It’s Time To Stop The Spinning!
April 21, 2016
If you’d like to start a lively
discussion in Bellport Village, just mention the golf course. Some people
see the Village golf course as an asset, some see it as a liability, and
some, just want to play golf.
Contrary to what some people think, I see the golf course as a unique and
important asset that at times, just hasn’t been managed properly from a
financial point of view. I’ve been led to believe that at least at one point
in time, the golf course generated revenues that helped keep Village taxes
down. More recently, I’ve been led to believe that, to some extent, the
residents of the Village, who don’t play golf, have been supporting the golf
course for resident and non-resident players.
I used the phrase, “led to believe,” because there’s been a lot of either
intentional or unintentional “spinning” of the facts surrounding the golf
course, catering facility, and the rest of the area we associate with them
like the tennis courts, cell tower, and Pro Shop. At any given time, the
“spin” depended on the point of view of the person doing the spinning so
that the spin would support their particular point of view.
If you reviewed the Village’s budget, you noticed that “The Budget” is
really two budgets. Pages 1 through 17 cover Bellport Village as you’d
expect them to, but then the page numbers start all over again and pages 1
through 5 of this second budget are for what’s called the “Enterprise Fund.”
The Enterprise Fund is the golf course, catering facility, Pro Shop, grill
room and most other things on the Country Club’s property except strangely,
not the tennis courts. The tennis courts are listed as part of the overall
Village’s budget; they are not part of the Enterprise Fund.
I’m told by a property owner in the Village that the $80,000 or so income
from the cell tower is in the Village’s part of the budget, not the
Enterprise Fund’s part. That’s hard to tell for sure because like so many
things, the budget doesn’t mention income from the cell tower. I don’t
really understand why the income from the cell tower isn’t included in
“Rental of Real Property” income in the Enterprise Fund section of the
budget because that’s what it is.
I’m probably simply missing something here, but the Pro Shop at the golf
course seems to have strange numbers. We’re paying $210,700 for ”Personal
Services” which seem to be salaries. Then in addition, we’re paying another
$161,289 for “Contractual Expenses,” whatever they are, for a total of
Now, if the Pro Shop had gross sales of $500,000 and it costs us $377,000 to
run the place, including the cost of goods, that’s a good deal. We’d be
making a profit of $123,000, but according to the budget, the Pro Shop is
only expected to have sales amounting to $76,813. But Wait! That’s gross
sales of $76,813. What were the costs of the goods sold? We have to subtract
the cost of goods from the gross sales to know how much we made or lost, not
considering all the other expenses like salaries and “Contractual Expenses.”
Is listing only the Pro Shop’s gross sales in the budget an attempt to spin
Mayor Fell has said we have 70 new members at the golf course and that’s
great! However, what about attrition and the actual dollars those new
members have brought in? Just about every year we lose some members who
don’t rejoin for the coming year. Isn’t only mentioning the new members and
not ones we’ve lost spinning the information in a favorable light towards
the golf course? What if 100 members don’t rejoin? Wouldn’t the real story
be that we lost 30 members?
I mentioned the “actual Dollars” those new members represent because unlike
in the past when the number of different kinds of golf course memberships
were relatively simple, we now have all kinds of new memberships and special
discounts. I think this is a great idea and will hopefully attract new
members, but only reporting the number of new members is spinning the
numbers. What if those 70 new members were given free memberships for their
first year? As they say, “Show me the money!” Reporting the dollars and
cents of it is the only true way to know how we’re doing. Every business has
ups and downs. The important thing is that when things are down, what is the
business owner going to do about it?
Now, to a large extent, your opinion as to whether the golf course is making
money, losing money, or breaking even depends on what you feel should be
included in the “Enterprise Fund.” The current budget for 2016/17 shows the
Enterprise Fund as breaking even with $1,800,006 in income and $1,800,006 in
expenses. However, if you feel the income from “Rental of Real Property,”
$211,338 received from the catering facility and grill room, shouldn’t be
used to support the golf course and should instead be used to lower taxes
and support the Village over all, then you’re thinking the golf course is
going to lose $211,338 in the coming year.
Personally, I think the correct course is somewhere in the middle. While
it’s true that the golf course enhances sales at the catering facility and
grill room, I don’t think it accounts for 100% of their sales and therefore
only a portion of the income they generate should go towards supporting the
Now, I’m not a lawyer and I’ve only written two FOIL (Freedom Of Information
Law) Requests in my life (The Village now asks for them). I know what I want
to know, but I’m not sure how to ask Village Hall for the information. What
I’d like to say is, “For each of the past 15 years, 2002/2003 to 2016/2017,
what has been the net financial impact on the Village’s finances from the
physical area of Bellport Village known as the Enterprise Fund. That would
include the golf course, catering hall, grill room, tennis courts, cell
tower, Pro Shop, parking lots, irrigation systems, locker rooms and any
other source of income or expense in that geographical area of Bellport
Village.” By subtracting the expenses from the income for each of these
items for each of these 15 years, we can figure out which of these items are
assets, which are liabilities, what are the trends, and how we’re doing. If
any of you would like to take a try at writing and submitting such a FOIL
Request, Bellport.com would be glad to publish the results.
Click here for a blank FOIL Request form.
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