HomeMy WebLinkAbout0132.092(D: ... • •
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January 30, 1992
THE HONORABLE CITY COUNCIL
Palo Al~o, California
Golf coyrse Master Plol!L_~_[) __ f!velopl:lent
Members of the Council:
REPORT IN BRIJ:..1.:
FOR STUDY SESSION
IMOSDAY, FEBRUARY 3
The purpose of this report is to provide inf,'~rmation to Council for
discussion of the proposed developmen~ of a master plan for the
renovation of the Palo Alto Municipal Golf Course.
BACKGROUND
The Palo Altc Municipal Golf Course 'Was constructed in the mid
1950's in the Baylands area, a former salt marsh area that is below
sea level. Since its inception, the Golf Course has been plagued
by poor turf and landscape quality due to the extremel:y high s~lt
and sodium content of the soil, the high salt watp.r table and the
volume of play. OVer the last decade, the Golf COiJrSe has been one
of the most successful municipal courses in the Bay Area. This has
not only impacted the Golf Course, it has also affected the
regtaurant, golf shop and parking lot. These faciliti€s ...... ere
reconstructed in the late 1970's, but are no longer sufficient to
accommodate the heavy, demand of the Golf Course's customer base.
In the last two to three years, the aging infrastructure, urought
related turf, soil and tree proble~s, a~d ongo:ng heavy use have
caused the .::ourse to deterior-ate and made it IT't:Jre and more
difficult for staff to provide a qual ity experience at the Palo
Alto Municipal Golf Course. At the same time, neighboring golf
courses have undergone some extensive renovations and added ne~
facilities to enhance th~ir operations. If our direction is not
changed, some of the problems at the Gal f Course ""ill become
irreparable and the course use 'ioo'ill decline, creating critical
financial problems.
With t-h~se issues in mind, staff has been investigating
improvements that are needed to maint.ain a quality facility and
that will meet the heavy Use demands.
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JanUdr)' 30, 1992
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In 1986, the firIrI of John Brooks Boyd/Robert R. ,Jenks Associates
was retained to prepare a concept!..lal study for ipprovements in the
clubhouse area (Attachment A). ".I.'his study recommended increased
parking and seating capacity to enable the tenants and the City to
meet the increased customer deman:is, provide better service,
improve limitations in the fi:!cility and provide greater revenues to
cftset costs of operations ar.d capital imprc,·,Cer.lent needc that are
required to ke~p this Golf C~urse competitive.
In 1988, Sherman, Johnson Associates co~pleted an evaluation of the
irrigation system (Atta~hment S). ~ith a recommendation for
replacement due to aging infrastructure and inefficient operation;;;..
A replacement systell! .... ould reduce the water demand by the Golf
Course and increase the pot.ential of u~ing reclaimed -.. 'ater I .... hich
'Will be available to the Gal f C01JrSe in lat.e 1992 ~ With the advent.
of reclaimed water usage, it is essent.ial that. a project be
implemented addressing the high salt problems in the soil Which
caused the pr~vious reclaimed water project in 1976 to fGil. Staff
has developed a proposal that .... i11 add a sand base to the tairways
to enhance turf grass gro""'th and provide adequate drainage 3nd
leaching of salts,
In 199.1, a Golf Course capital Project Feasibility Study (nm.
295:91, Attachment C) \o.'as undertaken to determine if a capital
program to meet the Coursers needs .... ·ould be financially feasible.
The study explains in detail the past history and current problems
at the Golf course. It concludes that renovation is necessary to
keep the Golf Course viable ane competitive, and that such a
project can be paid for by revenue bonds .... hich can be repaid by
futUre Golf Cours~ income, It reco~~ended that staff advise the
City Council to proceed .... ·ith the hiring of a consultant to prepare
a master plan that "'Would clearly plan o",J.t the scope ar.d full costs
of the proposed renovation. Without this project, the Golf Course
will continue to have increased :maintenance problems; ope!'"ational
costs will accelerate; customer dissatisfaction ~ill increase; the
customer base will diminish; and, eventually, the Golf Course
revenue picture, 'Which has been po'Sitive durirlg the 1980's, coul.d
reverse. As in all businesses, we need to continually improve our
facilities and services in order to maintain a quality service and
retain our customer base.
DISCUSSION
Staff has analyzed the recommendations in the Feasibility stUdy and
has presented the findings to the Golf Advisory Con~ittee, which
represents the five active golf groups (I Senior group, 2 Women's
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January 30 1 1992
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9-iiole groups, 1 Women 1,S 18-Hole group and the Palo Alto Gelf
Club, 1 the public at large l and to the Golf Course !jonprofit
C-orporation Board of Directors, ","'ho oversee the current bond
indebtedness. Both the Golf Advisory Committee and the Nonprofit
Corporation are 100 percent supportive of the plar.ned improveme.nts
~nd feel they are long overdue. (See Attac::unent D)
Staff is proposing a long-term Golf CO'Jrse Renovation Project that
~ill include the follo~ing:
1. improvement of turf conditions
2~ r-eplacement of ~he aging and inefficient irrigation.
system
3. installaticn of a system to allow use of reclaimed 'Water
4. improved parking and clubhouse/pro shop facilities to
accommodate the increased usage and enhance revenues
5. completion ci the cart path system
6. course modifications to improve. drainage, play
circulation, safety and maintenance
7. use of modern technology
It is anticipated that t~a years will be required for the master
plan, environmental assessment and design phase, and another two
years for-construction. Staff anticipates completion during the
1995-96 fiscal year. During the two year construction period, 50
percent of the Golf Course will be shut down each year. As a
result of this closure l the play and revenues for the Golf Course
will be reduced by at least $350,000 per year. Ho~everr the
revenue reduction could extend longer than the t~o years because
the closure will cause some erosion of the consumer base and there
'Will be a time before that can be rebuilt. It is hoped tha't all
the play will ret).;.rn 'Within t~o years after completion of the
project; hO'wever, we cannot accurately predict ..... hat the revenue
losses will be. Staff anticipates that, if everything goes well,
the Golf Coun;e will be operating in the black, including paying
back the new bonds, within five years after the start of
construction.
On Monday, Februa'ry 3, 1992, staff 'Will m.eet ..... ith the City council
in a study session to further elaborate on the Golf Course
conditions and the plans staff has to improve them~ The agenda
will include a discussion of the 19B6 conceptual study of the
Clubhouse area, the 1988 Irrigation St\.ldy, the 1990 Financial
Feasibility study and the approach staff proposes to take ~ith this
project and how it will be funded.
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J'anu~ry 3C, 1992
Page Four
If the City Council feels staff should proceed ~ith this project,
'We .. -ill return to council requesting approval of the preparation of
a Golf Course Master Plan. This plan ~ill more clearly define the
scope of work and develop an accurate cost estin:ate of tt'.at · .... ork.
In conjunction ..... ith the Mas,.ter Flan preparation, -.. 'e ... 111 ~_lso be
preparing an environmental assessment for this project.
Respectfully submitt~d,
Paul Dias
Director of Parks & Golf
~]~{(.
-----Paul Thiltqen
Oirector of Community services
City Manager
Attachments: John Brooks Boyd/Robert R. Jenks Associates
Cor.ceptual study
CMR: 132 ~92
Sherman, Johnson Associates Irrigation Evaluation
Golf Course Capital Project Feasibility Study
Let~er fro~ Golf Course Corporation
Aat] Lt
Jc+t"" BROOKS BOYD:' ~09£r~ .JENKS ASSo.:LA.TES
'-'
Attachmer,t A
SE.PH,I-tBER, 1986
PALO ALTO GOLF COURSE ~~O CLU8~Oi)SE ADDITIONS A~D HOD1FICATIONS
THE FIRM OF BOY~/JENKS ASSOCIATES~ ARCHITECTS IS PLEASED TO PROVIDE
THIS CONtf.I"TlJAl.. KASTER PLAN AND ~EPORT FOR ""IOD1F-IC.e.TICNS. TO iHE
MUNJCIPAL GOLF CLUBHOUSE FACillT' AND ITS ~DJACfNT A~EAS.
AN ORIGINAL SCOPE OF WORK WAS OUTLINED 8y T~E DEPARTMENT OF RECREAT]ON.
SU8SEQ~ENT MEETINGS ~IT~ PAUL T~iLTGEN OF THtT CEPARTMfNT AND PAUL OIAS
OF THE GOLF COURSE STAFF WERE INSTRUM~~TAL IN THE FOLLOWING ANAL¥SIS OF
PROPOSED CHANGES AND RELATED BUDGETS,
IN ADDITION TO THE ABOVE, aOYD/JENKS HAVE CONSULTED WlrH MR. DON KNOTTS
OF ROSERT TRENT JONES II. GOLF COL.'RSE ARCHITEC1'S .. A.ND MR. RICH.ARD GOM
OF EARTH SYSTEMS. GEOTECHNICAL CONSULTANTS. .
STUD1ES Of VAR]OUS SERVICES INCLUJED IN THIS ~EPORT AN~ DRAW1NGS ARE:
A. EXPANSION OF PARKING LOT, STUDY FOR N~W ENTRANCE AND AN
ADDn IONAL EXIT.
B. ASSOCIATEO LANDSCAPING.
c. EXPANSION OF KITCHEN AND DIN1NG ROOMS.
D. EXPANsrON:OF BAR FACILITY.
E. DRIVING RANGE TEE EXTENSION TO E4ST.
F. POSSIBLE LIGHTING OF DRIVING RANGE FOR N1GHT USE.
G. ADDING A NEW SMALl.. PUiT!NG GREEN NE~,R 41 TEE.
H. EXPANSION OF EX1STING PUTTING GREE~.
1. PRO-SHOP EXPANSION.
THE CONTINUED ANO GROWING SUCCESS OF THE ~UNICIPAk GOLF COURSE AND
CLUBHOUSE FACILITIeS HAS PR~SENTED OBVIGUS NEEDS FOR ITS EXPANSION
AND UPGRADE OF CERTAIN AREAS. THE CLUBHOUSE AND PRO-SHOP WERE BUILT,
AND RENOVATiONS TO THE COURse GOLF MA~E. lN 1978.
WITH THE COMBINATION OF APPROXIMATELY IODiOOD GO~f ROUNDS PLA¥ED PER
YEAR A.ND THE GRO"'ING DPnNG DEMAND, THE ENLAR.GEMENT OF THE -CLuBHOUSE
FACILTfY JS ADVlSABLE. LARGE BANQUET REQUESTS, FROM PRIVATE AND GOLF
R.ELA.TED ACT!'V)TIES, ARE PRESEN1LY NOT HANDLED FOR LACK OF ACCO~DDA1!ONS}
AND THE E.ISTING PARK1NG LOT IS UN~BLE TO HANDLE GOlFERS AND LUNCH
BUSINESS SlMUlT~~~OUSLY. TrlE SOLUT10N OF THE TWO CONDITIONS A50VE~ IS
TO eXPAND THE OrNING AND 6~R FACJLITy fROM THE FRESEr.T 130 SEATING
CAPACITY TO (~) 225; AND EXPAND THE PARKING FACILITY FROM THE pRESENT
213 TO APPR.OX:ll"'cATEL'( 3-E.5 CA~,S THAT COuLD BE ULTIMATELY HANDLED' UPC'N
COMPLET I ON OF PH.;.,SE I AND PH,,:,SE I I . .'
ME"I.'BER OF H,E AM:: ;=tICA.N I/I,'STIT~H OF A~C~"PTECTS
-,
l~ADEQUATE ACCO~MDPAT10NS AN~ CON~lTI0NS iN OT~ER AREAS A~E:
A. KITCHEN: D1SHWASHING SPACE ANO FOO) PREPA~ATION SPACE ARE
T00. JlGHT TO A:C't~,MODA1f ~;:'OPOSE::' :;!~lI"'G EXPANSION.
8. G~~ASe TR~P ANO SEWER LJ~ES I~ADEQ~ATf.
C. SNACK WINDOw: GOLFE~S ~fEO QUIC( PICK-UP FOR SNAC~S WHEN
P~OCE~DING FRO~ 9TH TO lOiH FA1RWAY wITHOuT EN!ERI~G HA1N
EATING AREA.
O. PRO-SHOP; STORAGE AND MERChANt!SE· DISPLAY ]S TIGHT.
E. OR.I\iING RANGE: HORE. TE-EiNG AR.EA. IS DES1~~.BLE ANO EXISilNG
DRIVING RANGE TEES COULD EXTEND EASTE~LY APPROXIMATELY 30 FEET.
F. EMERGENCY AND SERVICE VEH!CLE PARK!~G FOR KITCHEN STAFF SHD~LD
BE EX~ANDED.
SOLUTIONS A~D REMEDIES ARE SCHEMATICALLY S~~~N ON T~e ACCOMPANY]NG
DRAWINGS. CONSIDE~AiIONS FOR CONTINUED OPE~ATIO~ OF T~E CLUBKOUSE A~D
THE SURROUNDING AREA INFLUENCED THE AD~ITIONS AND CHANGES~ HOWEVER,LONG
RANGE GOALS AND EfFECTIVE COSTS WERE PRIMARY IN THe FOLLOwING
RECOMMENDATIONS:
.A. PARKING LOT FEATURES:
J. ADDS 86 CARS FOR PHASE I.
ADDS 55 CARS fOR PHASE II.
2. PHAS~r I PARKING WOULD ElI~INATE MUCH OF THE LAWN
MAINTH .. ANCE A,REA PROBLEM S:ErwEEN Tt'"E. E)(ISTr~~G GREEN
AND THE PA~KING lOr~ THE GRADE OF THIS AREA IS TOO
LOW WHICH AllOWS liATER TO COLLECT r~ WINTER AND fROM
LAwN SPRlNKLING.
3. PROVIDES PASSENGER LET-OFF AND P]CK-UP SPACE AT WA~~WAY
ENTRIES 1 A CON'lE.NI:NCE FO:/ e .. \NQUE·'-S~ PARTiES, ETC.
.... PROVIDES NEIo.' l'EXIT -R!GH"T TURN Or~lyl' O~,rO EMBARCADE;:tO
ROAD. N'='W "ENTRANCE" IS NOT RECOMl"END~~ AT THrS LOCAT10.~
ALONG EMBARCADERO DUE TO HAZAR~ OF CROSS OVER TRAfF1C.
5. Rf-ALIGNS PARKING STALLS Ai WEST END OF EX1STING PARKING
LOT TO ACCOMMODATE 10 ADDITtONAL CARS.
E. lMPRO~ES SERVICE AND ~lTCHEN EMPLOYEE PARKING AND ACCESS.
7. P~ASE II WOULD RETAIN AREA FOR EXTENSION OF EXISTING
91CYCLE PATH. wH1LE RETAINING ALSO A GREENBELT AREA AL0~G
THE EMBARCADERO ROAD.
t B. AS SOC! ArEC LANDSC.t..P 1 f.JG FE,t.J~~E_~: . . .
2 •
ADO TREES IN Ex]STING PARKI~G LOT TO CONFORM W1TH C!TY 0=
PALO ALTO PARKING LOT STANOARDS.
REDUCES LAWN AN~ M~INTENA~CE COSTS ALONG PARKINS LOT I~E~R
EMBARCADERO ROAD.
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.. C~ IUTC.,EN ANCJ Ol~)_~·K;/I'-',E.ETP1G '<O:l ... ·.S FE.A,~:
1. E~LA~GES (lICHEN ~D ENrlOs~ ~X15Tl~-~~CK ~~CILITY
JHEqEBY INCREASING'FOOO p~e~AqA110~, ,EA JNO DlS~~ASHING
f,Q.CJLITY. (ONST~UCT '~EW DOCK LOADI',,,, AN8 UNlC~,~ING.
2~ lNCREASES SEATING C:"PACfTY F~OI-\ 104 1'0 152 1N /",.&lIN D!NH:(;
AR=:A'4
3. BANQUET ,t.,CCD.~OD.ATrm.;S WCJLD BE INCREASED ... "':"HER::51
IN~R£A.SING T!o1E N!GIi1 Tn/,E "JSA'S-E AND LUNCH CRi)WDS.
~. NEw BANQUET OR EATING SPACE l~ CON~EN1E~T 10 EXISTING
KITCHEN FOOD SERVJCE ENTRANCE.
S. ROOf LINE EASILY EXIENDED FOR K'TCKe~ ANC DINING ROOM.
(EXTENSION OF OINtNG ROOM WESTf~lY TOWARDS 9TH GREEN WAS
STuDIEO. WHfLE THIS SOLUTION WOULD Be P~~C'!CAL FOR LUNCH
SITTING, IT IS NOT PRACTICAL FOR eA'QUET NEEDS. THE
EXIST!NG COLUMNS ON 1rlE w~ST WALL AND HVAC UNITS ARE
EXP~N5fVE TO DElET~. 'DEPRESSED FLOOR WOUlJ BE NECESSARY
TO MAINTAIN ADEQ~ATE HEAD ROOM IN TH!S EXTENSION, TKERE
fORf. eXTENSION wESTeRLY IS Nor A P~EFERR~D EXPANSION.)
6. DINING OPENS TO EXPANDED BAR ALlC~lNG MORE FLEXlSll1Tv
FOR D1NING EXPAN~ION. NEW SLIDING DOORS COULD Bf CLOSE]
WHEN SEPARATION IS D!SIRABLE.
10. BAR -INCREASED C"PAC I n FROM~. TO H SEATS:
I. OPENS TO EATING ROOMS.
2. PRov;r'bf PASS-THROUGH WI~DDH TO NEw DECK AREA FO~ Q:J1CK
PICK-U~ SERVICE FOR GO~FERS PROCEEDING TO THE 10TH TEE~
_E. DRIVING RANGE EXTENSION:
1. 30 FOOT EXTENSION EASTERL~ IS vlA5~~.
2. ALLOWS MORE TuR~ tN FRONT OF TEE W~JCH ACCOMMODATES BETTER
ROTArlON OF IHE TEE.
1. EXTEN~ING THE RANGe ~OUL~ IMPACT THE 10TH TEEI THEQEFCRE
THE ADDITION OF HIGK fENCE SHOULD BE SIMUL1A~EOJS.
~F. DRrvrNG RANGE LIGHTS:
(INCLUSION Of THIS JTEM IS ~OT NECESSARILY A RECOMMENDATION
FOR lMPLEMEN1AilON.)
I. NIGHT L1GHTING COU~D EXTE~D USAGE Of RANGE. THE PRUNEYA~D
DRIVING RANGE IN CUPERTINO HAS IN$TALlEJ LiGHTS. A~~
EST1KATES TH,~,T 4DI OF -'S'::RS ARE AFTER 6 PM. TKE ESil."",,~TE
FDR PALO ALTO MAY SE SUBSTANTIALLY LOWER .
• G. NEW PUTTING GREEN NEAR TEE 'I AND EXTENSION OF EXISTING GREE~:
1. GOLFERS WAllING AT II TEE WOULD MAKE USE OF SUCH A GREE~.
DON KNOTTS OF ROBERT TRENT JONE~ STATED, THAT THEIR
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INCLrNAT!ON WOULD BE 10 (EEP ANC EXPAND THE EX1STING
P~ACI1CE G~EEN WH1CH ?ROVIDES A 8EA~T!FUL CPEN lA~DS:AP~
ARE~, NExt TO THE' C"i..·U8~D:"SE. HE ___ OULD RA"!'HE~ SEE Tr:E
tlT~ SPEND ~ORE MONEY ACOING A NEW GREEN NEAR THE 1ST
TEE AND IMPROViNG THE DRIVING RANGE RATHER THAN SPE~D!~~
ADD1TrONA~ MONIES RELOCATlNG AN EXISTIN~ HEAVILY USED
PuTTll'fG GREEN.
THE CONS1DERA1IO~ Of RELOCATING THE EXISTING FU1TING GRE~N
WAS IF THAT AREA COuLD BE 3ETTER WSED FOR ADD1TI0'IAL
PARKING. THESE STUDIES NO~ I~DIC~,TE ADD1TI0NAl PARKING
CAN BE ACCOMMODATED WITr-!OUT Trlf RELOCATION OF ThIS G~EEJ.;,
IH€. .A.TT~,C:I1EO PLAN.S SHQW THE EXiSTP~G P:.J1TING GREEN eNLARGED
TOWARDS THE ClU8HOUSE~ WITH A POSS1BLE SMALLER P~TTING
GREEN INSTALLED NEAR THE 1ST TEE.
IN ADDIT10N} THE EXISTING GREE~ HAS BEEN EXTENDED TOwARDS
EMSARCAOERu AND A SAND T~AP ADDED TO AllOW FO~ PRAC11CE
PITCHING.
;H. EXPANSrON OF EXlSTtNG ~RACT1Cf PUTT1NG GREE~:
1. PRoposeD exPANSION IN EAS1ERLY AND WESTERLY D1RE(TIO'
COU~LED W!TH PHASE r PARKING ELIMiN~TES AN EX1STING
DRAINAGE PROBLEM. THE PHASE 1 PARKING HAS BEEN wCvE~
AROUND EXIST1NG MATURE T~EES A~D A NEw ACCESS WALK HAS
BEEN AC~cO FROM 1HE ?ARKING LOT 10 THE ClUSHOUSf. THe
OVERALL PROPOSED CHANGES WOULD ENHANCE THE OPEN SOACE AND
EL1M!NATE PEDESTRIAN TRAFFIC CliTTING ACRCSS THE EXISTING
LAWN .AREA.
11. PRO-SHO~ EXTENS10N FE~TURES:
BUDGET
I. EXTENDING THE PRO-SHO~ TOWARD TH~ 18TH GREEN WOULD ALLCW
8El!~R COURSE CONTROL fOR THE STARTER AND MORE SPACE fO~
MERC~AND1SE DISPLAY.
2. EXTENDING THE EX1SlING STO~AGE RDO~ NOR~HERLY ~8UL~
DOUBLE THE EXISTING STORAGE SF~:E.
BuDGE.T CONSIOERATIONS IN ORDER OF :-~E A8;)',"E ITEJo':S ARE:
!A. PAR~ l NG LOT (PhASE I):
1. TRANSFORMER AND TELEPHONE BOX RE~OCATION
2. SIDEWALK AND SPRINKLER PIPE REMOV~L
3. CLEARING AND STOCKPJLE
~. FINISH GR~DING
5. PAVlNG 28, DOD 5Q.FT.
6. NEW EXIT TO EMBARCADEPO R2AC INCLUDING
STORM ORA!N CULvERT AN~ CuRB CUT
7. 300 FT. X S FT. WALK AT PARK[NG EDGE
B. MISC. HEADERS} STRIPH~G, ETC.
9. B1C¥CLE PATH EXTENSION-AFFR0X. 260 _IN.FT.
10. 3 POLE LlGHTS
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2. G 0 C' .
4,50J.
.:;. , 0 :::: .
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2 , 6 8 ~ .
3, .: ~ : .
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tA. POR.1M; lOl (PHASE II)
1. CLEAR[NG A~O FIlL.~650 CU.YDS.)
2~-'FINISH GRAD1NG
3. PAV!NG lS~OOO SQ~FT.
It. BICYClE PATH EXTENSI01~-APP~Ox. 300 LIN.FT.
S. MISC. H~ADERS, STRIPING, ETC.
lB. ASsOCIATED LANDSCAPING
1. 27 TREES IN FARK1NG LOT
2. SPiUNKI..E~ REVISIONS, SEEDING, ETC.
!. CUTT1NG AND ~EPA!R OF E~lSTING AC~
PAYING TO ALLOW T~EE PLANTING
It. LARGE SHRUBS ZOO-~ GAL.
5. SMALL 5H~UBS 100-J GAL.
te. KITCHEN ADDITION
1. SiRUCTURE-200 SQ.FI. ADDITiON
AND MISC. JTEMS
2. DOCK EXTE'SION-10~ SQ.>T.
3. NEW SEWER LINE -LIN. FT.
4. KITCK,!'N EQUIPMENT cer OTHERS)
DINJNG ROOM ADD1T10N
I. ADDITION-560 SQ.FT.
2. RflOCATE HVAC UNl TS
3. FuRN1SH1NGS ALLOWANCE (INC. C~~?ET)
to. BAR EXPANSION
1-AOvIHON-S28 SQ.FT.
2. WOOD DEC~S, loll NO SCREEN A."-D S T E P5
450 SQ .FT •
3-SAR REMODEL (CASI"ErRr, ETC. )
tEo DRIVING RANGE E~TENSION
1. ExTENDED GRASS AREA
2. flLl
3. HIGh FENCE EXTENSION
-5-
$~JOOO.
2.5ao~
22~5c.J.
3, {IOO ..
2, oo __ ~
$ 2,700.
5, DOO.
2,500.
4,000.
I, ODD.
520, DOD.
5, tjJ a .
4, 0 aD.
$55,000.
10,000 ..
-•.. --
$52 J C
15, !Joe-.
~~· ___ o.
$ ~ ... 0 oJ,J ..
2,500.
2,000.
~32.00Q.
515,200.
129, DOC.
S6F.,OOD.
575,000.
8,500.
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.~. OR1VlNG ~ANGE LIGH1I~G
1. METAL Ht~Ll?E FrX~~RES INCLU~]~G POLES
2:" POLE ur-i:;ERGROIJ'~C \o.'IRiNG F~O,~: CITY SCI~'~,(f
$ 8~ D8D.
.2..t. £!Q..:.
DOUBLE DECK1NG OF ORIvlNG RANGE WAS INVESTJ~ATED~ HO~~'{ER
FIvE F~CTORS AG_!N5T DOUBLE DECKING ARE PRESENTED 5ELOW:
I. ADDED Ll~eIlITY DUE TO SALLS BEING HiT [NrO EMBARCADE~O ROAD.
2. ADDED LIABILITY DF INJURY Dl)E TD STAIRS ... ETC.
3. THE fACTOR OF AESTHET I CS.
4. PRDeABlE REST~ 1 (T ION TO USE OF 1 RorJS ON~'" ON UPPER DECK.
S. HIGHE~ fENCING WOULD BE NE.CE.SSA~Y.
fG, NEW PUTTING GRE:::N @ TEE ~I A~D EXJENSrO~' OF EX1STrNG. FurT!~G GREEN
I. THIS MIG~T BE CONSTRUCTED BY STAFF
IIH. EXTENSION OF E.XIST!NG PUTTlrJG G;;:.EE~ ANJ ~'EI<iI' 5A;JD TRAP
II. PRO-SHOP EXPANSION
I. FRD~T EXTENSION-270 SQ.FT. $30,000.
2. REAR ~INVENTORY) -150 SQ.FT. ~~
• J. FIRE SPRIN,I(LERS (RETROFIT OF CLUE:HOUSE)
CITY OF PALO ALTO FIRE DEFARTMENT WOULD NOW REQJIRE
THE CLUB~DUSE AREA TO BE RETROflT WlTH SP~lNKLERS -
5400 SQ.FT. (P~O-SHOP IS EXCLUDED DUE TO lTS
SEPARATION ~ND LIMITED SlZE.)
TOTAL ESTI"",,AT,:
CONTJNGENCI~S. ETC.
ITEM COSTS wILL VARY AND IN FACT BE LESS OR M~RE
DEPENDING ON TME MAGNITUDE OF wORK TO 8E. H~lT1ALL~
DONE.
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$45,000 .
$25, ODD.
$SQ, 000.
.
THE PROJECT
Description
~ city provides a wide range of conumIflJty se.n1ces including a golf course
to serve a growing golf market. The site of the golf course complex is located
in a fonner marshland area, howevCT. Cl.!'.d has been plagued by poor turf and
landsioape quality. The site is below .ea level. Accumulations of salt and other
substances naiUIal to the area have resulted in course deterioration as well as
an increase in maintenance and repair costs. At the same time, new or reno·
vated courses iocated nearby are cornpetL-:rg for the same recreational revenue.
These conditions reduce the revenue potential of the course as well as the pro
<>,op and restzurant vend"",. Golf course operations are generally se]f·supporr.ng.
The publi< is willir.g to pay for facilities wirh good playing cenditions and ameni
ties such as adequate parking, driving range, restaurant, and other facilities.
Potential fee increases and vendor rent inc1eas~s are dependent upon facility
improvements,
Two projects have been proposed to address these concerns:
Project 1 -Full Re--OllSUUction of Course and Sports Complex: The concept of
this project wowd entail develop",en! and implementation of a master plan [or
ccnvemon of approJrimately 25 acres ;"ro a lighted mwtipJe sports complex.
This complex will include fields for scftb&ll activities plus off-season use for
socoer, volleyball, or other recreation activities. The potential of lighted fields
would extend operations of both the golf shop and the restaurant operations,
The remaining acreage would b. reconfigured into a new championship golf
couzse and driving ra"ge to complete the package. This wollld entail complete
renovation of the current golf course and reconstnlcdon of the s.ite utilizing a
12 inch sand cap to provide penneable soil, raise the site above sea level, and
improve golf playing areas. A conceptual study completed in 1986 addressed
perldng, restaUMnt and pro shop expansion, irrigation and reclaimed water and
""oeated landscaping, This plan would be revised to include additional golf
can stor.age, increasing the size of the equipment rnaintena."lce repair facility
and potential increases in office space. All redesign work would take into con
sideration furore work proposed for ramng the levee at Francisquito G..-eek
The <cope of this projeot wouid entail closure of the golf course and golf shop
op<ntiOllS for a 2 year ConstruCtiGD period. Restaurant operations could con
timo, for non-golf custom"". For economic feasibiliry purposes, ca;lital costs
of the <ports complex portion of this project are separately identi.Sed and eX
cluded from costs to be funded from golf <o,-"e revenues.
I'Jojea 2 -Cour.se Renovation Only: This project would entail the develop
ment and implementation A a master plan for complete renovation of the golf
. <:OU,'Se and driving range complex, but would retain the existing hole configu
ration. All playing areas would be rebuilt utilizing sand base construction to
rais. fairway areas to sea level or above would provide adequate drainage and
pmneabiliry for reclaimed water u.s •. FairwaY" #lQ and #18, and Greens #3,
#10, #17 and #18 were rebuilt in 1976 to current sand technology standards
and would b~ utilized in their present configu;-otion. The sand based fairways,
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for mat~rial purpo::es. would be retained. The 1986 conceptual swdy wou.1d
be revised to include additional restaurai1.i and golf shop s.pacE.', additional golf
cart parkhlg. completion of golf can path system, equipment mainrenanc1! facil·
ity expansion, replacement inigation and reclaimed water co"""\e,uon Althaugh
this plan utilizes me existing confi~tion of the golf comp!ex., consideration
would be given to' poter~tial relocation of the Griving range and also realign
ment of Holes #12, #13, #14, and #15 as the future raising of Franci'quito
Creel< impacts these areas.
This prcpooaJ could be accomplished in phases (e.g., front 9/back 9) thus al·
lOwing partial operation during construction. Both the pro shop and the res
taurant would remain open.
Project Costs
Table 1 show. estimated costs fer both projects as follov.~ .
• Project 1 ......... _ .. _ .... _ ... _ .... _ .. .
• Project 2 ......... __ __ .. .. .. • .. .. .. .. __
$11,000,000
5,000,000
These costs include the golf course portion of the capital coSts necessary to de
liver l\lclaimed water from the citis treatment plant to the golf course. All CO'sts
attributable to use of the sportS complex in Prcject 1 (",timated at $1,515,0(0)
would be an expense of the par1cs department rather than the golf course, ",!d
would be paid from general funds of the city. '
Project cost data has been estimated by city staff from discussions with qualified
golf """"" arcliliects reguding = construction costs. Upon determination of
project feastbility, • logical next step would be d..velopment ef. master plan.
TA6LE I • CITY OF PALQ ALTO GOLF eCoRSE
PROJECT COST ESTIMATE
COUf1e rencv4tion~ irrigation
S.nd C4~
De.lgn
Project ~2
/'.;
tlubnoun 'f"'n,ociering. parking 1ct
Ctrt path, repair facility addition
RtC1A1Je4 ~tter pipe11ne CQst
C(Jnt~ngency
S 4,000,000'
4.000,0003
350,000
1.200,000
200,000
200,000
I,Q~O, 000 $11,0 b,ooo c
~ . Est1.ated tota.l
.' Ltss s~orts c~plex portion (25 ac~esj:
. ::".~. .Ma.rgfn.41 CO!;zt ruct j on cos ts
, 1.1 gilts
~ 81.lchers 1 becks tops
,~ Cont1ng!ncy
. Total sports c.omplex CClSU
~e~ goH course cost estiN.te
$ 1,100,000
150,000
120,000
145,000
1,5)5.000
" 9,485,OOO
1 .... Rac.ol'lf1grJr'e I!!ntirf. coune. atld sports ::omple;ll; (requires full course cto'i\Jre).
2 ~ Rettfn existing config~r.tion. renovate CO\Jrs~ (requires on1y parti.l
-.C clo,ure).
::?, 3 .. ~~Jncl udes. sports cMpl ex.
-~:' ~~r:ce: CH, RFP e.nd capital fl!l.provf!.me:nt program. Fropose.1 memorand.a,
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Tile main line piping aniliale.al plplnlllhroughoullhe 1"IOllion syslem musl be size' 11,.e e .. ugh Ie ban_Ie
'he IDlume 01 wale, requl,"lo IIIpply Ille amounlel p,eclpllallon n ...... keep lilt lUll .... n. Th, SOu. 11&,
.... reClul, .. betwoen 1.5 en 2.0 Inch •• 01 pllalpll.Uon PII w •• 11 • ., ... PlIIIIII.I ••• 11 ... ,..... lhl'
loclad ... VlllelflOlpl'lllaq 01 ...... "I (lurf wI,e. use and nlp •• IIIDn).
TIle 10111 w.terlng lime should Role.cud nin.1Iou11 per ilia, 10 IbalWlllriat .... III lIB. Ie ... rt Hlorelllrll
In lilt evening and II COmpltld "'ore uoH pllY llartlln lIIe motol ...
Tile dell,o 0' Ihe s,.I.m musl 11.0 ta'_ Inlo Iccollnl III. lerrlln 01111. Cd .... 1111II1II11 M prl,'IIII"'. " WIll
as piped wllllihe conlours lepa,allng 1'1' •• ,1101. Ipp,oach .. 10 ...... alii fln.,I. Ii,.... .... 1 .....
SIIpa,ate conllollll1lro", 1ll,wlYl/lee. In 0:1111 10 CGIIlral w.llIllIl •
Tlte Sprinkler hull. 111011111 hlw. a cileck ,alv. Ie pm,nlln ..... 11aI,. Of ..... " III WI ............... -
Tlte CORlnclion Dillie vavloll componenlall.mblles 01111. IJlllm .. ~ _ .. dlllll.~ In 1IId! a mann .. 11111
lIIake IIIllnlenance ollbe sysllm as easy ilnd Iconomlc:al '0 maillili. 1& pOllilll.. TIle ..... Ia. celt .,1IIe
syslem wilich Inclullollll"llIllnloCl. I.bo" w.ler Ind power cost, II1II11 III Clllllltleru.
lIelllole conlrol v,l"s 0, val •• -In-head sprlnklera slluultlilln 1III11t-1n , ......... II .......... 1811. ,,'IIU"
so 'he dlschl'" 0' each lIud Is .. llIlv." cOOlllnl.
Today'sSlal.-oI·the-anaoll cou,.el,rlgallon sy'tems Ire compuler conllolloll. A compule, sy~l.m willi p,oper
lIIanl,olllenlollers: 1) water, power and labo, savings ~) ultimllo ''''lbUlly ..... 1111 •• thl Sl!perlnl ..... nt 10
hawe preclSI control 01 his 0011 course IrrlOlllon w't',ln, 3) w,ler IIIId •• 1IrII .) pump ................ nltlfllli
anti mucn more. NI IIIls Is ."umlng 11111 the aprlnklll InlllllOIl .,.... II prOflll'ly llllipIc! .... lNlalia.
Inllllily.
III Older II ..... maximum conlrol on a"IOI Ind 'GII. "I,,-Io-llu ........ 11 ..... ~ III lMUliatl .... uell
Sprinkler held uoald be on .... , .. lion Dillie lIelel CGIIh'I".
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II Ih. abo •• Illn,'ud.d In ihe sysl.",. along .lIh proper Inliall.llon II1II,0011 IIIIIU ..... nI 01 UII rpIIm. iIII
result Is a luce'SII., .l1li .IIlclenl Irrll.llon ay.le", .nd • 1.111 ere ... 10IlNl,. ••
Aile, ""'uilllni .11 compiled dala galh.r" 10 dal. on llIe '.'llIn" Irrlg.tIon .,llIm lor Pale Alit .... IeI,.1 Goll
Course. lI.pp,,1S mo,' III 01 Ihe elemanl. 0' an IIIIIClenl.ncIlucc ...... ,lrrl •• II .... , ..... " ......... '.1111
lor ""n.gemenl olllIe aysl.m. The InelllCl.nl .,"1'" I .... " 1111111""10 liliiii .. ,.,.....
FoII'.'.g Is I '/IIIOIt on tile _Iulllon 01 lb. In I ...... prill ..... ,l1li hi. Alit ... .., GIll c.ae:
1. BACKGROUND
Th. nine (!I) ,eI'IItII loll cou .... malnl.nanA II.If IncludlS 1111 Goll Cou, .. S.p.,. ...... 'nl. Mr. P.ul
DIu. Th. rem"nlno .,,,hl (8' , •• 11 ",emller. Includ' II. maIAI.n'IA .. ra .... ' •••• siII.lc •• ~ I
sprinkler repair perMII. III aIII.,llon IwO (2) If IIIr .. (3' ,.rt·lI .......... ' III. IIIIIIM _ .. die
summer IIIonllll.
The .,'olll.IIe Inlg.,IDII SYli ... " Palo Allo Municipal Goll C.UI'll CGl\lllIa of. It.n." tvPllya'.m.
The orlmlnal'rrlpUon t¥slellJ Will. IIIanu.' q •• ek t:tIllplliiO .YII.", Inlllll ... '1 1.. n. Irrl"IIDn
syslem was .ulomat.d In 1963. In 1976 Ihe nu",b" 10 hole ....... ., 18 hD'. In~ 1IIr1Y1n. rlng8 , .. ,.
remod.,.d .m' II new ",.',m replaced Ihe e.isllnglllll." lya'e",. TIIt.lIgh.III ,ea,., l1li I,sl.m II ••
Deen .dded on 10 Irem lime 10 lime or "qulpmen'aD' wltlng repl.celll. In 1911 conlr.II" •• n. lalor"i
were also replaced.nd law voltagl 24 11011 .lrln, w •• rep'lced 11011 Willi .......... 11.,. MI ••
upllafed.
Th. Illsling Irrlg.llon syale", I •• lIane" type SYlle", Ind IItt sprinkler h.ad. Dperall II, l1lil1li of In
electrically lelulIle" remol. control valve which .Upp"" .ller III •• eh sprinkler he.llllllowlIIlI'lim DIllie
ReV. The remole elmlrol valv.s epera ••• 'eclrlca", " m.ansll"ow ,altil" .'rlllg frOlllea~ lIallln III
a controller. Some slallons on lb. contralle, canlrolll few ., Ilur "eadl .1 • 11m. I11III .1111' .... ,0115
conlrol sev.n '0 len lIeads per Slillioll. In Id.lIl .. 10 .... 1I1101ll1la •• fwo (2) III ....... (J) ReV'.
connected 10 one lillian 01 the Antroller.
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All llflClenlllfltllian aysIIm 011 a VOII WlISI UI ".111 GIlt I. '0111 .,ldIer •• , U •• 10 ... ReV 811
on, slalion .r • conlroller. How.ver 011 1111 Ifftptlon IYltItII 811 hili All. Mllllelllli IiDIl t\lllll •• ,am.
slalion. III" .. mlny .. ItII !IiIadl tlltllllclod I. 011. ReV. In .... 1111l1li ..... , _""" .11 I\IlII'I 11111.
one v • .". on mem ... III, IIDnlbll l1li. twfIIn ~ 1ftPI, IIIUa ...... a' ... u.e .. I PI'UcIIlar
COIIIrGller •
Tile,. Ire approxlmllely 2~ ReV'S wIIl@ collllO' lb. sprlllkier hellI.. 1'IIuI ReV'S .tt Rlill lir ..
Motel ffA-tP e"tctrlt valves. llley .r. hIuH.'" fUIa .. ,I".,.," HI ••
Sprinkler Itt." cOllelal 01 Rain Bird '41. lull tlJcll ,olor pop-ups, IXcept It, "JII'IIIIMI.ly iii POirt
Circles. Tllere 1111 I Itw 10'0 '63D', ami "6D·,. Th. fl"" uul, 1111 Is lA'r. 111, .. lit
IIpprolllllll'" 1850 'Dim ,." up Ipllnkl.,. (Rlin 1'111_1 ... ).
Tile .tlne ollhe 'prinli:lers WI'I del ermined II, Ihl orlllnil .Be row IIIIICII COltlllnt ",111m .rloln.lly
IIISIIU ... MdIIlOll.lI, .. ,.s wIre add.d 10 ,"end Ille .... 01 ''"1lII0I wllH 1II1p1tl11 •••• lIIIQled.
Spacin,_ I!II ,,,"lc. IIUt 'end to he IDO clos. I" IIIIIt CalIS. MoIllljl.lcl .... "" hta 61 fl •• t. iii .....
wllllume IJ ,., ., &Ii , .. lID 70 'OIl. 01 ........ II clO .. as 40 flt'tt 4S f ... .
Wind l,tlOf II mllllftlll, Mt 111l1li1' " CIIf\S'''''" 11I11Ie •• 11,11 JII' ..... It ct ... II • Jll'1'I,1I111 wlM
01 a to 10 MPtI trDm!lle HerIIIlrDm ,"''':00 p .... IdIUl12:11G ••••
Plplnt consists 014". ,-ami r AlbeslOs Ctm.1II Pili' (lrlllll",. ,p!lfillma"', 33 ,IllS DIO. At.IIOMI
m~ln lIMa allaHllnce III. IUllllnallnilall,.hIIt .,, PVC. The 111.,,1 plplntr Is ... lIV ,-,"'" iUId 10112"(
wid! ume 2") pvc t'.u 200 solvlnl weIll pip.. Ills lIifllull ........ mlna IUd 1»".. II ,Ipl. Ill, •• l1li
loullons III1C1us. Ih. "I-bll"!" ,1.11 11001 lot ~ •• I'''ralaID., I11III 'I ... WIIIt ~ .... ", ..
pljllnt tllCillona.
TM Operallon ot til, sprlllklDt Inlpa". S15"1II whlcb IncllllA •• till n"".r oC ilIl .. , .. I •• "'"Oil
opmln, tile lllimber 01 COIltrllllers operlflfll '1IIIIIIIIIIf IlIUi U. ... , II up ... .,.,.1. Is .....
0/1 • "mpuler prlnt-Olt In IhII appendl ••
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, ,~"/--",}( Fjl::i~)~·.·;·r.ilf'-~J::,~ ;,;~' ,I ~ -r:1 SItIce IIIe 1"".6l1li JYII8m WlII.ded illite .11I1 .... nl U .... over l1li rem ........... H (3) llralllli II l cllllr.III,.. A 1111 01l1li controllers 1111'011 ... :
CMlrtller Culroller No. e' Type.' G .... i Alu CMlreIltll , ~ '" .~ MII4I11 Number Sllliona Conlnllier
R.IIIII,. A 12 EI.ctrlc Ho111.
Rilin 81,. II 12 Electric Holls 1 &. 2. ( --Rlln BIni C 12 EIICblc Hale 3. -J Rliin BIni D 12 Ellelflc Ho1114& 5.
Rlln Bird E 12 [Ieclrlc Hal'l Ii " 1. ~ Rlln Bird f 17 Electric HOle. 8 & 9.
Rlln II" G 12 Ellelrlc HoI,10.
Rlln IIlrd I 12 Ellelfle Holli 11.12. & 13. l Rlln BIni J 12 Electric Hoi •• 14 '15.
Rlln 81r' j( 12 ElectriC HoIe18.
R.'n 81rd L 12 Eleclr'~ HOle 18.
Ralll 1'111 M 12 Electric HD10I1. &11.
RIIII 11111 0 12 Eleclrlc Grilli.
RIIII 81rd P 12 Eleelrlc GlnM
( J1i Crl ..... II 12 Elleble Aprons
G, ...... 5 12 EllClrlc ....
t
11.1111111 T 12 Eleclrlc T".
~ lIalllllrd U 12 Elleble T ...
fl~CI W 12 Eleclfle Cl ...... " t Fl.' X 12 EI.eble SIr"' ....
~ IIIIIIIII~ Y 23 ElectriC R ... ", , ,
111111 Bird l 12 Eleelrlc RD.,,,,
J R .... 1nI 12 EllcIrIc Cl .......
.... : Canlr811", II. III. Q ... V ., noll.llI •
. l 5 i -\ ~ l! -_-7':"'· ....... ' ..... '-____ '.r ______
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Wiler IllIIppliell by 1'111 A110 Wiler Depart .. enl. The "al" HII'ce laNrI r WI'" m,"rll colneCl" 10
III 8" supply line I' each pOinl II connedian (lwe). SIalic W.llf pr.Allre I. IiII-R pll. TIM .. ,ply U ...
have anly • 'ICUlm b, .. kll he.d and 110 1101 prow'" proper .. cldloW prlllcllell.
Wa'" celllPlllY d ... allow .001111 JlllIIIJII.
Drtnkllll IIunlelnllf' an • "paf'" l1li11111111 1r.1I1111 clullllllllll "If,
l1 2. ANALYSIS
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21. AS-IUILT llRAWINGS
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AII ... ·.II!" drawing I.a,allabl.lhowlnllll, Doll COIIIII"''',U .. ayaIIm. Howftlr IbIa plan
I. noll000,lo 'CCUfll, alld Is 'alla'I, 1I1 •• ramIDlUc.
Clllel •• lon
"II .,nlelllllO knOW oaell, wbal II lilli".,.., ....
RIeIIII ... ndiHon
ClIIIPI ... and ICCII,.I, ... ·.ulll" recoN ~".lntl.IhDUIf 1M bpi.., UIII .... .,11 or " ... 1 ...
II I""" ... nte •.
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211. MODIFICATIONS IN IRRIGATION SYSTEM
C'hCI!'~
Certlln mcdlllCillonl have boen l1li •• In Ih. Irrlg.llon .yall .. IIIICI lilt ,,111111 WII Inlllilly
Inltalled. 11l1lS. modlllcalloni hi" Incl •• ltI.d~11I1I canllollllll,"w 2411111 .,Iat II1II M.IU .... SlIm, 11"lnkler .... d.. "01 •• '10, '11".""l1li , .... we,. JI ..... ,.. .. 1111.
CIIRcl.alol
InI"llon ellah,l, hlVl nil .... n Nil' .. I II1II'" plM .. lilt COIIlPII" 1Ir11iU. &yII1 ••
RICIIIIIIIIINI.u ...
Art, chlllil. II 1III.,IIClllons 1ll1U11i M .... I. I PlI .. 11r 11.611 11l1li ... 111 M l1li11..-,lallllill
IMlftolnftrH.
CI"cern
Spacing 0' 1fII1"1' 1Ie •• 1 I. err.Uc. The" doe. nol a .. m I. H IIIICC11J1I. spaciAl whlell Will
.dhe.ed 10 .... n lilt 1,II,m .1' Insllllld. The "1III1t I. l/wllll,,'n, •• ,lIIllr .. 4111 ... In II ••
CIIII.1a I' "1m I tilleel plllllll.1lMr ClIII. TIIe.1IIIIl Clai'" ....... iii .... 1812 "'1.
Cend.llon
The widely wa,ll' Spicing. r.1U1l In .n ..... prlnkllr 1111\1111111011 pIII'JIII. TIIII. II ••• with f
,,_1111,. dlllerenCll, hllps unlriliul ... II" ..... I .JI... WhI, •• !aU.,. Ir. 51 "I' or '
ClOM', wel.rt •• , ... Iap ...... ". '
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RecomllllllllllllllS '1--,' ',",'1, """" ", , , :;' \", ',: ',t',', \ .. , '" ~ "
SpaC.1n1 should be rad.n, all 1II.lInulII 0' 60 to 1i5'Iel, l"u'II.ly .. llIUIld OIIlIIe loll CGUISI ,,'~,:; \". ' ' '
and d"loned willi Ihl p,oper sprlnkllr I'. nazzl .. Ill... Ihl. I, • lII.jllllMll"""', alld WIIIld
require new plplnl II .. II al 01111, COIIIPDllllllpI"'.
tC"'Wlln" li'iiidU •. r·~
,
Concern
Thll w.lllr pressu" n measured wllh I pllOI tubl 011 'h. ,all cou,., I, •••• lIIlanl on Ihll Iialic
p,essure Inll the number 01 eDnlfalleB I ... ralh" It .... II.... 1lII1,Ictl .. II .. lIIr.ugllOilI lb.
Irrlo.llon system II .pprollmall" 25 pII ........ "" 011 .... ' I ......... II 0lIl u.n..
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EST!MATE:
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IRRIGATION SYSTEM
COST
$700.000 10 seoo.1I8O
10
BOOSTER PUIIP
COST
$70 •• -$11.008
TOTAL
COST
$no.IlD8-$IIO.oao
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~tachment C
CITY OF PALO ALTO
GOLF COURSE CAPITAL PROJECT
FEASIBILITY STUDY
May 1991
BARTLE WELLS ASSOCIATES
Independent Public Fmance Amisors
1636 Bush Street
San Franciscc CA 94109
Tel. 415/775·3113
I
L
,' ...
May 1, 1991
City of Palo Alto
250 Harr .. .f"on Avenue
Palo Alto...A 94303
Attn, Emily Harrison
Dire<tor of Finance
Re: Golf CO".rrse Capital Project
Feasibility Study
".J ' •. _ :, ,.'.
We are pleased to present our repon analyzing the financial feasibility of
two capital ~:ojects to improve the Palo Alrc municipal golf course~
Our repon desenbes the projects and their estimated cos~ calculates poten
tial revenues and expenses, and examines financing options. Conclusions
and recommendations are summarized at the end of the repon. Our pri-
mary conclusions are: .
• Project I-a full reconstruction and redesign of the present course
and addition of a operts oomplex at a cost of $il to $13 ntillion
is not self-supponing. Termination of the EI Camino Park lease
would not assist project feasibility. While sa,,'ings in lease costs
could be used as an additional source for project debt service pay
ments, termination would incur one-time buyout costs of over $9
million that would exceed lease cOS! savings. This conclusion should
be reevaluated if current lease tennination nego"dations result in
significant buyout cost reductions or if the city elects to fund web
capital costs from SOt!I"Ce:S other than the golf COI.l1"Soe revenue sources.
• Project 2---<:ourse renovation at a cost of $S to $6 million-is self
supporting. In addition, revenue and cost s.avings would, support
an increase in project scope up to $8 million.
We have very much enjoyed working for the city on this important project
and are confident our rC!'Qrt will assisr in decisions necessary to proceed
with golf course improvements. We look fonvard to the opportu.....,.iry to as
sist the city with a bond sale to finance improvements. We have appreci
ated the help • .nd cooperation of the 6ty staff, particularly:
• Emily Harrison, Director of Finance
• Kevin Riper, Assistant Direcror of Finance
• Gordon Ford, Manager, Treasury DivL;ion
• Paul Dias, Director, Parks .and Golf Division
Very truly yours,
BARTLE WELLS ASSOCIATES
;(~d~~
Lora J. Stovall
US/KS:mt
Xr-~
Kent South
•
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CONTENTS
Introduction 1
The Proj!!Ct • . . • . . • • • . . . . • • . . . . . . . . • . . • . • . . . 2
Description •......•.....................•........• 2
Project = ...................................... 3
Revenue and Expenses ........................ 4
Golf Course Financing Policy ...•... . . . . . .. . . . . . . . . . . . .. 4
Current Net Revenue ...•.....•..•..................• 4
Estimated Fee Increase Revenue . . • . • . . . • . . . • . . • . . • . . . . .. 6
Cost Savings ...•........•......•..........•....... 10
Course Closure Costs ...•......•.••..•......•..•..... 12
G.f Course Financing Options • . . . • . • . . . . . . . • . . .. 14
Federal/ State Grant or Loan Funding .••. . . . • . . . • . . . . . . . .• 14
Borrowing Methods •.•...•.........•................ 14
Borrowing Costs . • • . . . • • • • • • • • • • • • • . • • • • . . • • • • . • . • .• 16
Feasibility Analysis • Project 1 •.•.•.....•...•..•..••.... 16
Feastbility Analy.is • Project 2 ........•......•.......... 17
El Camino Park Lease Option . . • . . . • . . • . . • . . . • . • . . . • . . .. 20
Qmcl~ and Recommervlatio1lS • . . . • • • • • . . . • • •• 22
UST OF TABLES
1. Project Cost Estimate . . • . . . . . . • . . • . . .. . . . . . . . .•... 3
2. Revenue and Expense History and Projection · .. ~ .. ~ .. ~ .. 5
3. Area Green Fee Comparison . Public Courses . • . • • . • • . • . . . 8
4. Comparison of Fees to Rounds Played· Public Courses . . .••. 9
5. Estimated Fee Increase Revenue ~ ......... , .......... 10
6. Estimated Cour.;e Closure Costs . . . . . . . . . . . . • . . . ..•... 13
7. Estimate of Debt l5sue Size and Debt Service CoOsts ...... ,. 17
8. Capital Project FeasIbility Analysis· Project 1 · ........... IB
9. Cap!:al Project FeasIbility Analysis· Proje<t 2 · ........... 19
10. Estimate of Possible El Camino Park Lease Payment Savings . . 21
.
.,
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INniODUCTlON
Th~ City of Palo Alto is located approxi: .tely 35 wiles south of San F!'a)lcisw
in Santa ek, .. County, and has a populatioo of 57,000. Palo Alto MWlicipal
Golf Course is an 18·hole facility located on Emban:adero Road in the Bay·
lands Nan= Preserve area, just east of U,S, Highway 101. The facility in·
cludes a drhring r.mgeJ practice greer; golf shop, restaurant, and maintenance
facility. The site covers approximately 180 acres. The annual number of golf
rounds has averaged 105,000 over the past eight years, making it one of the
most neaV':iy utilized golf facilities in the Bay Area.
In 1978 the city sold lease revenue bonds to fund improvements including two
fairways and five greens, relocation of the driving range, construction of a new
clubhouse, and orher improvement:;. Th.,.., improvements were b ... <ed on exist
ing use patterns. Facility use panerns began to change in 1981 due to new
course managemmt and concession vendors.
In 1986 a clubhouse upgrade study was completed and in 1988 an irrigation
system renovation sl'~dy was completed. The staff has also completed a study
of using recJaimed water to irrigate the cou:.e. The city already provides
wBter to the City of Mountain View for use on its Shoreline golf ccnme.
Since the last major course improvements funded from the 1978 bond issue,
the city staff has prepared capital project requests in response to identified
additional cour.;e improvements. For example, in preparing the 1990-1995 capi
tal improvement prugt"m. improvements totaling approximately $2 million were
considered but not recommended pending funher srudy,
City staff has now prepared alternative impro"""'''''t plans for the golf cot=!!
renovation and • possible sports facility. BanIe Wells Associates was selected
to:
II Review the city's current golf coune finances, policies, and objectives
• Review changes in golf and v!!Ildor operation,
• Review and analyze the economic feasibility of the capital improvement
alternatives
• Survey comparable green fees in the market ""-4
• Determine future financin, capacity to fund capital improvement projects
from golf course revenues
1
-
Tl1E PROJECT
Description
The city provides a wide range of community spruces L.Ttc1udi.Tlg a goif COll.'""Se
to serve a growing golf market. The site of the golf course complex is located
in • fonner marsHa.'1d area, however, and has been plagued by poor turf and
JaruL<cape quality, The site is below sea level, Aceumu1atioIl5 of salt and other
subS"'"..ances natural to t.~e area have resulted in course deteriorntion as well as
an increase in maintenance and repair costs. At the .same time, new or reno
vared COUIS<!S located nearby are competing rDr the same recreational revenue,
These conditions reduce the 1e\"eI1ue potential of the course as wen as the pro
shop and restaurant ",roors, Gclf course ope1atians are gen=Ily self·supporting.
The public is willing to pay for facilities with good playing conditiOIl5 and smeni·
ties such as adequate pBrlcing, driving range, restaurant, and other facilities.
Potential fee increases and vendor rent increases are dependent upon facility
improvements,
Two projects have been proposed to address these concerns:
Project 1 -Pull Rec=stnxtioo of Comse and Spor:1s Complex: The concept of
this project would entlill development and implementation of a master plan fot
conversion of approximately 25 acres into a lighted multi;>l. sports complex.
'!bis complex will include fields for softball activities plus off·season use for
soccer, volleyball, or other recreation activities. The potential of lighted fields
would extend operations of both the golf shop and the restaurant operations.
The remaining acreage would be reeonfigured into a new champi,m.5hip golf
course and driviDg nmge to =nplete the package. This would ent.n complete
renovation of the current golf course and reconstruction of the site utilizing a
12 inch sand cap to provide permeable soil, raise the site above ..,. level, and
improve golf playing areas. A conceptual study completed in 1986 addressed
parking, restaurant and pro shop expansion, iIIigation and reclaimed water and
associated landscaping. This plan would I>e "",ised to include additional golf
cart storage, increasing the size of the equipment mainterumce repair facility
and potenCal iru:reases in office space. ...Jl redesign work would take into ,on·
<ideration future wor\ pro]>OS"d tor raising the Je\'ee at Franc:isqulto Creek.
The scope of this project would entoil clO51m! of !hi! golf c0t:r5e a!ld golf shop
operations for • 2 year eonstruc:tion period. Res-.aurant operations could con·
tinue for non-go1f customers, For economic feasIbility purposes, capital costs
of the sports eompieJ: portion of this project are separately identified and ex
cluded from costs to be funded from golf course revenue:;.
Project 2 -ColIne Ilmavation 0IlIy: This project would entall the develop
ment and implementation of • master plan for complete renovation of the golf
course and driving range complex, but would retain the existing hole configu
ration. All playing areas would be ."built utilizing 5a.'1d base consrructioa to
raise fairway are.JS 10 sa ;~ or abo'!e would provide adequate drainage and
permeability (0< reclaimed water use. Fairways HID and H18, and Greens #3,
#10, #17 and #18 were rebuilt in 1976 ro current sand technology standards
and would be utilized in their present configuration. The sand based fairways,
2
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for materiall'urpo,es, would be retru""d. The 1986 conceptl'al .rudy would
be revised to include additional restaurant and golf shop space, additional golf
ca...'"1: parking:, c-omp~etion of golf <:art path system, equipment rnzintenance facil
ity apansion, replacement irrigation ond , <:laimed w&ter connection. Although
this plan utilizes the existing configuration of the golf coroplex, consideration
would be given to potential relocation of the driving range and also realign·
ment of Holes #12, #13, #14, and #15 as the future ralsing of Fnmcisquito
Creek impacts these areas,
This proposal could be accomplished in phases (e.g., front 9/back 9) thus al·
lowing partial operation during construction. Both the pro shop md the res·
taurant would remai" open.
Project Costs
Table 1 shows estimated costs for both projects as fallows:
• Project 1 ............................. . $11,000,000
5,000,000 • Project 2 ...•......•. • .•.•.•....•.....
These costs include the golf course portion of the capital costs ne<:essaIY to de·
li_ reclaimed water from the city's treatment plant to tht golf course. All costs
attributable to use of the sports campi"" in Project 1 (estimated at $1,515,000)
would be an expense of the parks department rather than the golf course, end
wauld be paid from genenU funds of the city.
Project cost data has been estimated by city staff from discussions with qualified
golf oaw-se archltects regarding current conmuction costs. Upon determination of
project feasibility, • logical next step would be development of a master plan.
TABLE 1 • CITY Of PALO ALTO GOLf COURSE
PROJECT COST ESTIMATE
Course renoyation. irrigation
Sand cap
Design
Clubhouse ~deling, p~rkin; lot
Cart ~ath, repair facility addition
Recla'~d water pipeline cost
Conti ngency
(stiMted tota1
Less s~rts Co.p1eK portior. (~5 acres):
Mar~lna' construction C05t5
Ughts
Bleachers. backstops
Cont 1 ngency
Total sports complex costs
Net gelf course cost estiaate
$ 1,100,000
150,000
120,000
~45.0CO
1,15,000
$ 1,485,000
1 -P.ec:oofi gunt enti re COUTSi!. add SPOl'1:s conp1 ~x (:-equi res fun COUMe c:1 osure}.
2 . R~t.i" existing configuration, rt~oyate course (requires only partial
c1osure) •
3 -Incl~d.s sports complex.
SQurce: Cit, ~p and ca~itilil 1~pro~eMent progran propo$a1 memora~da.
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REVENUE AND EXPENSES
Golf CoWlle Financing Policy
v'lhile golf course operstions have been accounted for as part of the cirys gen
eral fund, the c;,ys finar.cing policy has been that operation a!ld capital ex
penses should be paid from revenue generated by the cours<!. Although the
city allocates cerrain overhead costs to the operation, the$e are not used in cal
culating net income for the golf course, due to prior council direction Llu:r the
golf course should recover only direct operating expenses and c"pita! costs.
The approach taken by the parks and golf division staff is to view the golf
course operation as a busi..ness enterprise. They snive to upgrade the course,
increase play, and b'L!.ild a reputation that will attract and retain golfers. At
the same time, the objective of these efforts is to make the coutSe profitable.
In J 978 the C.ity of Palo Alto Golf Cour>e Corporation was organized to fund
improvements to the course and issued $1.8 million of lease revenue bonds.
Debt service payments on corporation lease revenue bonds are paid from the
general fund, but under city policy net rot=e revenues must be sufficient to
support debt service payments. In addition, the city has indicated its continu
ing interest in ensuring that golf cour;.e operations are self-supporting.
The city's CWTeJlt golf course finances, policies, and objectives were reviewed,
as were similar policies in nearby comparable municipal golf courses. Golf
associations and golf participants co= that existing courses are experiencing
growing demand which exceeds available supply. While participation in the
spott is apparently increasing, golf couzses serve only a limited portion of city
residents. Perhaps more significantly, the golfing population tends to be char
actedzed by those able, willing, and accustomed to paying fees which facilitate
a self-supporting operation. Continuation of the current seIf~pporting policy
is the basis for the feasIbility analysis which foDows.
Current Net Revenue
Golf cOW"Se operations are a<counted for as part of the general fund of the city
but revenue and exper.se dara are available from the budget and other finance
department records. Table 2 shows operating resulrs for the three-year period
from 1987/88 through 1989/90, as weD as budget projections for 1990/91-
Golf course revenues (i.e., greEn fees, pro shop, and coffee sholJ rent) :h.ave
been sufficient to fund all expenses including debt service on the 1978 lease
revenue bonds.
Water costs have increased significantly, from $94,671 in J 987/88 to a bud
geted amount of $242,568 in 1990/91. Water costs are increasing as a result
of drought conditions and increases in wholesa1e water rates over which the
golf course has no control. Water costs now constitute 22 pen:ent of operat
ing costs. Further cost increases are projected due to continued drought
conditions.
For the three-year period ending 1989/90, actual net reyenues ayeraged
$206,000 per year and were approximately $160,000 in the latest year. This
feasibility analysis assumes that up to $150,000 of net revenue per year from
4
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TABLE 2 • CITY OF PALO ALTO GOLF COURSE
REvtllUI: AND EXPENSE HISTORY AND PROJECTION
Actual Adopted
Budget
1987/88 1988/89 1989/90 1990/91
Revenue
6reen fee, • 923,916 $1,039,266 $1,088,250 $1.246 ,050
Pro shop rent 75,000 82,000 86,000 90,300
Coffee ,hop rent 30,300 33,000 35,000 37,000
Other J,Q2Q . 1.Q2Q I,QQQ
Total revenue $1, 03(), 216 $1,154,265 $1,210,250 $1.374.350
~;ng Expenses
Employee services $ 396,515 $ 344.980 S 428.598 $ 449,406
Contract services 48.45.2 48,548 48,577 126.bOO
Supplie, I material, 92,553 80,546 96,133 136,900'
General expen,es 1,479 24,410 28,681 40,204
F.cilities • equipment 46.~31 28,743 29,986 45,500
Allocated charge"
Water 94,671 132,70l 186,B88 242,568
Other rei .... rsed to ci ty 6,575 35,826 41,182 38,533
Other allocated 2J,5Z§ ;!!l,m l~,~ i1Z,i1Z~
Total operation, $ 110,104 S 726,273 $ 896.643 $1,101,935
Water co,t ., percent of
toto I operat i n9 costs 13.3% 18.3% 20.8% 22.0%
Net revenue before
debt service $ 320,lI2 $ 427,993 S 313,6::7 $ 272,415
Debt servi ce m,m 12' 2!l7 l~,QQQ l~,lQO
Het revenue S 186,575 $ 272.006 S 161,607 $ 124,315
_r of roonds 107,585 105,371 103,265 100,000
Revenue per round $9.58 $10.95 SIl.72 $13.74
Co,t per round' 7.84 8.37 10.l5 12.50
Cost per .c .... $4,585 $4,795 $5.699 $6,793
1 ~ [ncrease partially due to drQught recovery ..
2 • lncl"de, debt service.
Source: City of Palo Alto finance department records.
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C.llTe:nt opErations could be. sustained and utilize.d to supp.ort project debt ser
vlce. AdditiOila.l operation and m.:ltnrenance (O&M) fxpenses would require
higher green fees.
Estimated Fee Increase Revenue
The Palo Alto golf c~=e market area is graphically displayed on the !lext
page. The legend identifies public (fee) coW'Ses in the mark€[ area.
A survey of green fees of public courses in Palo Alto's market area was com
pl.ted in Februa.)' 1991. Tabl. 3 shows the result' of that survey, Courses
are grouped as either municipal cow-ses or privately owned courses alJowi.'1g
public play. A campa-lisen with a .unnar survey conducted by the city in Jan
uary 1990 shows that most courses increased fees by over 10 percent over that
period of time, with many of those increases effective in January 1991. The
city has historically increased green fees in Nlg'JSt of applicable years. Table 3
also shOW'S Ii comparison of CUITel~ -i~y fees Yliih the median range of the marker
area. It demonstrates that the = fees are approxirn.tely 4{) percent below
the. mediara..
rable 4 compares rounds played to fees charged in 1~. Rates shown are those
in effect during 1990 to maintain co.,nperabil.ity with rounds played in the same
period, and are not L;"'e same as those sho'WD. on the most recent survey due to
subsequent fee increases (Table 3). Cou!ses are listed in descending order of
rounds played. Since demand is influenced not only by rates but also by C01lISe
condition, the table shows recent known course lmpIO";ernenlS. While no clear-cl1t
correlation is shown,. it appE'3I'S that mWlicipal courses whid are either new or
recently improved could successfully charge up to $25 and still achieve a num
ber of rounds close to capacity. By contrast, Shoreline (City of Mountain View's
municipal course) has a policy of high fees for nonresidents. While rounds
played are significantly below cour.;e capacity, the O!-j indicates that total green
fee income is approximately $1.6 million per year compared to $1.25 million
in Palo Alto. The City of Mountain View estimates that only about 27 percent
of play is by residents, even with a SO percent resident discount.
Market d~d is affected not onJy by fees and course con.d.itiOJ"1.., but also by
the number of golfers and available courses. National G<llf Foundation research
indicates that the number of golfe. .. in the United States grew from 14 ro.ill.ian
in 1978 to 23.4 million in 1988, and is projected to grow to 30 million by 2000.
In Palo Alto'. market area, whfle population had increased, public golf course
supply has not kept pace. A 1987 marker survey of public courses in the San
Jose market area indicated a course demand of 25 in 1990 but a supply of only
18 cou....-se5. Development pressures have resulted in closing of some public
<ounes in this market area (e.g" Oakridge and Hillview in San Jose and Fair
way Glen in Santa Oara). New public course development has not met the de
mand. This demand is ve"-fied by the number of courses shOW!1 in Table 4 with
roU!1ds played at or near capacity (approximately 90,000 to 100,000 per year).
6
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South Bay Area
~,,"1110
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LOCAOOH OF PUBLIC COURSES IN niE MARKET AREA
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~ TABLE 3 ,. CITY Of PALO ALTO GOLF COURSE
, , AREA GREm FE[ COMPARISON· PUBLIC CIl'JRSES , ,
r I Re9ular hi light
i Carts i CClJrse lo<:ation I/eekday Weekend Weekday Weekend Senior' 9&16
, I
I !bt;c;pal I
I San Jos. San Jose $18.00 $25.00 $12.00 $15.00 $12.00 $11/20
San Mateo,
Resident San Mateo 8.50 10.00 7.50 7.50 7.50 14·]5
Nonresident San ""teo 9.50 11.50 7.50 7.50 7.50 14·16
Santa Clara,
Resident ~nta C1a!"i 11.00 16.00 6.00 10.00 n/a B/16
Nonre'Sident Santa Clna 14.00 20.00 B.OO 12.00 n/a 8/16
Santa Teresa Sar. Jose 20.00 2B.00 16.00 13.00 13.00 20.00
Shoreline" Jt40untain View 29.00 38.00 !1.00 17.00 21.00 10120
Spring Val ley Mi lpita~ 17.00 25.00 12.00 14.00 14.00 12/20
Sunnyval.,
Resident Sunnyvale 13.00 17.00 8.50 11.00 11.00 14/20
Honresident Sunnyvale 14.00 19.00 10.00 13.00 11.00 14/20
Public Play
Crysta 1 Sprs IkI r 1 i ngame 35.00 40.00 28.00 34.00 n/a 11.00
Rive,..ide San J"". 17.00 22.00 13.00 17.00 13.00 14/20
S_it Point Milpitas 20.00 31.00 15.00 20.00 15.00 10.00
Sunol Sunol 18.00 28.00 12.00 15.00 50/1DO 24.00'
Hedian<C 18.00 25.00 12.00 IS.CO
Palo Alto Palo Alto 13.00 1].00 6.50 11.00 10.00 9/17
varl ance fron
.dian:
AIIIount $ 5.00 $ 8.00 S 3.50 $ 4.00
Percer.t 38% 47% 41% 30%
1 . Restricted play.
2 -Residents pay 50\ of all fees s~own.
3 -Mandatory.
4 -Full (nonresident) fee.
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TABLE 4 • CITY OF PALO ALTO GOLF COURSf
COltPARISON OF fEES TO ROUNDS PLAYED -PUBLIC COURSES'
latest
Course Rounds
_cia
"",kend
Co"rse Location Improvement Played Rate~ Rate>
S.n~a Ciara Golf Club Santa Clara New 1985 110,000 $14.00 $20.00
San Jose Municipal San Jose-1989 107,017 16.00 22.00
Palo Alto Municipal Palo Alto 197B 101,01B 13.00 17.00
San Hat ... San Hateo nla loa,~o 9.00 11.00
SaT'lta 'Teresa San Jo-se 1911S 98,000 17.no 25.00
Sunnyvale Hun;cipal Sunnyvale 1989' 88.500· 13.00 17.00
Crystal Spri ng. Burl ingame 1987 85,000 33.00 38.00
Sprlng Yalley Milpitas 1989' ~2,000 15.00 20.00
Ri'Yerside San Jose n1. BO,OOO 15.00 20.00
Shoreline Mountain View 1988 65,000 29.00 38.00
Summit Point C1ub HilpHas 1990" 63,859 18.00 25.00
1 -1990 dah.
2 -full (nonresident) rate.
3 -Ongoing.
4 .. Some holes under construction in 1990~
Source~ California State AutOllObile Association. Guide to Northern Cal-
fforn;a 601f Courses; City of Palo Alto survey of green
Janu.ry 1990.
fees.
In light of marl<et demand conditions, a fee iru:rease up to the median should
not reduce rounds played if facility renovation results in an attractive and com
petitive cOW'S. compared to similar courses in the market area. The dty
cCourse already has a high degree of difficulty, due in some measure to the
length and configuration of the course. The total land area is approximately
180 acres. Many compcn:·ble market area public courses are built on sites of
only 125 to ISO acres.
Survey statistics and rounds played at Palo Alto and comparable courses indi
cate that area market demand is high. Either proposed improvement project
will result in a coune that should command at least a mark~t median fee.
Project i would, in addition, provide a more atttactive course in that the entire
course acreage would be improved, nO! just the playing areas (Le" fairways and
greens). However, the cour.;< resulting from Project 1 would probably not com
mand significantly higher fees tha,.., !he renovated coune resulting from Project 2,
This feasibility analysis assumes that the city can raise fees to the median rate
upon completion of either project. Table 5 shows the detail of the proposed
fee increase by categolj' for an increase in green fee revenue of $508,000, or
41 percent above the revenue that would be generated by 1990/91 f..,s. The
feasJ.,ility analysis projects increased revenue of SS58,OOO a,1 course opening in
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TABLE 5 • CITY or PALO ALTO GOLf COURSE
ESTIMATED fEE INCREASE REVENUE
1990/91
C"rr'ont Estimated
Rate Category Rounds Pat' Revenue
Weekdays
9 holes 3,000 $ 8.00 $ 24,000
18 he1 •• 38,000 13.00 494,000
Junior/senior g,OOO 10.00 90,000
T.il ight 15,500 8.50 132,000
l/eek..,ds
9 ho1.s 3,000 9.00 27,000
18 ho1 •• 23,500 17.00 400,000
T';l ig-ht 5,000 11.0e 55,000
Playcards
Senior (275) 3,600 60,00 17,000
Junior (175) ~ 40.00 Z,QOO
Tetal 102,000 $1,246,000
Increased revenue at course open; ngl
I -T~ median rate sho.n in Table 3.
futLire Course
Increased Esti1lllted Increased
Rate' Revenue Revenue
$11.00 $ 33,000 $ 9,000
18.;)0 584,000 190,000
14.00 125,000 36,000
11.50 118.t)On 46,000
13.00 39,000 12,000
2~.OO 587,000 187,000
15.00 75,000 20,000
ao.oo 22,000 5,000
55.00 10,QOQ J.QQQ
$1,754,000 $508,000
$558,000
2 -Assumes a 10% inflationary increase after two-y~ar construction
program.
1993/94, assuming a 10 percent infIatioruuy adju..<tment for comparable <0=
during. two-year construction period. In addition, the city should be able to
increase revenue from pro shop and coffee shop rentals rhrougl: contrtict nego
tiations that recogni:e greater income potentia!.
Cost Savings
Reclaimed Water Use: Table 2 previously showed that water costs for the golf
course have increz.sed significantly. In 1990/91 such costs aIe estimated at
$243,000, Dr about 22 percent of total operating casts. POfable water rate
increases sdopted by the San francisco Water Department for sale to wholesale
clients like Palo Alto in 1990/91, and further-increases under cor.sideration,
could significdrltly increase the price of potable water. Pemaps more impor
tantly, if the current drought continues. irrigation wa.ter from existing sources
may be unavailable or highly restricted.
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The city needs to fLld areas tQ dispose of its surplas effluent water from its
wastewater treatment pl<ll1[. The effluent meets state -srandards f'?r all re·
daimec! water irrigation oses. The city currently delivers reclaimed water to
the City of Mountain View for irs Shoreline golf course and w'..!l soon begin ~o
use reclaimed water on Greer ?ark. Approximately 15 years ago, during the
previeus drought, reclaimed water wa.:; used. at the Palo Alto golf course for 8
shOlt period. Delivery was Stopped due to inadequate >"\lpply lines and salinity
problems with the rurf.
RL'Cent consultant lests of soil and water at the COIme indicated That a blend
ing process would make the reclaimed water satisfactory for use at the golf
course. Fwther, the Parks ar.d Golf Division Director has indicated that the
proposed COIme renovations, which include a 12-i<lcll sand cap, will reduce the
risks involved to turfgrass quality through use of reclaimed warer. Careful
morrltoring of actual use will be required to avoid turf maintenance problems.
• Capital =rs: A water quality control plant ana1y.is in 1990 indicaled
t!lllt a reclaimed water pipeline project would cost appru<imately S300,OOO.
The timeframe for such a project is estimated at 12 months from design to
completion, which is less than the timeframe 10 complete either golf cou=
project. The facilities necessary 10 enable the golf course to use reclaimed
water consist of a pipeline from the adjacent wastewater tteat:l':!ent plant
to the golf =e, and • blending well or tank and booster pump on the
golf em=. 1M city l= included this project m its proposed 1991/n cap
ital inyprovernent program. Sa\oings will begin immediately upon completion.
• 0penIting Costs: Reclaimed water use sav'.Il8' are diffieult to estimale.
Savings are largely dependent on the following policy decisior.s:
• Blend of potable and reclaimed water (l00% reclaimed vs. blend)
• Price of reclaimed waler to golf COIme (if any)
Assuming current policy direction (i.e., 100 pereerll reclaimed water use,
zero cost 10 course), annual savings in water cost> of up 10 S250,OOO from
the 1990/91 budget could be achieved through use ofreclaimed water.
Potential savillgs in future years could be even greater due to projected
drought-related potable water rate increases. ThE total cost savings would
be reduced due to some increase in the cost of electticity fur pumping (esti
mated at $16,000 per year by the utilities department).
Elq>eDdilure Control: Table 2 refiec" ,.ctual data through 1989/90 and
adopted budget data for 1990/91. Budget"" expenses for employee services
plus supplies and materials are signifu:antly higher than actual expenses due to
e.xpenditw"e control measures adopted by the golf course to preserve profitable
operations. Similar cost reductions are now anticipated for 1990/91. Expen.
runlre reductions are estimated at $70,000 compared to budgeted expenses.
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sw~~ from All So\.1tt.es: Maximum a.:.-mu::U s.avi..l.gs from all sm.:.rces a.bove
are:
Reclaimed water ......................•...•. $250,000
E..-pendiru. ... control ............•............. 70,000
Pumpir.g costs • • • • . . . . . • . . . . . . . . . . . . . . . • . . .• (16 POOl
Total •.....•..•.................•........ $304,000
This feasibility analysis assumes $300 j OOO net 3IUlUaJ cost savings as a reason
able estimale pending reclaimed waler blending/pricing decisions.
Course Closure Costs
In addition to project oosts. economic feasibility of the projects is impacted by
disruption c.f operations for a period of up to two years under eiL"er propesal
The figures below summarize the estimated net cost to the city due to such
closure basod on budgeted 1990/91 expenses:
• Project! ..••.....•......•........•...... $962,000
• Project 2 .•....•.•....•.........•.•...... 704,000
Detru1ed closure costs are shown in Table 6 and clistussed below.
Employee Servias: Under either project assumption, the city should attempt
to keep employee expenses to a minimum during the construction period and
reduce staffing by attrition.
Assuming either project proceeds "ithin one year, projectod attrition rates and
existing vacancies suggest a maximum reduction of three positions (out of
eight) for full course closure. Partial operation will require more petSOIUlel;
a reduction of two positions is assumed.
Oth.er Operating Ezpenses; AU other operating costs except allocated costs
would be eliminated during the two-year fuIl-closure propcsaJ and it is esti
mated would be reduced 50 percent during partial closure. Continuing allo
cated costs of $30,000 per year are assumed as. well as 50 percent of current
water costs for partial closure.
Business In!erruption; The city has existing conrractl' for both the pro shop
and restaurant/coffee shop. The pro shop lease is long·term (with six years
remaining), while the restaurant lease has been on a month-to-month basis
pending a master plan and a decision to proceed. FlLrther, the pro shop would
Sllffer a greater degree of business interruption under either project propesal,
while the resta"llt"ant would still attr2.ct some non-golfer-a. .. sociated business.
Both operators are aware of potpr,tial facility improvement pians and have
indicated their willingness to support the plan fir...ancially to create a better
operation in the future. Table 6 assumes a cost to the golf co= of S25.000
to $50,000 paid to the golf professional for services during project construc
tion. Actual business interruption costs will depend on negotiations with the
operators.
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T~BLE 6 • CITY OF PALO ALTO GOLF C~JRSE
ESTIMATED COURSE CLOSURE COSTS
Expenses
~loyee services
Contract servIces
S"pplie •• 5Oteri.l.
Gene-ral e)llp!nse
facilities I equipment
Allocated costs (including water)
Total 0&.'1 costs
Oebt service
Business interruption:
Pro snop
Coffee shop
Total expenses
Revenue
Green fees
Pro shop & restaurant rent
Total
Estiaated net loss due to closure
T~tal for 2-year constru~t;on period
full
Budgeted Closure:
1990/91 (Project I)
$ 449,000
127,000
137,000
40,000
46,000
3Q3,OOO
1,102,000
148,000
1,250,000
1,246,000
m,QOQ
1,374,000
$275,COO'
30,000
305,000
144,000
50,000
499,000
le,OOQ
IS,OCe
4BI,OOO
$.62,000
Partial
Operation
(Project 2)
$325,000"
64,000'
69,000'
20,000'
23,000'
152,000'
653,000
144,000
25,000
822,000
420,000'
~O,OQQ
470,000
352,000
!
$704,000
I -Reduced by three ~sitions through attrition by start of construction.
2 -Reduced by two positions through attrition.
3 -50\ of full cost.
4 -50% of full water cost plus .llocated costs of $30,000.
5 -30,000 rounds at average revenue of $14.
Lost kYemJe: Estimated !evenue losses shown in Table 6 are based on cur
rent green fees and 1990/91 budget data. For partial cl~ the parks and
golf division director estimates 30,000 equh'll!ent full·time rounds per year.
The estimated revenue loss is based on th~ current average revenue per round.
Continuing revenue inch.1des an estimate of restaura.nt and pro shop rent.
Even during full course closure, some rental income is expected, on the BS
sumption that the restaurant will remain open for non-golfer busmeoss such as
lunches for nearby commercial Iocark ; and for dinner.
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GOLF COURSE FINANCING OPTIONS
Federal/ State Grant or Loan Funding
The Federa! Bureau of Outdoor Recreation has been tneJ-.ing matching grants to
states and through th~IT! to rnu..'1icipalities for the pian..'1ing. acquisition, and.
deY~lopment of public recreation areas which i.nclude golf cou.rses. [n Cali·
fornia. this program is administered by the state parks and recreation depa..."'t·
ment. Discussions willi the departmen1 indicate that grant funding for the golf
course project is not probable due to limited funding and project priority cate·
gories. For example, in the fisoal )ear ending Septe.rnber 30, 1991, grant fund·
ing for the state i, as follows:
• Statewvide . ~ ............................ .
• Sta .. projects ..............•.............
B Northern caIifornia municipalities •.............
$3,000,000
1,200,000
642,000
There are 38 funding categories, and golf courses are low on the priority list
due largely to the limited pu"~, served and their fee generating capobility.
Further, the avenoge grant project is only $50,000. Such grants also include
stringer.t conditions !:hat land remain in recreational use in perpetuity. For
example, exp~~on of a restaurant into a previously designated recreation area
would require substitution of an equivalent amount of land for recreational
purposes.
A5 part of its reclaimed water project, the city has asked its engineerL."1g con~
sultant to pursue state loan funding. At this point, the ranking of the city's
project on the state loan priority list or the waiting period for such loan, if
any, is not known.
The feasibility analysis assumes that no federal or state grants OT loans are
available to assist in financing these IlOIf course projects.
Borrowing Methods
Either golf course improvement project w'Jl result in operating losses dcring
partial or full course cloS".Jre. In add!tion the city will need to bor-ow to cover
the cost of cOns!J'Uction,. and will incur signific<L."'lt new debt :.:;ervice costs.
While the city has a variety of techniques available for borrowing for capital
projects, the appropriate method in a given situation depends on the type of
project being financed, the statutory powers of the city, the beneficiaries of the
project, and the credit pledged for repayment. Some of the basic borrowing
methods available include:
General Obligation Bonds: Traditionally, general obligation (GO) bonds have
been a major SOUTC~ of capital funds for public agencies. GO bonds are se
cured by the issuer's power and obligation to levy property taxes, without limi·
tation as to rate or amoWlt, for the payment of bond service. Be-<:ause of this
unlimited taxing power as security, GO bonds have traditionally been the least
costly form of public borrowing.
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The city could issue GO bonds fa: this project, with appruval by two· thirds of
the voters at an election. They are general1;; required to be sold at par by
competitive bid.
While GO bonds are straightfOlWard !O issue and administer, and bear the low·
est rate of interest, a two-thirds voter approval requires a publicly popular
project with gl1I5.n>OL5 support, or an optional project which the city will pur·
sue onJy with voter approval. Winle the golf COllI'e project might re<:eive the
n",essary voter approval for general obligation bonds, the feasibility study
assumes that an alternate borrowing method w'JI be used.
Revenue Bonds: A revenue bond is ."cured by the power to generate non-tax
revenues. Palo Alt? can issue revenu~ bonds under its city c:harter by adoptio.c
of • procedural orrlirumce. This approach has been used for revenl!e bonds
.ecured by utility rEvenues. Revenue bonds sht>uld be distinguished from lease
revenue lKlDds, such as those issued by the city in 1973 for golf ('ourse im~
provements. Leasf! revenue bonds arf! a form of lease linancing. discussed
below.
The soW'Ce of payment for de ht service on revenue bonds is revenues from the
enterprise being financed. These revenues must be predkrable and depend·
able. The city must be able to d=te not only that the revenues are cur
rently sufficient to meet all of the obligations of the enterprise, but also that
the dty can generate additional revenue as needed. In other words, if the city
increases the applicable rates, iL5 revenues will increase correspondingiy. This
is true of such municipal utilitie5 as water and sewer, and gas and electric in
Palo Alto'S case. lr is not true of revenues from reereational facilities. If Palo
Alto incre&eS its green fees, golfer.; may go elsewhere or may ",duce their
play so that additional revenue is not in "de! produced.
The not result is that, while golf course revenues may appropriately be applied
to the payment of golf course e.~es, including debt service. these revenues
do not have the w;enue characteristics needed for revenue bend financing.
Traditional revenue bonds would be limited to instances in which the p.ooje<:ted
rev"""ue:; so gtea"'j exceed debt service paymenL5 that the risks posed by un
enforceable Te""eIlues are very small.
Lease 'mandol!' The traditional method in California for financing projects
which produce revenue but do not have the revenue characteristics necessary
to 5U)'port revenue bond.< is lease financing in one of iL5 forms. Lease financ·
ing includes nonprofit corporation bonds, such as the golf course corporation
financing in 1978, and certificates of participation.
In a lease financing for a project such as this, it is expected that payment
would be made from golf course revenues! but in the event golf course reve
nues are not sufficient to cover all of the expenses of operations and debt ser
vice, the city would agree to make payments from other ciry revenues. This
approach provides the necessary security for the financing.
15
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In a lease financing, the city enters infO a lease for specifi~d facilities and
agrees tv make a s~am of lease payments. necessary to finance the facilides.
With a nonprofit corpot"ation financing, the nonprofit cOl'P,:mltion sells bonds
secured by the city'. l.ase payments. In a certi5cate financing, the city,
through a trustee bank, selis ;ha:"es (i.e., participations) in its obligation. The
city makes debt setVice payments to the trustee bank, which in turn paY' inter
est and principal [0 the owners of the bonds or certificates.
Lease financing, particu1arly using certificates, is a very popular financing
method in California for a number of reawns. They are easy to issue and ad
minister. They can be payable frcm a variety of revenue sources and oan be
strucrured to conform to r...'1f' ciry's revenue sources. They can be paid from
facility revenues, property taxes, interest, conuact payments---wbatever reve·
nue sources are available. California has a strong legal basis for iease financ
ing of various types, including COP's.
Summary: The golf tourse se..>VeS only a limited portion of city residents and
may not secure a two-thirds vote necessary for a general obligation bond.
Also, golf course revenues are not enfort:ea ble as is genE:I"3.lly required for a
revenue bond. The most appropriate borrowing method is some form of lease
finandng secured Dr lbe general fund, but expected to be paid from golf C01J!SI!
revenues. The precise form of borrt1Y.1ng may be certificates of participation
(COP's) or lease revenue bonds issued by the existing golf course no"profit
cOIJlOration. The strucru.. ... and security pledge would be compa. ... ble to that of
the 1978 Golf Course Corporation lease revenue bonds. .
Borrowing Costs
Table 7 shows the estimated debt issue size ond armual debt setVice payments
far both projects, based on current market interest rates. [t assumes a net
inierest cost of 7.5 percent. Interes! payments during Q rwc-year construction
period would be paid from issue proceeds. Annual debt setVice totals for years
3 through 20 are estimated at $1,331,000 for Project 1 and $605,000 for Proj·
ect 2. The reserle fund balance would be applied '0 the final debt service
payments.
Actual cost; will depend on interest rates and terms and conditions of the debt
instrument when the city is ready to proceed with the project.
Feasibility Analysis -Project 1
Table 8 shows an analY'is of Projeot 1 feasibility for a nine-year per.od. The
anaJy.is includes the following revenue sources and costs discussed above:
• Net revenue, current operations
• Operating expense savings
• Revenues from :ncrease in green fees
• General fund contn'bution for sports complex portion of costs
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TABLE 7 • CITY OF P~lO ALTO GOLF COURSE
ESTIMATE OF DEBT ISSUE SllE AND OEB~ SERVICE COSTS
Construction fund
Reserve fund (10%)
Issuance costs/discol.olnt allowance (3.7.5%)
Net construction interest cost
Interest earrings (7.0%)
Est~mated debt issue size
Annua1 debt service (20 y~ars~ 7.5%):
Const,"ction period (first 2 y.ars)'
Years 3-20"
Project 1 Project 2
$5,000,000
635,000
238, 000
895,000
(418.000)
6,350,000
~ :<05.000
1 -Paid from issue prQceeds.
2 -After reser,e fund interest earnings (7.5%). final ye .. 's debt
service paid from reserve fund.
'This anal)"is further assumes that me<lian green fees will continue to inere,
in response to inflatiorurry and market pressures. Table 8 reflects a fee in
crease of 5 percent every year.
Project 1 costs cannot be fully funded from identified sources. The project
would incur a net cost of approximately $139,000 in the first year of opera
tion as well as a loss during the two·yeu full-closure period of $962,000. The
cumulative loss in the year 1999/00 is estimated at $1,300,000.
Feasibility Analysis -Project 2
Table 9 demonstrates the feasibility of Project 2. Net annual revenue of over
$400,000 would pay debt service for an additional $3 million of project costs.
" summary. revenue and cost savings ldentified in this anal)"is could sUP:'O"
up to $8 million in project costs. This !let revenue margin allows for consider
able variation of actual results from as.<UITlptions.
Since Project 2 does not include a sports complex, the analysis does 1'ot in
clude a general fund transf.,. for the $183,000 of debt s.mce costs associated
with the sports complex capital costs ($1,515,000). All other assumptions
listed in the Project 1 analysis apply as well to Project 2, namely, revenue
sources and costs as follows:
• Net revenue, current operations
• Operating expense savin$'
• Revenues from increase .In green fees
• Annual inflationary green fees increases at 5 percent
The project would result in net "perational revenues in the first full year of
operation of approximately $404,000. Cwnulative net revenues (after closure
period losses of $704,000) would begin 10 accrue in the second year of operation.
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lABlE 8 • CITY Of PALO ALTO GOlf COURSE
CAPITAL PROJECT FEASIBILITY ANALY51~
PROJECT 1 -fUll COURSE RfCONSTRUC7!ON, $11.0 HILLION
1991/92(1) 19'12/9J(lI 19'13/')4 1 'I'l4/'I!! 19%/96 19%/91 l'1l1/98 -----~--------~~-------------~----~~-
Swro!o of ~/caJt savitJgs
19'1B/9'l 19'1'I100
Not .......... , cur_ .... rati<:ll i2)
~rati~ I("~ sarirqs (J)
GrMI f ... ~ (4)
ISO,tOO
)OO,tOO
S~.~
181 ,tOO
150,tOO
)00.000
586;100
18\.000
no/coo
300,000
616.001
18),001
150,000
300,000
646,800
181,too
150,000
»;),000
~1'l,loo
183,000
1"'1.000
lCO,OOO
111,100
18J,lm
~:~o
Sports C'QIl>le:x tortitM of ®bt ~rvic@ (5)
'lbtal dvailabl('
Nc .... dt<bt' ~m~ cr.'f\ts (M
Q:m-sp tlooun-coots
'J ~t '1\';l.i.L/(l:mt} -Nr~t year
~t d1jd.ll.! (r03t) -CU1IIlat i VP.
\l) ".,,'''' c loom
(2) Mter existing dPbt G('rvi~ Jlcl~t
o
48I,lm
(4Rl,000)
(481,00»
O} Cse of recla~ w.:at'?!.'" Ii. (f~~.itqn~ IXlOtrolR
'148,00)
18J,lm
o 1,191,00) 1.219,'100 1.249,000 1.Z19,SOO 1,)12.100 1,346,100 1.J81,o\:l()
1,331,000 l.m,1JOO l,))l,1JOO l,JJ1,(XX) l,JJl,OCI1 1,m,oro J,JJl.OCI1
481,001
(.till ,(00) U39,::m) {lll,.JOO) (82,000) (51,:l:llr (18.9001 15,100 '><).00)
(962,000) (1,101,200) (I.m.~l (l,2'l4,'JOO) (1,345,100) n,]&oI,/iOO) n,349.5001 \l,Z'l~,l(0)
(4) Il1C~ to area lIl'dian r4tro initially aM ~ ewry Yedr UleJ'haft@r
(~) TrolMtt"f fmn ~ra] tUtrl
{t;) O£t'1 p.lid frm. lllSUE"-k<l}HtilJir300 interest) dudng ('(hStructim
)
• , .. :
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TABLE 9 • CITY OF PALO ALTO GOLF COURSE
CAPITAL PROJECT FEASIBILITY ANALYSIS· PPOJ[CT 2
PROJECT 2 . COURSE RENOVATION, S5.0 MILLION
IminO) Im/93(l) 1993/')4
-~--'---~ ~--
Solret' of IN'@I1UP/CClat saving-Ii
Net rr.venue, t.'Urrmt operdtifll (2) 150.000
Q'lPr<lf iTJ) experu;e savingIJ (3) 300,000
Greetl f~ ifll-TOage (4) 5')8,80)
-------~---
'lUtal availtWl~ 0 0 1.008,800
NPv dt>bt SPrvice C"OStB (~) 605,000
O:Uroe cloou~ cn:;ts JI2,ooo 352,000 ---~-------
NPt avail./Ccoot) -CUrIl'Ilt )'f'dr (112,000) (352,0001 403,800
Nt!t ii.vail./(coot) -C\aI.lative (312,0001 (104,0001 (300,200)
(t) OJIlrne clooe.J
(2) AftlPf oostinq d~bt S('rvice pol)'ll8tt
OJ l'~l(Io of reclainn1 water &-~xpenditu~ {U'ItrolLJ
(4) IncnID8j to .1rN mdian ratee initi"Uy alii ~, ~e .. Y year tte~fter
(S) Coots paid frun irmue (Clpitalizro intet'eOt) duriIq ccmtm:;tim
", ,~--or""'r" __ .--~---.-~--.--. -
""':~ffl'W'f'--~' ·",r,-'T t";'
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1994{95 1995/% l"%{~1 1997/98 l'l'lll/!1'1 19'1'1/00 .I;
---------_ .. _---~----~--
l~,OCKJ 150,<XX> l!iO,OCO 150,000 150,000 1'>O'~ _lOCI,OOO 300,000 300,000 300,000 300,000 300,
586;/00 616.00:) 646,800 619,100 713,)00 148,800
--~---_._------------~------~--
1,036,700 1,066,000 ; ,096, 8():) 1,129,100 1.163,100 1,198,800
6O'i,ooo Wi.OOO 605,000 ru"ooo fQ."OO') 60'>,000
-----_._---.",.-._--------------
41;1,700 461,000 491,800 '>~4,100 S't8,l00 'iJ).800
Ill. 500 59?, ':iOO 1,054,3,M) 1,608,400 2,16<>,500 :-',7f1J,Xf)
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El Qunino Park Lease Option
Separate 3....'I'l.d apart from golf course capital budget discllssiot1S. the ciiy real
estate divi..sion is pW'Suing .a1te.matives 10 its FJ Camino Park lease l"1ith Stan~
ford University· (lessor) in an effort to stem rapidly increasing lease payments
which are based on increasing appr.i5ed values. The city is contractually com
mitted to an agr=<mt in which the lease payments exceed the benefit gained
from use of the park site. Total lease payments oC approximately $500,000
per year are currently included in t.'l. parks division budget. Al'Proxirnately
$313,000 of that payment is applicable to the portion oC the lease devoted to
parks ane! open space Pl1l"]'OOes. Sir,ce the sports complex included ir, Proj-
ect 1 could be used as an alternative for current rt.'creaconal llSI::S at El Camino
p~ applicable lease sa\.fugs and costs were reviewed and evaluated as a
SOUl"Ce oC additional fu.'1ding fer Project 1 costs.
Table 10 demonstrates projected lease payments applicable to the parcels dedi·
cated as parkland by a 1965 vote of city residents. Discontinuance of the
recreation portion of the lease would reduce the parks budget by the estimated
lea •• payments oC $381,000 by the time a reconstructed course could open in
1993/94. [.ease savings could be used to offset net Project 1 costs shown in
Table 8 ($J39,000 in the first year of operation).
Lease savings from the purchase of the property and conversion to ather uses,
however: are subject to successful negotiations and one~time costs of up to
$10 million.
• City staff has advised that purchase of the property through an eminent
domain proceeding would require an offer to Stanford based on 2 market
value estimated at $9 million.
• Withdrawal oC the land from the Williamson Act Preserve to allow an
alternate use would require • withdrawal penalty of approximately $1 mil
lion to obtain use of the property in less than five years. T!lls cost could
be paid from lease savings prior to the opening of a reconstructed course.
• Conversion of the land from park use woul d require a ballot measure for
removal of the park dedication of EI Camino P .... k.
In SUItlIMlY. if lease alternative negotiations are successful, applicable cost sav
ings would offset Project 1 net casts. Na"·galf<ourse revenue funding, how
ever, would be required for one-time buyout costs estimated at $9 million. If
lease termination negotiations result in significant bUY01 .. t cost reductions or if
the ciry elects [0 fund these capital costs from sources other than golf course
revenue sources, Project 1 feasibility could be r~uated.
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CONCLUSIONS AND RECOMMENDATIONS
Course deterioration and incre~d mamtenam:f costs will require capinil proj
e~{ costs to correct these problems and provide a course L'\at comperes in the
market area. Golf coun;e demand is strong and growing, par:iculady in the
citi. comparable market axea. An improved city facility will benefit from this
deI1'l&!td and result: in increased revenues that can be used to offset capital im·
provement cost.-r.. City staff has explored 'V"a..rious golf course capital improve
ment options. Fwther action on MO recommended options has been deferred
pendlng results of this fe .. ibiliry analysis. The conclusions of the feasibility
analysis axe as follow>:
• Existing golf course fi.'UIIlce policies and objectives stress a self·supporting
operation. Continued application of this pelicy is recommended. It is
coIlS"'.l5tertC with other municipal C:OtU!:ie5 in the market area. Further, golf
course demand is high and should support such a pobcy.
• Current course green fees are well below the median for the market area
but still provide a net revenue of about $lSO,OOO per year after payment
of current debt service.
• Water costs have increased dramatically in recmt years. Drought condi
tions have necessitated repeated rate inc:reases for pota't.ie water. The city
has a permit from the state to use reclaimed water far various irrigation
uses, including golf courses. It provides atJ. alCe:Illl\:tive source that not
only achieves water conservation but should also result in cost savings to
the city of about 5243,000 per year. AttJa! savings will dopend on the
blend (if any) with potable water.
• Either Project 1 or Project 2 will result in an improved f'cility that would
permit a fee increase to the median level without a reduction in roWlds played.
Project 1 will probably not support fees significandy higher than those for
Project 2. Inaeased revenue from a fee ir.c:rease to the median is e.s tim.ted
at SS08,OOO per year in 1990/91 and $558,800 at 1993/94 levels.
• Grant or loan funding is not curr.ntly .,'Bilable to assist "ith golf CO\lISe
reno\;ation projects.
• Annual debt financing costs are estimated as follow> based on CUITent
bond market conditions includL"1g I! net interest COS! of 7.5 percent:
Project 1 ....•.•..•..•.. _ ........... , $1,331,000
Project 2 ..•.•.........•.•..... ..•.. _ 605,000
• While a combined sports complex/ golf course renovation project 0. e.,
Project 1) would provide an alternative to sports uses at El Camino Park,
the city'. abiliry to tenninate it. lease of El Camino Park and allow alter·
nate uses of the property requires voter approval as well as successfu1 ne·
gotiations with Sranford Univemty Oessor) or eminent domain proceedings.
No savings in lease expenses can be realized without expendit\ll'e of over
$10 million for property purchase and removal from the Williamson Act.
22
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• Project 1 is not self-,upporting. It wculd >equire an annual general fund
conm'bution of approxiIrnllely $139,000 L'litiaJly, as well as COllI'S<! clos",""
costs of $962,000. If the city proceeds with the termination of the Ei
Camino Park lease~ the resultant savings could be used to offset net Proj
ect 1 costs but othel ge'IeraI fund contn'butiJn5 would be required for
one-time buyout cos.ts estimated at $9 million.
• Project 2 is self-supporting. [n addition, estimated reve.nues would sup-
port up to $8 million in project costs.
This feasibility analysis will assist the city in its 1991/92 golf cou= capital
budget formulation. Upon approval of a specific project and funding alterna
tive) it !s recommended that the city.
• [nclude the project in the cit-Is work plan and in its budget
• Develop • master plan
• Secure de:'t financing
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Hr-. Paul Dias
Director of Parks and Golf
City of Palo Alto
Palo Alto, CA 94303
Dear Paul:
Attachmerlt D
Au.;ust i, 1991
~~ne Strong, Secretary of our Corporation, and I pn}ayed
attending the special me~ting of t,be Golf Course Advisory Committee
on July 25. 1991. You did an excellent job Df explaining the history
Df the Golf Course, the probleThB that beset it, and the different
Capital Improvement Projects that are being considered.
It was interesting fcr the people present at the Meeting to
review the Golf Course Capital Project Feasibility Study corlducted by
Bartle Wells Associates and to hear ~hat action is necessary if the
Golf Course is to remain a viable asset to the City of Palo Alto.
Members of the Board of this Corporation are of the opinion that
Project 1. as detailed in the above Study. and which calls for a
complete reconstruction of the Golf Course, is not practical or
feasibile and should not be further considered.
We are a~are ,ho~ever. that capital improvements must be made to
prevent the Golf Course from complete deterioration, eo we urge tha~
Project 2, as spelled out in the Feasibility St~dy. be impiementd as
soon as possible. We offer our full support tD you in your efforts to
bring this about. Please feel free to calIon us at any time.
~e recall that the City Co~ncil, in authorizing the erection of
an office building at the end of the Drl\·i~g Rang£ sev~ral years ago,
agreed to consider much needed capital improvements to the Golf
Course in th~ future. It ~ould appear that the t~m€ has come to make
these propcsed capital improvements a reality.
:{i2c ere 1:: 1
?,~-'~:~)i> rt ey, /g~e'idrn
3388 S~ Michael Dr.
cc: Board Members
Palo Alto, CA 9~306