COMPARATIVE SCORING OF RECONFIGURATION OPTIONS
APPENDIX C – WATER & POWER USE DISCUSSION & ASSUMPTIONS
APPENDIX D – REVIEW OF PROBABLE COST ESTIMATES
APPENDIX E – POTENTIAL LONG-TERM MASTER PLAN IMPROVEMENTS
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 67
APPENDIX A – COMPARATIVE SUPPLY RATIOS – PALO ALTO GC & KEY
MUNICIPAL COMPETITORS
NGF has presented a comparison of some key golf supply measures for Palo Alto GC and its
key municipal competitors, with the 5-mile radius around each facility the basis for comparison.
We note that all of the subject facilities, except for Santa Teresa, have very high
household/supply ratios, which is one of the key factors that explains the very high rounds
figures realized per 18 holes among municipal golf courses in this market.
Also of note, in its 2009 publication “The Future of Public Golf in America,” NGF hypothesized
that the best predictor of a public golf course’s success was the number of golfers per 18 holes
within a 10-mile radius, with 4,000 identified as the key number for projected financial stability.
As shown in the second table below, all of the subject courses (again with exception of Santa
Teresa) exceed this number for the 5-mile market.
Golf Facility Supply – 2011 (5-Mile Radius)
5-mile Rings
Total No. of
Golf Facilities
Total No. of
Golf Holes
Households
per 18 holes
Households
per 18 Hole
Index
(US=100)
Palo Alto Golf Course 4 72 19,836 251
Poplar Creek Golf Course 5 81 17,942 227
San Jose Municipal Golf Course 6 90 31,377 398
Santa Clara Golf & Tennis Club 6 90 21,027 266
Santa Teresa 6 135 7,841 99
Shoreline Golf Links 4 72 24,206 307
Sunnyvale Golf Course 8 126 19,435 246
Source: National Golf Foundation
Golfers per 18 Holes (5-Mile Radius)
5-mile Rings
Golfing
Households
Est. No. of
Golfers1
Total 18-H
Equivalent
Golfers per
18 holes
Palo Alto Golf Course 14,206 21,309 4 5,327
Poplar Creek Golf Course 14,243 21,365 4.5 4,748
San Jose Municipal Golf Course 30,527 45,791 5 9,158
Santa Clara Golf & Tennis Club 17,855 26,783 5 5,357
Santa Teresa 12,250 18,375 7.5 2,450
Shoreline Golf Links 16,695 25,043 4 6,261
Sunnyvale Golf Course 24,118 36,177 7 5,168
Total U.S. “Threshold” for Successful Public Golf (10-mile Ring)4,000
1 Golfing Households x 1.5
Source: National Golf Foundation
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 68
APPENDIX B – COMPARATIVE SCORING OF RECONFIGURATION
OPTIONS
As a useful tool in formulating pro forma projections, NGF has compared the Reconfiguration
Options using a “scorecard approach” whereby attributes and benefits are assigned scores (1-
10). This method allows a side-by-side comparison, providing a way to review pluses and
minuses associated with each option. We base our scoring on several factors, including the
following:
Details presented (plans, conceptual images, etc.)
Public comments and historical use of the facility (rounds and use)
NGF Market Analysis (local and regional trends and golf participation)
Competition within the market area
Details and other givens regarding the changes to take place (golf design consultant
involved, how far along the proposed changes have been studied, budgets, etc.)
Long term viability of the changes and market acceptance
Known preferences of golfers relative to course conditioning, consistency, etc.
Quality of the consultants involved
In situations where golf facilities are proposed to be reconfigured, there are both subjective and
objective considerations. Additionally, there is often difficulty in verifying to what degree
proposed changes will be carried out. Fortunately in the case of the Palo Alto Golf Course, the
City and SFCJPA have accommodated a very thorough process and detail so we are able to
look at the plans, before and after images, and other documentation that quantify the changes
associated with the options.
Scoring is one factor considered in estimating potential changes in the financial performance of
the golf facility. For example, a golf course with significantly more practice opportunities,
especially when such use is in demand, will potentially bring in new use and associated
revenue. In the case of a significant transformation of a golf course from an average or below
average experience to one with new holes, views and overall landscape improvement, it is likely
that an increase in use and/or revenue will be realized. And, where we can see potential to
market the facility beyond the immediate area, it is possible to realize an added price-per-round
for non-resident use. In this latter example we often cite the ability of golf courses such as
Torrey Pines to adopt a green fee structure that holds low rates for residents of the area while
charging market rates that are very high for players from out of state. In the case of Torrey
Pines, the gap between resident rates and visitor rates are among the widest in the golf
business. Though this type of gap will not be realistic for Palo Alto, we do expect that,
depending on the reconfiguration option chose, non-residents will effectively be “subsidizing” to
some degree a high quality, but still affordable, golf experience for city residents.
The following ratings use a 1-10 scale where 1 is the lowest and 10 is the highest. This ranking
includes some financial considerations, but is ancillary to the pro forma financial analysis for
each option. The rankings here are used to form some of the forecasts within the pro forma
analyses. Scoring is based on the base reconfiguration work for each option (i.e., less all
optional/alternate work listed). A summary table of rankings is presented following the category
descriptions.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 69
The following are categories used to form the scoring:
Yardage & Par –Accommodation of yardage (regulation length) for a course and par
that will be viable and competitive within the market and region
Interruption of Play During Reconfiguration – Ability of the plan to retain some holes
(9-hole play) and practice during reconfiguration work
Consistency of Bunkers & Hazards – Overall impact of the plan relative to bunker
consistency, aesthetics and other hazards
Consistency of Greens – Overall result of greens quality and consistency
Drainage Improvement – Overall positive impact on drainage; eliminating wet
conditions
Irrigation Improvement – Overall positive impact on irrigation control, consistency
and associated turf quality
Pace-of-Play – Degree to which the plan accommodates positive pace-of-play and
long range ability to manage for good pace
Improved Visual Impact –Overall landscape enhancements (added naturalizes
areas and visual impact)
Improved Views – Accommodation of more views to the Bay and territorial vistas
Improved Golf Experience Impact -Overall plan benefits to strategy, excitement of
holes, variation of direction, orientation to wind, etc.)
Competitiveness with Area Courses –Ability of the course to compete with courses
in the immediate area
Competitiveness with Regional Courses –Ability of the course to compete with
courses in the region
Likelihood for Destination Visits –Ability of the course to attract specific visits
expressly to play the course
Ability to Leverage “Green” Marketing –Consistency of the plan with a “green”
environmental message (Baylands tie-in, more naturalized areas, natural landscape,
etc.)
Consistency with Long Range Planning –Integration of the plan with future planning
(clubhouse, practice, etc.)
Turf Reduction (irrigation) –Reduction of managed turf acreage for less water use
and reduced pumping
Turf Reduction (managed care) –Reduction of managed turf in relation to the ability
to shift maintenance emphasis from out-of-play areas to golf features and areas
more appreciated by the golfer
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 70
Comparative Scoring of Reconfiguration Options
Option A Option D Option F Option G
Yardage & Par 8 8 8 6
Interruption of Play during Reconfiguration 5 4 3 1
Consistency of Bunkers & Hazards 7 8 9 10
Consistency of Greens 3 5 6 8
Drainage Improvement 4 6 8 9
Irrigation Improvement 3 6 7 10
Pace-of-Play 5 10 7 7
Improved Visual Impact 4 6 7 8
Improved Views 2 7 7 8
Improved Golf Experience Impact 3 7 8 8
Competitiveness with Area Courses 5 8 8 8
Competitiveness with Regional Courses 2 6 7 8
Likelihood for Destination Visits 1 5 7 7
Ability to Leverage “Green” Marketing 5 7 8 9
Consistency with Long Range Planning 7 9 9 9
Turf Reduction (irrigation)4 6 8 9
Turf Reduction (managed care)4 7 8 9
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 71
APPENDIX C – WATER & POWER USE DISCUSSION & ASSUMPTIONS
NGF Consulting was not charged with a full water or power use analysis. However, forecasting
costs associated with each reconfiguration option requires reasonable estimates on the affects
of a more efficient irrigation system combined with less turf acreage.
Our conclusions on water and power use are based on the following assumptions, derived from
City Staff and the golf course architect/design team:
Current irrigation (managed) turf acreage: 135
New irrigation areas efficiency over/above the existing system: +10%
Current irrigation inefficiency due to leaks and breaks (loss): -5%
Current power inefficiency: -10%
New power efficiency realized with full course better watering times/durations: +15%
Annual cost for irrigation repair due to age and condition: $30,000
Using the data and assumptions, NGF Consulting has developed the following forecast for
water and power use differences with each reconfiguration option.
Option A
Total irrigated turf following reconfiguration: 96.5 acres
Water use reduction based on new irrigated acreage: 28%
Approximate area of reconfigured course with new irrigation system: 35 acres
Percentage of irrigated Area with New Irrigation: 36%
Water use reduction of new usage based on efficiencies of new system area: 3.6%
(10% efficiency x 36% = 3.6%)
Water efficiency of new usage gained due to fewer leaks/breaks: 2% (5% efficiency x
36% = 2%)
Power efficiency realized with better watering times/duration: +5%
Conclusions
Reduced Water Cost Est. (effluent) $ - 0 -
Reduced Water Cost Est. (potable) $72,800 (28% x $260,000)
Reduced Water Cost Est. (potable efficiencies) $5,645 ([3.6% + 2%] x $100,800)
Reduced Power Cost Est. (efficiencies realized) $1,200(5% x $24,000)
Total Est. Reduction in Water & Power Cost $79,645 / annual
Option D
Total irrigated turf following reconfiguration: 92 acres
Water use reduction based on new irrigated acreage: 32%
Approximate area of reconfigured course with new irrigation system: 40 acres
Percentage of irrigated Area with New Irrigation: 43%
Water use reduction of new usage based on efficiencies of new system area: 4.3%
(10% efficiency x 43% = 4.3%)
Water efficiency of new usage gained due to fewer leaks/breaks: 2% (5% efficiency x
43% = 2%)
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 72
Power efficiency realized with better watering times/duration: +10%
Conclusions
Reduced Water Cost Est. (effluent) $- 0 -
Reduced Water Cost Est. (potable) $83,200 (32% x $260,000)
Reduced Water Cost Est. (potable efficiencies) $7,258 ([4.3% + 2%] x $115,200)
Reduced Power Cost Est. (efficiencies realized) $2,400 (10% x $24,000)
Total Est. Reduction in Water & Power Cost $92,858 / annual
Option F
Total irrigated turf following reconfiguration: 91.5 acres
Water use reduction based on new irrigated acreage: 32%
Approximate area of reconfigured course with new irrigation system: 58 acres
Percentage of irrigated Area with New Irrigation: 63%
Water use reduction of new usage based on efficiencies of new system area: 6%
(10% efficiency x 63% = 6.3%)
Water efficiency of new usage gained due to fewer leaks/breaks: 3% (5% efficiency x
63% = 3%)
Power efficiency realized with better watering times/duration: +12.5%
Conclusions
Reduced Water Cost Est. (effluent) $ - 0 -
Reduced Water Cost Est. (potable) $83,200 (32% x $260,000)
Reduced Water Cost Est. (potable efficiencies) $10,711 ([6.3% + 3%] x $115,200)
Reduced Power Cost Est. (efficiencies realized)$ 3,000 (12.5% x $24,000)
Total Est. Reduction in Water & Power Cost $96,911 / annual
Option G
Total irrigated turf following reconfiguration: 92 acres
Water use reduction based on new irrigated acreage: 32%
Approximate area of reconfigured course with new irrigation system: 92 acres
Percentage of irrigated Area with New Irrigation: 100%
Water use reduction of new usage based on efficiencies of new system area: 10%
(10% efficiency x 100% = 10%)
Water efficiency of new usage gained due to fewer leaks/breaks: 5% (5% efficiency x
100% = 5%)
Power efficiency realized with better watering times/duration: +15%
Conclusions
Reduced Water Cost Est. (effluent) $ - 0 -
Reduced Water Cost Est. (potable) $83,200 (32% x $260,000)
Reduced Water Cost Est. (potable efficiencies) $23,040 ([15% + 5%] x $115,200)
Reduced Power Cost Est. (efficiencies realized) $3,600 (15% x $24,000)
Total Est. Reduction in Water & Power Cost $109,840 / annual
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 73
APPENDIX D – REVIEW OF PROBABLE COST ESTIMATES
NGF Consulting has reviewed the probable cost estimates provided to the City for
reconfiguration Options A, D, F, and G. In order to objectively evaluate proposed budgets we
look for a baseline of comparison. The best resources are similar public sector golf course
projects involving reconfiguration. All golf course projects are unique, as are the conditions of
the site, construction costs, availability of construction materials (sand, proximity of sod growing,
etc.), and terrain. Additionally, in a situation where the proposed modifications to the course are
underway, as in this case, we look to other projects by the same golf course architect.
The best comparisons are three projects by Forrest Richardson, ASGCA:
Buenaventura Golf Course (City of Ventura, California)
Peacock Gap Golf Course (San Rafael, California – privately owned)
Olivas Links (City of Ventura, California)
The Buenaventura project was undertaken to rebuild an existing 18-hole facility originally
designed by William P. and William F. Bell. The scope was to largely retain hole corridors
through existing mature trees, but to re-turf all of the golf course. The project involved
approximately 88 acres of full re-turfing, greens rebuilding (19), new ponds (3) and complete
rebuilding of all features (bunkers, tees and fairways). This project had a stated budget of $4.5
million which also included site work for a new maintenance area, a new maintenance building
and improvements to the entry and parking areas. The work was completed in 2005 and was
funded by the City of Ventura through a capital bond program. NGF was told that the golf course
specific work totaled approximately $3.6 million and the market conditions at that time were very
similar to current conditions.
The Peacock Gap project was a complete re-build of an 18-hole golf course (also an original
design of William F. Bell), associated re-routing work for safety reasons, a new pond, new
drainage, full new irrigation system, and all new features including a new practice range. The
total acreage involved was approximately 94 acres and included similar naturalized area
development as has been proposed for Palo Alto. The project was carried out over two phases
beginning in 2004 for a reported investment of $5.1 million. Of note is that topsoil management
was very similar to that covered in the Palo Alto Probable Cost Estimates.
The Olivas Links project is most similar to Palo Alto among these three examples. This course
was originally designed by William P. and William F. Bell and also borders a river at its estuary
termination point. The course was prone to flooding and had very poor soil conditions as a result
of effluent irrigation and inherent salts by way of its seaside locale. Also a part of the capital
bond program of the City of Ventura, this 2006-07 work was contracted at $5 million in terms of
direct golf course improvements. These included full re-building using on-site soils. Paspalum
grass was used for fairways, with Bentgrass on the greens. Our estimation of the timing of this
work was that it fell during the most aggressive contracting time in the past 10-15 years. The
work appears to have been publically bid with six qualified bids, each very close to the lowest
bid at the $5 million point. The City spent additional funds to relocate and replace their
maintenance facility over and above the golf course construction contract.
Though there are variables that could affect cost, such as the ultimate timing of the project and
a change in regional economic conditions, NGF’s general assessment given our exchanges with
Forrest Richardson on this matter is that the probable cost estimates prepared for the City
(Options A, D, F and G) appear to cover the scope of the work shown for the options, and are
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 74
conservative in approach. According to representatives of the Golf Course Builders Association
of America (GCBAA) the Bay Area represents one of the most costly working locales in
Northern California based on available labor, housing and the general cost of fuel, operations
and logistics. We note that the architect, recognizing this reality, has included a significant
degree of project management and contingency in estimates prepared for the City - important
components that we often see omitted at this stage of planning.
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 75
APPENDIX E – POTENTIAL LONG-TERM MASTER PLAN IMPROVEMENTS
The tables below summarize some of the long-term and/or optional improvements that have
been presented by Forrest Richardson to the City of Palo Alto for consideration.
Clubhouse Improvements
Exterior Condition & Upgrades - Estimate: $250,000 Aesthetic improvement to facings, color, materials
Replace, upgrade landscaping
Expand Meeting Spaces - Estimate: $1,700,000 Current Space: 75 in one room + 70 on patio
Expand main pavilion room to hold 200
Expand/open patio to hold 100 additional (300 total)
Create outdoor wedding garden
Reconfigure grill as potential restaurant space (60)
Reconfigure bar as pub seating w/ patio for 60 addl.
Expand/improve kitchen
Expand/screen service yard
Expand/open patio to hold 100 additional (300 total)
Golf Shop Upgrades - Estimate: $100,000 Expand office/storage
Free-up 1,000 s.f. retail space
Create Cart Storage Building - Estimate: $440,000 Currently storage for 15 carts; balance kept outdoors and
leased temporarily as needed for groups
New building for 70 carts
Arrival & Entry Improvements
New Entry, Signage and Parking - Estimate:
$400,000
New entry
New signage
Resurfaced parking w/ Landscaping & Lighting (expand
to 300 spaces)
New Entry, Signage and Parking - Estimate:
$200,000
New trail connections (to Baylands, etc.)
Bike racks, signage, etc.
Practice Facility Improvements
Range Performance Center - Estimate: $500,000 New building & hitting bays for Instruction
Small meeting spaces and offices
Range Expansion - Estimate: $100,000 (6) Additional hitting bays (adjusted netting to north)
Rebuild Existing Practice Green - Estimate:
$180,000
New green complex as short game area
Create Designated Youth Area - Estimate: $200,000 Along Embarcadero (2 Acres)
Range Performance Center - Estimate: $500,000 New building & hitting bays for Instruction
Small meeting spaces and offices
Attachment E
National Golf Foundation Consulting, Inc. – City of Palo Alto Report – 76
Other “Alternate” Improvements
On-course Restroom Replacement - Estimate: $95,000 New structure and demo existing
Replace Balance of Irrigation System (Varies w/ Plan Option)Complete new system & control
Rebuild All Greens on Course (Varies w/ Plan Option)Rebuild all greens to USGA specs
Resod all Fairways on Course (Varies w/ Plan Option)New and consistent turf variety throughout
New Event Practice Green/Area - Estimate: $80,000 Separate event green and area (Plan D only)
Sand Plate New Fairways (Varies w/ Plan Option)Sand cap to 6 in.
Attachment E
Revenues FY2015 Projected FY2016 Projected FY2017 Projected FY2018 Projected FY2019 Projected FY2020 Projected FY2021 Projected
Golf Course Revenues
Green Fees (Incl. Cards)$2,341,500 $2,510,600 $2,680,900 $2,707,800 $2,734,800 $2,762,200 $2,789,800
Cart Fees $311,400 $332,300 $353,900 $357,400 $361,000 $364,600 $368,200
Driving Range $353,400 $377,400 $401,900 $405,900 $410,000 $414,100 $418,200
Tournament / League Fees $2,200 $2,400 $2,500 $2,500 $2,500 $2,500 $2,500
Other $12,000 $12,700 $13,700 $13,700 $13,900 $13,900 $14,200
Total Golf Course Revenues $3,020,500 $3,235,400 $3,452,900 $3,487,300 $3,522,200 $3,557,300 $3,592,900
Concession Payments
Food and Beverage Concession
Variable Portion $56,600 $60,400 $64,400 $65,000 $65,700 $66,300 $67,000
Utility Payment $26,900 $26,900 $27,400 $27,400 $27,900 $27,900 $28,500
Total From F & B Concession $83,500 $87,300 $91,800 $92,400 $93,600 $94,200 $95,500
Pro Shop Lease
Merchandise (4%, 5% FY15 ‐ FY21)$36,125 $36,875 $38,375 $38,375 $39,125 $39,125 $39,875
Total From Pro Shop Concession $36,125 $36,875 $38,375 $38,375 $39,125 $39,125 $39,875
Total Gross to City $3,140,125 $3,359,575 $3,583,075 $3,618,075 $3,654,925 $3,690,625 $3,728,275
Operating Expenses FY2015 Projected FY2016 Projected FY2017 Projected FY2018 Projected FY2019 Projected FY2020 Projected FY2021 Projected
Salaries & Benefits $158,600 $165,700 $173,200 $181,000 $189,100 $197,600 $206,500
Green Fees $117,075 $125,530 $134,045 $135,390 $136,740 $138,110 $139,490
Range Fees $70,680 $75,480 $80,380 $81,180 $82,000 $82,820 $83,640
Cart Fees $62,280 $66,460 $70,780 $71,480 $72,200 $72,920 $73,640
Club Fees $14,000 $14,000 $14,000 $14,000 $14,000 $14,000 $14,000
Fixed Lozares Management Fee $300,000 $300,000 $300,000 $300,000 $300,000 $300,000 $300,000
Merchant Fees Reimbursement $42,300 $45,300 $48,300 $48,800 $49,300 $49,800 $50,300
Contract Maintenance $829,552 $798,040 $805,177 $815,967 $826,901 $837,981 $849,210
Repairs & Maintenance $22,300 $22,600 $22,900 $23,200 $23,500 $23,900 $24,300
Advertising & Publish $30,000 $17,000 $17,300 $17,600 $17,900 $18,200 $18,500
Supplies and Materials $45,100 $45,800 $46,500 $47,200 $47,900 $48,600 $49,300
Water Expense $183,000 $188,500 $192,300 $201,000 $210,000 $219,500 $229,400
Palo Alto Golf Course Revenue / Expense ‐ Option G
Updated with Negotiated Contract Terms
ATTACHMENT F
Palo Alto Golf Course Revenue / Expense ‐ Option G
Updated with Negotiated Contract Terms
Operating Expenses FY2015 Projected FY2016 Projected FY2017 Projected FY2018 Projected FY2019 Projected FY2020 Projected FY2021 Projected
Other Direct Charges (Incl. Electric)$41,500 $42,100 $42,700 $43,300 $43,900 $44,600 $45,300
Indirect Charges $104,100 $105,700 $107,300 $108,900 $110,500 $112,200 $113,900
Total City Operating Expenses $2,020,487 $2,012,210 $2,054,882 $2,089,017 $2,123,941 $2,160,231 $2,197,480
Net Income From Operations (Loss)$1,119,638 $1,347,365 $1,528,193 $1,529,058 $1,530,984 $1,530,394 $1,530,795
Non‐operating
Income from Sale of Property
D/S Income $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Non‐operating $25,700 $25,800 $25,900 $25,900 $25,900 $0 $0
Total Income (Incl. Non‐operating)$1,145,338 $1,373,165 $1,554,093 $1,554,958 $1,556,884 $1,530,394 $1,530,795
Debt Service $428,200 $430,800 $423,200 $432,300 $431,200 $0 $0
Payment to General Fund $0 $0 $0 $0 $0 $0 $0
New Debt Service $351,300 $351,300 $351,300 $351,300 $351,300 $351,300 $351,300
Operating & Capital Reserve $234,200 $251,100 $268,100 $270,800 $273,500 $276,200 $279,000
Cost Plan Charges $46,700 $48,100 $49,500 $51,000 $52,500 $54,100 $55,700
Total Debt / Other Charges $1,060,400 $1,081,300 $1,092,100 $1,105,400 $1,108,500 $681,600 $686,000
Updated Net Income or (Loss)$84,938 $291,865 $461,993 $449,558 $448,384 $848,794 $844,795
FY2015 Projected FY2016 Projected FY2017 Projected FY2018 Projected FY2019 Projected FY2020 Projected FY2021 Projected
A. Updated Net Income or (Loss)$84,938 $291,865 $461,993 $449,558 $448,384 $848,794 $844,795
B. Original Net Income or (Loss)$34,400 $198,200 $362,700 $348,600 $345,100 $743,300 $736,900
Savings to City (A‐B)$50,538 $93,665 $99,293 $100,958 $103,284 $105,494 $107,895
Estimated Savings from Original NGF Figures
ATTACHMENT F