SalemNews.com, Salem, MA

Local News

March 10, 2014

Golf club company's revenue figures have holes

Monthly reports to city left out totals

(Continued)

Preliminary figures compiled by the city at the request of The Salem News showed that the Golf and Tennis Club produced just over $1.5 million in gross revenue for 2013. As of Friday afternoon, the city did not have complete figures available for the other three years under GFMI’s management.

According to a report by the Massachusetts Office of the Inspector General on municipal golf course management contracts, cities and towns should know how much money vendors are making before they enter into any agreements.

In a letter introducing the report, then-Inspector General Gregory Sullivan said, “Many municipalities appear to have no assurance that they are receiving a fair share of revenue from vendors.”

“Knowledge of a facility’s financial status is critical for municipalities,” the report said. “It is one of the best methods to ensure the course is being operated properly and in the taxpayer’s interest.”

Golf Facilities Management co-owner Chris Carter said he submits monthly reports to the Beverly Golf and Tennis Commission that break down the number of rounds played and the revenues from the club’s 19th Hole Pub. But he said the reports do not total the monthly revenue.

Carter estimated annual revenues have gone up “5 to 10 percent” since 2010 when the company first took over.

“It’s not an easy industry to spit out a formula and see what it’s worth,” he said. “It’s highly affected by weather.”

Beverly Golf and Tennis Commission Chairman Bill Lowd said the commission does not know the company’s annual revenues, but recommended its contract be renewed based on their performance.

“They’ve been terrific,” Lowd said. “The course itself, the overall facility, has made tremendous strides in coming back to one of the better golf courses on the North Shore.”

The commission voted 7-0 to recommend that the city exercise the option for GFMI’s contract extension, saying the commission has “worked very well” with the company.

That cooperation is a contrast from the city’s relationship with the two previous companies that managed the golf course. The city is still trying to collect payments from Bass River Golf Management and also had several legal battles with Johnson Golf Management.

Staff writer Paul Leighton can be reached at 978-338-2675 or pleighton@salemnews.com.

 

 

GFMI’S PAYMENTS TO CITY

Under current contract Option for next five years
  • 2010: $310,000
  • 2015: $380,000
  • 2011: $325,000
  • 2016: $390,000
  • 2012: $340,000
  • 2017: $400,000
  • 2013: $355,000
  • 2018: $410,000
  • 2014: $370,000
  • 2019: $420,000

 

 

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