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Several hundred people attended the public forum at Cheney Middle School on Tuesday, February 17 in which city officials discussed the golf course project and what it could mean to the city of West Fargo. Jay Pickthorn/The Forum

Questions remain after golf course talks

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Approximately 200 people turned out for a public forum Tuesday evening, Feb. 17, at the Cheney Middle School to learn more about a proposed 18-hole municipal golf course in the Westport Beach Development.

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Basic information was presented, but when all was said and done after the two and a half hour session, it appeared a lot more questions remained, in particular, those involving the specifics of costs related to the project and the impact of those costs.

The meeting was initiated by Commissioner Mark Simmons as the result of substantial negative feedback he had been receiving regarding the course, mainly attributable to the lack of factual information shared with the public prior to the commission's 3-1 vote last December to move forward with the project, as well as the potential effect of such a course on city taxpayers.

Introductory presentations were made by Commissioner Simmons, who served as facilitator for the session; City Administrator Jim Brownlee, who provided a history on the storm water retention lake concept; and Larry Weil, who offered a history of the city's comprehensive plan, noting an interest expressed for a municipal golf course.

Presentations followed by Westport Beach developers Kevin Christianson and Jim Bullis, who explained plans for the course, before opening the floor to a question and answer session involving West Fargo residents focusing on a variety of issues and concerns.

Westport Beach has donated approximately 160 acres of land in a 520 acre tract to the city for the course, north of 52nd Avenue West. The city has agreed to construct the course and will be responsible for management, maintenance and operation. In the process, the development will realize a $6 million storm water retention system.

Christianson noted that Westport Beach has been in the developing stages since 2003, with 450 lots already existing. He said they struggled with the first phase and have since been exploring a variety of development options with the consensus that Westport Beach land configuration lends itself perfectly for a golf course and new housing opportunities. Westport Beach also built the nine-hole golf course at neighboring Osgood starting in 2003, with Christianson saying they built 1000 houses in five years.

Mentioning that the city has already expended almost $30 million for core infrastructure projects south of the interstate to provide services for developments, the school, and future developments, he said the addition of the golf course development could help dilute the $30 million in costs with more taxpayers growing the city.

He projected $300 million in taxable valuation once the project is built out, resulting in $6 million in tax revenue for the city.

The housing on the course is intended to be built out in phases as demands warrant it, with phase I consisting of seven lower priced homes, 63 medium priced and 27 premium homes. Total plans call for a projected 670 residential lots in addition to a large tract for townhomes. The estimates for values on the homes have been set at $700,000 for premium homes, $435,000 for medium priced, and $237,000 for the lower priced homes.

The golf course will be paid for through assessments to the landowners in that area for storm water retention as well as assessments against the lots owned by the developer for construction of the course and the clubhouse. The city will pay for the project by bonding after it is completed, and pay the bonds with the assessments against the properties.

In the prepared comments, it was also stated that no other landowners in the city would be assessed for the expense of the golf course; however, the city would be assessed for the storm water assessments on the property given to the city for the course.

The city of West Fargo will require the developer to post a bond for 50 percent of the improvements. If the land should come back to the city for back taxes, the city would own all 520 acres with the land paid for and half of the improvements paid, enabling the city to sell the lots.

Nobody at the meeting could offer any concrete figures regarding actual cost, saying they would have a better grasp of that once forthcoming design plans from Lehman Design Group, Scottsdale, Ariz. become available in the next couple of weeks.

The cost of the course has been estimated at $6.7 million, with $4 million of that for construction of the golf course; $1.5 million for the purchase and remodeling of a building already existing there into a clubhouse; and a $450,000 contingency reserve put aside to cover operating losses. It is also the intention for city staff to oversee the course as a newly-created city department, projecting a $630,000 to $750,000 per year operating budget they expect to cover through golf course generated revenues.

Total cost for the design contract with Lehman is $500,000, with $25,000 paid upon signing the contract and another $75,000 due before bidding. This expense is also included in the $6.7 million estimate.

The city had hired HVS Golf Services over a year ago to conduct a study to determine if a course would be financially feasible. The city picked up $2500 of the $16,000 for the study, with the developers paying the rest.

"The study said: "The golf course is projected to have net losses in the $75,000 to $165,000 range each year. The golf assessments should offset these losses by a magnitude of $177,000 annually upon stabilization. Overall, however, the operation of the golf course is not expected to provide sufficient income to pay annual operating costs or what would be needed to pay the debt service payments incurred for the construction of the golf course, especially considering the golf assessment will eventually expire."

The report went on to say the proposal could be financially feasible if the city adhered to a number of stipulations including having the clubhouse donated to the city along with the land ($1.5 million has been included in the projected costs for the clubhouse); the budget is adjusted; and the city looks at different sources of revenue.

When the questioning phase of the discussion began, Al Vetter, who lives south of the Interstate, was the first to receive the microphone, asking how many in attendance supported the golf course. By a show of those standing it appeared that about 60-70 percent were in opposition.

When asked why the park district was not spoken to first about the golf course and why the matter wasn't reviewed by the planning and zoning commission before it came to the city, the response by Bullis was there had been discussion with the park board first and they elected not to participate. As for not informing the P and Z, Bullis said there was no plat attached to the plan so they talked to the commission about gauging interest almost a year and a half ago, when the topic first came up.-

Richard Roberts told the group he didn't' think the city should be spending money. "Your job is to provide services to all of West Fargo. Charge them (lot owners) each $11,000 more and let them build their own golf course."

Bullis responded to the comment by noting that if the golf course were private, it could only be used by the club members and it wouldn't benefit school or other uses.

Jack Fuller addressed those gathered saying "If you are using Osgood as a benchmark, why after three years of operating are they in the hole? There is not a course in this area breaking even. We've got better places to put our money. They will be asking us to vote on new school buildings. All this will fall back on the city as a whole. The night you adopted the vote, Commissioner Schulz was absent and Commissioner Thorstad was the lone opposing commissioners. Why did he vote against it, when three other commissioners were for it?"

Christiansan said a golf course would be a good way to get the people out to the developments south of the Interstate looking for something to do in that area. "Let's think about the math in this equation. It's not like we are trying to create this new widget that doesn't exist anywhere else."

Jake Lauritsen said he was expecting to see two charts outlining the costs and the expenses. "You are discussing things you understand greatly and I don't. Communication is lacking. Communicate so anyone who comes to the meeting knows."

Former City Commissioner Brenda Warren noted that she has been involved with the golf course since day one and also against it since day one. "I didn't come to that conclusion lightly. When I studied the HVS report I was alarmed. I called them at that time and they said, 'Brenda do not build this golf course, it is not a good thing for the city.' HVS Services is a highly respected consulting firm. I called them again today and asked, do you still stand by that, and they said they did and that the city will not be able to support the debt service."

Then Warren asked what the expected annual debt service on this multi-million dollar bond would be and was told once a cost was arrived at it would be bonded and paid for by special assessments?

Commissioner Mike Thorstad spoke next responding to an earlier question as to why he voted 'no' on the course. "I don't begrudge you guys," he told developers, "but the number one thing I heard from citizens when I was running for office was my 'specials and taxes are killing me.' Here we are looking at a project that will cost the taxpayers money. I could go on and on about other city projects coming up soon. We need the money, and yes, we've got money set aside, but it all starts in one place, your pocketbook," he said to those attending. "We need to look at what a golf course will cost West Fargo on an ongoing basis, including general and administrative costs which are also incurred by the city. Where will we get 20,000 rounds of golf play so that we can keep our losses to a minimum?"

Rhonda Hawley asked what the cost would be to taxpayers each year on a $200,000 home if the golf course lost $300,000 a year, with the answer $32 per homeowner based on $67,900 per mill.

Mick Hammerstrom asked how many citizens were involved in the comprehensive plan Larry Weil referenced as expressing a need for a golf course. Weil responded that 7500 households were surveyed, with a two percent return.

Hammerstrom said his concern is the well-being of the city, mentioning the need for a long range forecast including cash flow projections for the various capital improvements underway. "I assume the city commission understands the budget. I think it would be good judgment for our city commission to hire an outside independent third party to look into the numbers annually. I think it's critical. We're supposed to be securing 50 percent of the pledges on bonds. I've heard in the city we are not doing that. Outstanding assessments on undeveloped lots may be a large potential liability for the city, and I would like to see some numbers that show the city can handle this along with all the other projects. We need to be on top of our financial condition."

Brownlee responded by saying the city goes through an independent audit every year, receiving an A-2 rating from Moody's. He said the city has a five year capital plan in place, also adding there are lengthy budget talks each year involving all the commissioners.

One of the final questions queried was what the assessments would be on one of the lowest priced lots in the proposed golf course development.

Christianson said those figures would not be available until details of the design were back, but when asked again, estimated the lot sale at $20,000 with specials at $35,000.

A sampling of unanswered questions that are floating around out there in the aftermath of the golf course meeting include: How many acres are involved in the $30 million core infrastructure projects already expended by the city? How much will the total cost of storm sewer assessments be per acre to the city for their share of the land? What is the total cost estimated for the golf course and club house, including the land that has to be purchased by the city? Why doesn't the developer pay 100 percent of the bond, instead of 50 percent? Has the 50 percent bond been paid? What level of contingent liability should the city be willing to accept for outstanding assessments? Why was the advice of HVS Services discounted at the meeting? How will personnel, maintenance and equipment for a golf course be funded? How will the course be watered if a citywide restriction is in place? Can this issue be decided by a citywide vote?

With all these questions and several more still looming, and based on the comments he's still receiving after the meeting, Commissioner Simmons said he feels the need to slow down a bit and try to secure additional information for everyone involved with this topic before further action is taken. "There will more than likely be another public forum before we vote on the golf course issue again," he concluded.

khuber@westfargopioneer.com

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