Citizens concerned Iron Eagle drains city funds

Gary Hunt searches for his golf ball as Martin Enderle moves their cart along the fairway of hole No. 5 at Iron Eagle Golf Course in North Platte. The 25-year-old public golf course's ownership remained unsettled as 2019 ended, despite public debates in June and September.

Finances at Iron Eagle Golf Course have seen renewed scrutiny as a group of concerned citizens have circulated a report this week highlighting the amount of money the golf course has drained from the city’s general fund in the last eight fiscal years.

During that time, according to city-commissioned audits by the Grand Island firm Almquist Maltzahn Galloway & Luth CPAs and compiled by the citizens’ group into the report, the average annual net operating loss for the course has been $212,629.

In addition, the municipal golf course fund’s deficit balance has risen to $2,941,853.

The city has also been paying off the final years of the original bonds that helped finance the course’s construction. While those bonds were paid off in December 2017, the city has used $1,235,000 from the keno fund and $950,000 from the general fund in the past eight years to help fulfill those bond notices.

The group’s frustration, local businessman Alan Erickson said, has stemmed from the sustained deficits and increased debt that the golf course fund owes the general fund.

“It’s the same thing every year, and it’s not getting better,” Erickson said. “They’re budgeting a break-even or close-to-break-even strategy” and continuing to show deficits.

“Even though they’re

borrowing the money from themselves — which has to be paid back from an accounting standpoint out of taxpayers’ funds — they’re not doing anything about it,” he said.

City Administrator Jim Hawks confirmed the report’s figures Thursday and said the deficit funds that have been moved from the general fund to the golf fund will have to be paid back. City officials, he said, are hoping that renewing the city’s management of the course — the contract between the city and Landscapes Golf Group of Lincoln, which has managed the course for the past 6½ years, severs at the end of September — and the relief created by paying off the bonds in December 2017 will help put the course in the black so that those funds can begin to be paid back.

“I’m hoping now that we have it back in the city’s hands, we can get better control on the expense side of things and get that balance paid down even faster,” Hawks said.

Proposed budget figures presented at the Aug. 14 budget hearing have the golf course’s budget lowering from $685,450 in fiscal year 2017-18 to $577,279 in fiscal 2018-19. That includes a $116,279 transfer from the keno fund and $25,000 from property taxes. The latter figure is down from $250,000 in the fiscal year 2017-18.

During those eight years, the annual deficits have ranged from $157,194 in fiscal 2010-11 to $305,374 in fiscal 2016-17, according to the report.

In that time frame, the course has dealt with floods in September 2013 and May 2015, the latter of which contributed to the course’s lowest revenue generating years in fiscal 2014-15 and fiscal 2015-16 — $251,255 and $238,372, respectively.

“It did cause some additional money to go out there and fix that up,” Hawks said. “The second one came and lasted for quite some time, and that really held up the play out there. The worst thing is the revenue side, because when it was flooded and even after they opened it back up, they had five or six holes they could actually play, so the revenue side went down dramatically.”

Hawks said revenue during the last several months has been “as high as I’ve ever seen them.” After the 2015 flood, “we did do some things that will help protect it a little bit, but there’s nothing that guarantees that it won’t happen again,” he said.

Mayor Dwight Livingston said Friday he was unsure whether the City Council would take further action with the golf course, but that he personally thinks the course could break even within the next two years under city management.

“I’d like to see that happen,” he said. “It’d be terrific if we could change direction and get that to happen.”

That isn’t the only contributing factor, Erickson said: With four golf courses — three privately owned — in the immediate North Platte area and a fifth course near Sutherland in Lincoln County, attracting enough golfers to break even can be difficult.

“Golf, in general, is different than it was” when the course was opened in the early ’90s, Erickson said. “The demand is not there. You have plenty of golf and plenty of property-tax-paying golf courses that are competing with a public, non-property-tax-paying entity that is losing money and taking money from taxpayers. Something has to change. ... You can’t keep doing the same thing and expect different results.”

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