Binder Park Golf Course Report

Tel: 269-966-3355
e-mail: kssmith@battlecreekmi.gov
May 20, 2016

Kevin S. Smith
Recreation Operations Superintendent
City of Battle Creek
35 West Hamblin Ave
Battle Creek, MI 49017
Re: Review of Binder Park Golf Course Operations
Dear Kevin:
This letter comprises a summary of National Golf Foundation Consultings (NGF) review of the
City of Battle Creek (City) golf operation related to the 27-hole Binder Park Golf Course
(BPGC). This summary is based on NGFs review of this property in the winter of 2016. The
January 5-6, 2016 site visit included a comprehensive inspection of BPGC and meetings with
golf staff and Battle Creek officials. In addition, the consulting team utilized other information to
assist with our review, including NGF golf market research, in-market competitive data, and data
collected from previous engagements in the region dating back to 2008.
This review includes a strategic look at the Citys municipal golf offering, with a specific focus on
the recent performance of BPGC in light of concerns related to future profitability and ability to
cover scheduled bond debt payments. A key focus area for the NGF in this review is to help the
City establish the use of best industry practices in operating and marketing its golf facility, and
explore options to position the golf course to capture new sources of business. Other issues
addressed by NGF include the physical condition of BPGC, the market environment in which the
facility operates, and the operational structure in place, concluding with NGF recommendations
for maximizing the economic potential of BPGC going forward.
This NGF review was managed by Richard Singer, MBA, NGFs Senior Director of Consulting
Services, and Ed Getherall, MBA, Director of Consulting, with field work and other analysis
provided by Jerry Hinckley, Senior Associate Consultant. This letter provides an at a glance
summarization of the NGF review, detailing the main findings and NGF recommendations for
the City in the continued operation of BPGC. Full support and documentation is contained in the
body of the report.
We note that the findings and recommendations made by NGF are reflective of a limited view of
the operation, and are based on both on-site findings from our January 5-6 property inspection
and market review and our extensive experience in reviewing municipal golf facilities as well as
a detailed review of operational data from BPGC and the City of Battle Creek.
NATIONAL GOLF FOUNDATION CONSULTING, INC.

A Subsidiary of the National Golf Foundation
501 N. HIGHWAY A1A, JUPITER, FL 33477 (561) 744-6006 FAX: (561) 744-9085 www.ngf.org
OVERALL SUMMARY
In summary, NGF finds that BPGC is performing well in light of the fact that the market area has
many golf courses that reportedly are struggling to attract golfers. BPGC appears to be among
the better properties in the market area in terms of overall quality. Customer ratings by popular
travel and business websites for BPGC (TripAdvisor, Google, Golfnow) indicate that the
courses management team and staff are doing a good job in meeting or exceeding customer
expectations, and in many cases customers are giving BPGC their highest possible rating.
Management appears to have reduced labor and other costs effectively over the last few years
as oversupply, lingering effects from the recession, and other factors lowered the number of
rounds played at BPGC and other facilities in the market. Essentially, BPGC has been able to
cover its operating costs, which has become increasingly difficult in todays operating
environment, where one third of municipal golf facilities fail to fund on-site expenses(NGF
survey research). However, BPGC management and NGF understand that the City desires the
property to cover not only its operating costs, but bond payments as well. In order to improve
the success of the BPGC operation, the City and course management should examine several
of the best practices outlined by the NGF in this report and adopt or modify these and other
programs to help promote additional golf play at the facility.
The most salient high-level findings from NGF are noted below, with more detail and
documentation provided in the body of this attached report:
Management has maintained overall operating expense levels, including cost of

goods sold, at roughly $950,000 or less for the last five years. NGFs considers this
operation to be very efficient, especially given that 27 holes of golf are offered along
with a practice center and 3 practice holes. While BPGC has been affected by overall
weakness in the market, the facility has shown resilience by continuing to cover its
operating costs and providing good service levels. (NGF research shows that only
about a third of municipal golf facilities are covering operations and debt service).
Improvements in operating profit will need to come from increased revenues, not
expense reductions that might damage the long-term viability of the golf facility.
Total gross operating revenue (excludes annual transfer in from General Fund of
about $67,000) at BPGC fell from $1.1 million in 2010 to $975,000 in 2014, a
decrease of 11%. Revenue rebounded by more than 6% in 2015 after some rounds
recovery. The falling revenue at BPGC has been entirely a function of declining
rounds, as average total revenue per round increased by nearly 13% between 2010
and 2014. Every revenue category increased during that time period, though cart
revenue per round is virtually the same as it was in 2010.
NGFs observation of BPGC indicates the facility and its buildings are in good
working order, and equipment is being maintained properly. Under the current
operation plan, capital expenditures will generally be limited to golf course equipment
(mowers & golf carts) over the next several years.
The Battle Creek market area is highly competitive, with 18 golf facilities (16 public
access) within 15 miles of BPGC. Area operators report that BPGC is not unique in
experiencing play levels drop since 2008. Slumping demand helped prompt a recent
sale of Yarrow Golf Resort and Conference Center, and two other courses (Oakland
Hills and Cedar Farms) are reportedly for sale for under $1.0 million. Struggling
courses with a short-term focus are offering steep discounts to attract play, resulting
in a challenging operating environment for facilities such as BPGC.
The regional economy, including employment data, shows improvement over recent
years and should provide increased wages and demand for recreational activities,
National Golf Foundation Consulting, Inc. City of Battle Creek, MI - BPGC 2016 Review 2
including golf. Population growth in the City/County is expected to be minimal over

the next five years. Building permit data for 2014 in Battle Creek indicates that 10
construction permits were delivered for new residential projects, an indication that
new population growth will be minimal for the next couple of years.
BPGC is currently utilizing many industry best practices to successfully compete in
the market for golfers. That said, NGF has outlined some initiatives that could
improve profitability of the facility in the near future.
In addition to operational and programing opportunities, the closing of Yarrow considered a competitive upscale facility in the Battle Creek market - is expected to
yield increased public golf and golf events for BPGC in 2016 and beyond, especially
since BPGC has a good market reputation for quality and service. If the closing is a
sign that alternative uses will increasingly be considered on properties where nongolf use is feasible, BPGC may benefit from additional future closings.
NGF research documents that demand for weddings and banquets at golf course
venues exists in the market. The facilities observed that have the best ability to host
events, such as the Medalist, Battle Creek Country Club, and Gull Lake View Resort,
all have large clubhouses that offer full food and beverage service. Operators who
target the wedding market indicate that they host 10 to 30 events each year.
NGF did not observe any regional golf course having a lighted golf practice range.
BPGCs PGA Professional indicated that no facility is currently providing a lighted
practice center for golfers, lessons, or general recreation in the Battle Creek market.
EXTERNAL MARKET SUMMARY

External factors outside the control of management present challenges for strong economic
performance of BPGC. Below is a summary of key findings on the external market environment:
Though golf continued its macro trend toward stabilization in 2014 and 2015, sociodemographic, financial and cultural headwinds persist for golf, and the last recession
has had lingering effects on discretionary spending habits.
Strong golf demand and participation in the Battle Creek / Calhoun County area is
greatly mitigated by an oversupply of affordable, public golf courses. The 15-mile
market around the Binder Park GC has 61% fewer golfing households per 18
holes of public golf than does the nation overall, and 72% fewer golfing
households per 18 holes of Value price point public golf, where BPGC is
positioned.
With a stabilized population bases, no new golf courses on the horizon, and potential
further closures of existing courses, the local may become more favorable for
existing operators in the coming years.
FINDINGS & RECOMMENDATIONS

Closing or Selling BPGC
In addition to looking for ways to improve the economics of the golf course, the City has also
considered the implications of: (1) Selling the facility; or (2) Closing the facility.
Selling BPGC: NGF has been told that only a portion of the property (154+/- acres) could be
sold if that option were to be pursued. Reportedly, the 1963 donation to the City for the land
containing the original 18 holes and former clubhouse building was to be used for recreational
activities by the City of Battle Creek. If BPGC were to be sold, NGF believes it would be highly
unlikely for the City to find a buyer that would be willing to pay off the debt, unless the property
could be rezoned for a more profitable use. (The recent listing of the nearby Oakland Hills
course of less than $1.0 million is an indication that an expected price would likely not repay the
bond debt). If the City were to seriously consider the sale option, a detailed real estate analysis
and appraisal for the highest and best use should be conducted.
Closing BPGC: NGF has noted that BPGC even after a downturn in rounds played has
been contributing a positive net income, and funding minor capital items, before debt service.
When the debt service is considered in the context of being a sunk or fixed cost, it is hard to
justify closing a facility that is meeting all of its operating obligations and contributing some
funds toward debt service, unless there were a more profitable (and permissible) use of the
land. Closing the course would remove the cost recovery (revenue) element, while incurring
new one-time costs related to securing the site and demolishing unused structures, and
retaining other expenses (e.g., maintenance, employee legacy costs). Another consideration is
that a golf course also provides other indirect economic benefits (e.g, wages earned and spent
within Battle Creek, etc.), as well as non-economic benefits, to a community (see Appendix A).
In light of this discussion, NGF recommends that the City keep BPGC open and
concentrate on making the golf course a more economically viable operation, even if as
we are projecting it continues to fall short of paying all of the debt service.
Alternative Operating Structure Considerations

As part of the scope of the analysis, NGF also evaluated alternative operating structures in the
context of improving financial performance of the facility and meeting the Citys performance
goals. Our summary review of options, a discussion of which are included in the body of the
report, included: (1) Continued Self-operation; (2) Concession Agreement(s); (3) Full-service
Management Contract; (4) Operating Lease; and (5) Hybrid Contract.
NGF concluded that, in this difficult operating environment, even a highly skilled management
company may find it difficult to drive enough incremental revenue to pay for the annual
management fee that will be added to the expense structure. In theory, an operating lease that
would provide payment to the City of $250,000 - $300,000 would be a solution allowing BPGC
to cover all obligations, including bond payments. However, based on the operating results of
the last several years at BPGC, as well as the fact that some golf courses in the market are for
sale at modest prices, NGF believes it is very unlikely that an operator could be found to
lease the facility under terms acceptable to the City.
Overall, NGFs analysis of BPGCs self-operation structure revealed that current management is
successfully delivering good service and holding operating expenses low to enable the facility to
cover all operating costs and provide capital for small projects and equipment. Therefore, we
recommend that the City stay with this structure, at least for the short term, and that
management enact some of the best practice recommendations from this report in an attempt to
improve the overall economics of the golf operation.
Operational Recommendations
In the body of the report, NGF provides recommendations that should help grow rounds and
revenue at BPGC. These recommendations are based on the NGF consultants experience and
expertise, but stem from a limited review of the operation and facilities. We also recognize that
many of these items are already being enacted, but that some may simply require more focus,
resources and attention. Our recommendations include improvements to marketing,
enhancement of electronic capabilities (website, email, etc.), direct selling to grow tournament,
league, hotel, and meeting/banquet business, improved signage, player development, and an
increased emphasis on growing female and young adult (millennial) golf participation. These
recommendations require limited investment and focus on best practices that NGF has
observed in the golf industry that can help improve service, increase revenue, and control costs.
Analysis of Potential Revenue Enhancing Projects

NGF has reviewed the potential for alternative business opportunities at BPGC to determine if
capital investment could be made to improve profitability and help to provide more income to
support bond payments. After interviewing BPGC and City staff, and conducting a detailed
property inspection, two key projects have been identified for consideration. They are (1)
hosting weddings and non-golf event banquet business, and (2) installing lights to extend
business operations at the golf practice range.
Wedding / Banquet Facility Addition
Two potential sites at BPGC have been reviewed to locate an expanded/improved facility to
serve larger golf events, banquets, weddings. The options are: (1) A new/expanded
meeting/event facility at or near the current clubhouse; or (2) A meeting facility utilizing the
former clubhouse that is situated in the southeast corner of the property. NGF concludes that a
facility created at the existing clubhouse area would be more profitable and less costly to
construct, based on the expected added costs involved with repairing and improving the former
clubhouse site to be equal or better than the current clubhouse.
Wedding and Banquet Alternatives
In reviewing site options near the existing clubhouse, as well as the physical structure of the
clubhouse building and its amenities, NGF identified three options:
1. Construct a freestanding permanent building
2. Construct a freestanding tented facility with foundation
3. Extend the size of the existing outdoor pavilion by extending the roofline and installing
tented siding
Each option has strengths and weaknesses (details in body of report). These include cost,
functionality, longevity, and how they impact existing operations. With an expanded kitchen
capable of serving a larger menu and facilitating larger events in-house, seasonal or full-time
cooks/chef would need to be hired to staff and operate this new business operation. Therefore,
if the City proceeds with adding the banquet operation to BPGC, NGF recommends that a study
be conducted to see what equipment could be added that would serve the golf course as well as
banquets, and to estimate additional staffing costs. For the purposes of our incremental net
revenue analysis below, NGF has assumed that all events of any size will be catered.
Projected Financial Impact Wedding/Banquet
In the summary table below, we present the projected financial impact of the three subject
wedding/banquet options for BPGC. Estimates do not include potential incremental revenue for
golf events resulting from larger facilities. .
Estimated Capital Cost

Projected Annual Stabilized Revenue
Proj. Ann. Stabilized Profit (Year 4, 33% Margin)
Estimated Years to Capital Payback
New Building
$
750,000
$
300,000
$
100,000
9.0
Extending the
Pavilion
$
385,000
$
225,000
$
75,000
6.5
Freestanding Tent
Structure
$
225,000
$
225,000
$
75,000
4.4
NGF Summary Wedding/Banquet Addition

The three options discussed essentially offer small, medium, and larger up front investments to
meet the goal of serving the wedding and banquet market. NGF projects that each would return
positive incremental net income to the City.
The permanent building offers the chance of the greatest return, but also carries the
longest payback on investment, the highest upfront investment, and greatest risk if
revenues are less than expected.
The pavilion extension with adjoining event-wedding ceremony lawn - offers a
facility that has functional capabilities, an attractive site location with ample parking,
and potential for full enclosure. A more permanent structure (roof and floor)
somewhat mitigates weather issues, although the functionality will remain seasonal.
We project the tented structure to produce a similar net income to the extended
outdoor pavilion and at a lower upfront cost but without providing the flexibility of
the pavilion extension if demand is stronger than expected.
Ultimately, the decision to invest in some type of wedding/banquet capabilities becomes a public
policy decision. While NGF projects all three options to improve the net operating income of
BPGC, they also will add new capital costs that must be paid off before any incremental net
income could be applied to the existing debt.
Lighting the Practice Range

NGFs review of area courses indicates that the market lacks a lighted driving range. Given
BPGCs large practice range, First Tee facility, and active lesson program, a lighted practice
facility if it can be permitted - can offer players of all skill levels the opportunity to enjoy and
learn golf in the evening after work or school or simply as another source of evening
entertainment. Given the long-summer days in Battle Creek, the major impact of having lights
will be in spring and fall when evening temperatures are mild but daylight hours are shorter.
NGF projects that BPGC will be able to increase range revenues from the current $0.55 per
round to $0.85 per round, based on incremental hours and creative programming at the range
(examples provided in body of report). At these per round numbers, payback on a $20,000
investment in lights (repurposing C.O. Brown Stadium light poles) and new ball machine should
occur within 2 years.
FINANCIAL ANALYSIS - CASH FLOW RESULTS

NGF prepared a cash flow pro forma for BPGC with operations through 2020 similar to what is
currently in place at the facility. The pro forma reflects implementation of key NGF operational
recommendations, but does not reflect any potential incremental revenue associated with the
considered capital improvements considered in this report - banquet/wedding structure or
lighting the driving range. Overall, the main impact of the pro forma is to highlight potential
rounds increases that will be the main engine to drive improved economic performance.
The NGF forecast, based on rounds played recovering to the 40,000 range, shows BPGC net
operating income increasing moderately over what was achieved in the 2011 through 2015
period. Net operating income (excluding Transfer In, and before CapEx Reserve) is projected to
stabilize in the $100,000 range. The property will continue to fall short of generating cash flow
sufficient to meet debt needs under the present bond structure. Based on the estimated 2016
through 2025 annual Bond payments ( $240,000), the operation, after set aside for CapEx, will
fall short of covering the total debt service by an estimated $180,000 to $190,000 each year.
SUMMARY STATEMENT
In Binder Park GC, the City of Battle Creek owns a good quality, popular and well-managed golf
course asset that has - like many municipal facilities across the U.S. - suffered significant
declines in activity levels over the last 5 to 10 years. Despite a difficult market environment,
most notably an oversupply of affordable public golf, City staff and golf course management has
been able to keep BPGC above water operationally, while contributing some funds toward
annual bond payments.
The NGF review revealed the following summary high-level takeaways for the City to consider
as it plans for the future of Binder Park GC:
Though there are signs of improvement in the local economy, and its possible that
further golf course closures could make the supply/demand dynamic more favorable
in the coming years, the trade areas stagnant population base will preclude
meaningful organic growth in activity. Management should focus on operational,
marketing and programming enhancements to drive growth in rounds and revenues.
NGF has concluded that selling (portions) or closing the golf course is not a viable
solution to the debt shortfall. The City should view the existing debt as a sunk cost
and focus on improving the operation to maximize cost recovery from the golf
course.
Alternative operating structures such as a full-service management contract,
operating lease or hybrid agreement will likely not put the BPGC operation in a better
economic position. NGF recommends that the City continue to self-operate, while
implementing key best practice recommendations from this report and considering
new investment.
The City has several options for new capital investment in the property that should
increase net operating income at BPGC, including lighting the driving range and
adding wedding/banquet capabilities. NGF analyzed several options for the latter
improvement and concluded that each option would return positive incremental net
income to the City. The City must decide whether it is willing to take on additional
investment that we project will have a payback of about 4 to 9 years, depending on
the option chosen.
At least over the immediate five-year horizon, incremental net revenues resulting
from enhanced operations and new revenue sources are likely to still leave BPGC far
short of entirely covering annual Bond payments.
Kevin, we appreciate your confidence in the National Golf Foundation and its consulting
services, and we have enjoyed the opportunity to be a part of your planning for Binder Park Golf
Course. We are hopeful that the information and recommendations NGF has provided will assist
you and City officials in your upcoming decisions on these golf properties. Richard, Jerry and I
look forward to your questions and hope you enjoy reading the consulting report.
Sincerely,
Ed Getherall
Director of Consulting Services
egetherall@ngf.org
Table of Contents
INTRODUCTION ....................................................................................................................... 1
Purpose .............................................................................................................................. 1
Background......................................................................................................................... 1
NGF Review 2016............................................................................................................ 2
BINDER GOLF COURSE OVERVIEW ...................................................................................... 3
Location and Access ........................................................................................................... 3
History................................................................................................................................. 4
Current Operation ............................................................................................................... 5
Facilities......................................................................................................................................... 5
Operating Structure and Staffing................................................................................................... 9
Golf Fees ............................................................................................................................ 9

Capital Projects/Equipment Review .............................................................................................. 9
Marketing ..................................................................................................................................... 10
Activity and Financial Performance ............................................................................................. 10
Bond Debt Schedule.................................................................................................................... 13
Binder Park Golf Course - NGF Summary 2016..............................................................13

EXTERNAL MARKET ANALYSIS SUMMARY ........................................................................14
National Trends..................................................................................................................14
Local Market ......................................................................................................................15
Battle Creek Area Demographics................................................................................................ 15
Economic Factors........................................................................................................................ 15
Golf Demand ............................................................................................................................... 17
Golf Supply .................................................................................................................................. 17
Golfers per 18 Holes.................................................................................................................... 18
Golf Course Market Supply / Demand Summary ........................................................................ 18
Key Market Competition .............................................................................................................. 18
External Market Summary..................................................................................................23

FINDINGS & RECOMMENDATIONS .......................................................................................24
Key Findings - Binder Park Golf Course.............................................................................24
Closing Or Selling BPGC ...................................................................................................25
Alternative Operating Structure Considerations..................................................................26
General Recommendations to Improve Operations and Marketing ....................................27
Analysis Of Potential Revenue Enhancing Projects............................................................29
Wedding / Banquet Facility Addition............................................................................................ 30
Lighting the Practice Range ........................................................................................................ 40
NGF FINANCIAL PROJECTIONS............................................................................................43

NGF Projections 2016 - 2020.............................................................................................43
Results...............................................................................................................................45
SUMMARY STATEMENT.........................................................................................................46
APPENDIX ...............................................................................................................................47
Appendix A Non-Economic Value of Public Golf..............................................................47
Indirect Benefits to City of Battle Creek....................................................................................... 47
Specific Benefits of Retaining City Golf Course .......................................................................... 47
Other Benefits of Municipal Golf.................................................................................................. 48
Appendix B - Rounds Played Report Year-End 2015 .........................................................49

Appendix C City of Battle Creek Debt Schedule..............................................................51
Appendix D Competitive Fee table ..................................................................................52
Appendix E Golf Course Life Cycle Chart........................................................................53
Appendix F Golf Demand Model Tables..........................................................................54
Summary Demographics ............................................................................................................. 54
Golf Demand Indicators............................................................................................................... 54
Golf Supply .................................................................................................................................. 55
Supply-Demand Ratios................................................................................................................ 55
Indices ......................................................................................................................................... 56
Introduction
PURPOSE
NGF Consulting was retained by the City of Battle Creek (City) to assist in evaluating the
current condition and future market potential of the City-owned Binder Park Golf Course
(BPGC). The City is considering options for the future of this facility and seeking to better
understand the realistic economic potential of the golf course given market and site realities.
The results of this market and facility analysis will be used to help determine the appropriate
course of action.
This review includes a strategic look at the Citys municipal golf offering, with a specific focus on
the recent performance of BPGC in light of concerns related to future profitability and ability to
cover scheduled bond debt payments. A key focus area for the NGF in this review is to help the
City establish the use of best industry practices in operating and marketing its golf facility, and
explore options to position the golf course to capture new sources of business. Other issues
addressed by NGF include the physical condition of BPGC, the market environment in which the
facility operates, and the operational structure in place, concluding with NGF recommendations
for maximizing the economic potential of BPGC going forward.
BACKGROUND
The subject (BPGC) is a 27-hole municipal golf course with driving range, small clubhouse and
maintenance facility located at 7255 B, Drive South in Battle Creek. The facility has three
regulation length 9-hole layouts that can be mixed/matched for an 18-hole round or nine holes
of play, plus three practice holes and driving range. Since being developed by the City
beginning in 1963, BPGC has been operated directly by the City and its golf staff. Non-golf
activities are provided by the facility and in 2016 BPGC plans to offer cross country skiing and
outdoor meetings. Concerts/festivals are also being considered at the property since it has
ample parking and well-maintained open-space areas.
NGFs review of Binder Park Golf Course makes it clear that the golf course is an important
element of the Citys overall Parks & Recreation system. In addition to serving community
golfers, BPGC provides a higher public purpose through special programming. For example,
The First Tee organization funded the development of a learning center building that was
donated to the City and is leased by the First Tee to promote learning and life skills through golf.
The regional program serves approximately 4,800 students.
The golf course generates approximately $1 million in total on-site revenue from golf operations
in recent years, sufficient to cover on-site expenses and contribute a portion towards its annual
debt service, which resulted from the 1999-2000 $3.5 million renovation that included 9 new
holes, a new clubhouse, three practice holes and a driving range. BPGC is self-sustaining
despite a significant downturn in rounds played and revenues over the last five years. This basic
financial condition is common in municipal golf across the U.S., as NGF surveys indicate that
only about 33% of public agency golf courses are currently covering all expenses (including
debt and overhead) and capital obligations, while one in three are unable to cover operating
expenses.
BPGC has declined in performance for a number of reasons, some of which are not controllable
by the City or golf course management. Factors such as weather, lingering effects from the
most recent recession, the declining interest in golf among some segments, and the general
oversupply of affordable public golf in this market have all contributed to the recent decline. The
review and recommendations contained in this report are designed to help the City understand
the actions it can take to help maximize the performance of BPGC, but also that the economics
of all golf courses will continue be subject to the uncontrollable factors noted above.
NGF REVIEW 2016

The review includes an evaluation of the system as it is presently operated, and includes
several best practices that can be implemented or enhanced to help improve overall economic
performance. Another key element of the study was to assess potential capital investments that
could result in increased net revenues for the facility. Finally, NGF was charged with reviewing
potential alternative operating structures for BPGC, and determining whether one or more might
result in better performance than the current City self-operation structure.
The findings and recommendations presented by NGF in this report are based on NGF
Consulting experience, knowledge of golf industry best practices, and a review of the BPGC golf
course and support facilities. NGF completed tours and meetings with City staff and golf course
management in January of 2016. Under consideration for this report are the present physical
condition of BPGC, golf course operations, and the status of the greater Battle Creek area
public golf market.
The key components and issues of this report include:
Overall condition and operating efficiencies of Binder Park Golf Course.
A review of golf industry standards and norms of operation.
Status of the broader Battle Creek market area, with focus on external issues that
can affect public golf operations (e.g., balance between demand and supply).
A review of BPGCs present physical condition and capital needs.
Providing operational best practice recommendations to help expand the customer

base at BPGC.
Provide strategic guidance on issues such as operating structure and potential

capital investments to ensure golfs continued viability in the City.
This NGF review was managed by Richard Singer, MBA, NGFs Senior Director of Consulting
Services, and Ed Getherall, MBA, Director of Consulting, with field work and other analysis
provided by Jerry Hinckley, Senior Associate Consultant. In addition to meetings with City of
Battle Creek officials and golf course personnel, the NGF consultants collected materials to aid
in understanding the local market area, including economic, demographic, climatological, and
operating data (to extent available) from other regional municipal golf operations. NGF also
collects considerable information and data on the golf industry on an ongoing basis as a regular
part of our organizations work, and relevant parts of this information and data are presented
throughout this report.
Binder Golf Course Overview

The subject (BPGC) is a 27-hole municipal golf course with driving range, small clubhouse and
maintenance facility located at 7255 B, Drive South in Battle Creek. The facility has three
regulation length 9-hole layouts that can be mixed/matched for an 18-hole round or nine holes
of play, plus three practice holes and driving range. Since being developed by the City
beginning in 1963, BPGC has been operated directly by the City of Battle Creek and its golf
staff. Non-golf activities are provided by the facility and in 2016 BPGC plans to offer cross
country skiing and outdoor meetings. Concerts/festivals are also being considered at the
property since it has ample parking and well-maintained open-space areas. The property is also
home to the regional First Tee facility that serves approximately 4,800 students with life skills
coaching, as well as access to golf instruction.
LOCATION AND ACCESS

BPGC is located in the central-western part of Calhoun County in the southern section of the
City of Battle Creek. Access to the facility is via the main entry road into the golf facility from B
Drive South, which connects with nearby Highway 66 and Interstate-94 (I-94).
Positive Aspects
The course is located near I-94, which runs east-west and connects Battle Creek
with nearby Kalamazoo (25 miles) to the west, and Ann Arbor (81miles) and Detroit
(125 miles) to the east.
BPGC is located approximately 3 miles from the 247 room Firekeepers Resort
Casino and the casino-owned 90 room Quality Inn (both located off I-94 at exit 104).
Firekeepers is a major regional tourist destination and offers 2,900 slot machines, 70
table games, poker, and high limit gaming rooms. The resort does not have a golf
course and participates, along with BPGC and others, in the Michigan Southern
Swing golf/hotel marketing program, which brings golfers to the region.
The region has a good road network with modest traffic issues that provides a wider
reach for BPGC to attract players beyond Battle Creek City borders.
BPGC appears to be in the region in the City/County where new commercial growth
is occurring. The primary residential areas in the City are located generally located
north of BPGC but population centers can easily access the site by Route 66, I-94, or
other major roadways.
Negative Aspects
The immediate area near BPGC is somewhat rural with farms and smaller
subdivisions dotting the landscape south of I-94.
Although BPGC is located reasonably close to major area roadways, the property
entrance off B Drive South does not provide visibility for local and commercial traffic
to any great extent. That said, Binder Park Zoo and Golf Course have been in
existence for over 40 years and the local public have been made aware of these
community assets.
HISTORY
Located along the southern border of the 433-acre Binder Park Zoo, BPGCs original 18-hole
golf course was built in 1963 at the height of the Arnold Palmer inspired golf boom on property
donated by local businessman Charles Binder to the City of Battle Creek to be used for
recreation and open space. The original BPGC layout enjoyed a good reputation for quality and
demand for golf was strong in the 1960s 1990s. In 1999, the City purchased an additional
150+/- acres and constructed an additional 9 holes, a new clubhouse, three practice holes and
a driving range. The original clubhouse structure and maintenance facility are still located at the
southeastern corner of the property.
The First Tee organization funded the development of a learning center building which was
donated to the City and is leased by the First Tee to promote learning and life skills through golf.
The development of the new 9 holes (designed by local golf architect Jerry Mathews) and new
clubhouse and practice facilities helped to modernize the overall design of the property and
improve the courses regional reputation. The budget for the improvements made in 1999-2000
was reportedly $3.5 million +/. The purpose of the golf expansion was to modernize the facility
to better compete against newer properties that were developed in the region in the 1990s and
to provide better golf services to residents of Battle Creek and regional visitors. In addition to
golf, BPGC offers services to non-golfers including cross country skiing, foot golf, and outdoor
meetings and events.
Golf play at BPGC and in the market remained strong in the early 2000s but the impact of the
recession in 2007-2009 was severe to regional golf courses and many courses have not
recovered lost play and are reportedly struggling to attract customers. BPGC has also
experienced the negative impact of the over-supply of courses and declining rounds in the
market but the facility has achieved good customer ratings and is known for offering a good
course at a good value.
Map View of Binder Park Golf Course
Google Earth image showing the BPGC and immediate surrounding elements. The course shows great natural
features and has limited development in immediately proximity. The view shows potential for the site to be altered
to allow for an expanded (or even new) clubhouse facility.
CURRENT OPERATION
Facilities
BPGC offers three championship length 9-hole regulation courses: Preserve 9 3,276 yards,
Marsh 9 3,346 yards, Natural 9 3,257 yards. By having 27 holes, the facility can offer golf
events and daily fee customers a flexible opportunity to golf on a variety of terrains with mature
trees, wetlands, and rolling topography. The 27-hole layout also offers the flexibility of hosting
tournaments and daily fee play concurrently. The facility is open year-round (weather permitting)
and in December 2015, golf play occurred through the Christmas holiday. In peak season, golf
operations commence each day at 6:30 and close after dark unless an event is utilizing the
clubhouse or 100+/- person banquet pavilion.
Binder Park GC Summer Landscape
Winter Golf Course Landscape
BPGC offers a large practice range that features a double sided grass teeing area as well as
mats for inclement weather. The range has room for approximately 30 golfers on the grass tee
or mats at one time. The practice range has target poles but does not offer specific target
greens. There is a full-service golf shop that is well stocked with top-of-the-line merchandise as
well as discounted items. The golf shop serves as the business operations center of the golf
facility and is the location where golfers call or walk-in to make reservations and/or pay green
and cart fees. The General Manager / PGA professionals office is located in the golf shop area
and contains most of the operations business files and other information.
The clubhouse building includes a bar and grill area, which serves sandwiches, pizza, hotdogs,
soups, chips, water, soda, and beer/wine, etc. The kitchen area in the clubhouse is small and
does not provide for oven or grilling operations. The lack of cooking facilities limits the offerings
for food service at the course but management has worked to provide a variety of snack style
foods to give golfers/events the ability to have a reasonable menu to choose from. Next to the
snack bar is a meeting/banquet pavilion room that can seat approximately 100+ guests.
Google Earth image showing the BPGC clubhouse, range and First Tee center.
Clubhouse Views from the restaurant
Pavilion View
For the last couple of years BPGC has offered golfers the use (for a fee) of a simulator for
winter activity. The simulator is located in the indoor seating area for the snack bar/restaurant
and is removed for the main golfing season.
NGF reviewed various travel/golf websites that provide ratings and reviews for BPGC. These
include Google, Trip Advisor, Facebook, and GolfNow. Customer ratings over a broad spectrum
of websites can provide a sense of customer satisfaction and operational effectiveness. In
reviewing these ratings and summaries, the BPGC operation scores very well in terms of value,
customer service and overall satisfaction. In fact, with GolfNow, the leading tee time reservation
system, BPGC and an upscale competitor, the Medalist GC, are the highest rated properties in
the Battle Creek market area. Another important fact in the reviews is to see how many times
customers provided feedback. In the case of BPGC, each of the major course rating websites
provided several consistent ratings to give a clear indication of customer satisfaction.
Operating Structure and Staffing

BPGC is owned and operated by the City of Battle Creek and is under the supervision of the
Citys Parks and Recreation Department. NGFs review of the operating structure reveals that
the golf facility has made significant efforts over the years to become more efficient and lower
costs where possible. NGF was provided and overview of staff levels and how seasonal
operations are handled at BPGC. Overall, BPGC employs three full-time year round employees
(GM, Superintendent, Mechanic). In season, the number of full-time equivalents increases to
approximately 5 clubhouse personnel and 9 maintenance personnel. Seasonal maintenance
labor hiring and firing is contracted through a local vendor. Costs are a 100% pass through to
the City, with a slight administrative charge added. The City retains complete operating control
over all staff.
Based on NGFs review of similar operations, and the fact that the facility has 27 holes, three
practice holes and a large practice center, course management has been operating the property
very efficiently and little if any additional staff reduction is possible while maintaining a good
customer experience and keeping the facility in good operating condition. Management has
utilized volunteers to assist with the golf course ranger program, and if inclement weather
occurs when staff is present, managers dismiss personnel to save hours and costs for days
when business is more active.
GOLF FEES
BPGC offers a number of pricing options for golfers including daily fee public rates as well as
memberships which essentially function as annual passes. NGF has summarized several key
rates below for 2015 and 2016.
2015
2016
18-Hole Weekday
$23.00
$23.50
18-Hole Weekend
$25.00
$25.50
18-Hole Cart Fee
$14.00
$14.50
Single Membership / Annual Pass
$550
$565
Family Membership / Annual Pass
$895
$920
The rate summary presented highlights that modest price increases are being targeted for 2016.
This is significant since past years have seen little or no fee increases as the poor economy and
high level of competition in the market have worked to keep prices low. NGF has seen a similar
pricing dynamic in many markets. BPGC staff indicated that factors such as the improving
overall economy in the market, BPGCs strong reputation for quality, and the closing of the
Yarrow Resort facility, provides support for these modest increases. In 2015, management
reports that 220 golf and 24 range memberships were sold. This number has remained fairly
stable in recent years. With the improving economy and the recent modest reduction in supply
from Yarrows sale, NGF anticipates that BPGC will pick up some additional golf memberships
in 2016. While the improvement in memberships is expected, the number will remain lower than
the 350+/- membership levels that existed in 2007.
Capital Projects/Equipment Review

NGF interviewed key staff about capital improvement projects and equipment needs at BPGC.
Overall the current condition of existing buildings, the golf course and equipment are in good
working order. The one signification exception is that a large golf course fairway mower (new or
used) will be needed within the next few years. Prices for this type of machine can range from
$30,000 used to $60,000+ new. Golf carts at the property are approximately 8 years old but are
in good working order. Given the age, a new fleet (owned or leased) will likely be budgeted after
the next 2-3 years. Within the historical operating expenses provided to NGF, BPGC expensed
$40,021 each year for cart costs and this amount could be allocated to a new fleet when
necessary. Currently the facility owns 92 electric Club Car vehicles.
Marketing
BPGC utilizes many common industry best practices to help drive business to the golf course.
These include: periodic e-blasts to the courses 5,000+/- customer database, use of Golfnow
tee time reservation/marketing system, and placing advertisements in City and Chamber
publications, as well as regional golf guides. In addition, to these activities, course management
is active in:
Promoting BPGC through the Southern Swing golf package cooperative that markets
10+ courses to regional golfers and tourists for stay and play packages with
participating hotels. In 2015, this effort generated nearly 200 rounds of additional
golf. NGF interviewed managers at the Quality Inn hotel, which is owned by the
Firekeepers Casino. Hotel owners indicated that they had an excellent relationship
with BPGC and customers have reported positive experiences, BPGC will continue
to be one of the top courses they recommend.
Marketing to area businesses directly for golf outings. With the existing outdoor
pavilion, the facility can provide a causal meeting/dinning event associated with golf
play. With 27 holes, BPGC is known to have the capabilities to host larger events.
Only Gull Lake Resort can host larger golf events than BPGC in this market.
Coordinating with the First Tee facility to provide additional exposure to BPGC,
bringing lessons and junior golfers in the region to the facility.
Promoting BPGCs well-developed league program (currently 26 leagues) that
provides loyal and repeat business for the golf facility. The three nine-hole layouts
are popular with leagues and the outdoor pavilion and updated craft beer, snacks,
and pizza offerings are popular with players.
Activity and Financial Performance

The City provided NGF with financial data on the golf operation dating back to 2010. Overall,
BPGC has seen a reduction in rounds played and a slow but steady decline in revenue that has
negatively impacted profitability. Management has worked to maintain overall operating
expense levels, including cost of goods sold, at roughly $950,000 or less for the last five years.
NGFs considers this operation to be very efficient, especially given that 27 holes of golf are
offered along with a practice center with 3 practice holes. While BPGC has been affected by
overall weakness in the market, the facility has shown resilience by continuing to cover its
operating costs, while providing good service levels. Based on NGFs review of municipal golf
operations across the U.S. today, only about a third of facilities are self-sustaining operationally.
Rounds Activity
Recent operational data shows a significant decline in rounds activity at BPGC from 2010
(21.4% from 2010-2014, with a modest uptick in 2015), with the biggest drop-off occurring
between 2010 and 2011. With improved late season weather, rounds for 2015 are projected to
be similar to 2013 levels, and moderately lower to what was achieved in 2011 and 2012. The
facility does appear to have achieved some weather-adjusted stabilization in total rounds played
over the last 3 to 4 years, which is tracking with the national trend. Refer to 2015 National
Rounds Played Report in Appendix B.
Binder Park Golf Course

Total Rounds Played 2010-2015
2010
BPGC
46,325
Annual % Change
2011
2012
2013
2014
2015
40,020
40,935
38,320
36,430
38,000
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
-13.6%
2.3%
-6.4%
-4.9%
+4.3%
Source: City of Battle Creek.
Revenue & Revenue per Round

Total gross operating revenue (excludes annual transfer in from General Fund of about
$67,000) at BPGC fell from $1.1 million in 2010 to $975,000 in 2014, a decrease of 11%.
Revenue rebounded by more than 6% in 2015 after some rounds recovery. From 2010-2014,
golf revenues green fee + cart fee + membership fees - declined by 18%. The falling revenue
at BPGC has been entirely a function of declining rounds, as average total revenue per round
increased by $3.01, or nearly 13%, between 2010 and 2014. Every revenue category increased
during that time period, though cart revenue per round is virtually the same as it was in 2010.
Merchandise revenue per round (increase of 22.5%) and food & beverage revenue (31.4%)
have improved significantly since 2010.
BPGCs average overall golf fee (includes green, cart, and membership revenue) of about $16
per round is an indication that members are very active (113 rounds per membership in 2014)
and that there are a relatively high proportion of rounds being sold in various discount
categories (e.g., juniors, seniors, off-peak, leagues, First Tee) or for less than 18-hole rounds
(9-hole, 3-hole). Regardless of these factors, BPGC has a very low effective green fee for area
golfers.
Binder Park GC
Average Revenue per Round - 2010-2015
2010
2011
2012
2013
2014
2015
$23.75
$25.09
$25.65
$26.09
$26.76
$26.66
Green + Member Revenue/Rd
$9.15
$9.72
$9.45
$9.65
$9.71
$9.29
Cart Rev. / Round
$5.79
$5.49
$5.80
$5.56
$5.80
$5.78
Practice Range Rev. / Round
$0.52
$0.42
$0.50
$0.54
$0.56
$0.60
Merchandise Rev/Rd
$4.22
$4.78
$4.90
$5.19
$5.17
$5.68
Food & Bev Rev/Rd
$3.31
$3.74
$4.01
$4.21
$4.43
$4.35
Average Rev/Round*
Source: City and NGF. * Excludes annual transfer in from General Fund
Facility Revenue & Expense Overview

NGFs analysis shows that BPGC has been able to generate a positive net operating income
over the entire six-year period between 2010 and 2015. However, net income has fallen
dramatically over this time period in the face of declining rounds activity, from nearly $170,000
in 2010 to about $78,500 in 2015. This result is before the annual transfer in of ~$67,000.
NGFCs experience over the last decade has shown that an increasing percentage of lower to
middle tier green fee municipal facilities have not been able to cover even their day-to-day onsite expense, so BPGC is ahead of the game in this regard. However, the data and trends
presented below reflect that the golf operation is highly unlikely to ever be capable of meeting its
annual bond payments.

Summary of Financial Performance 2010-2015
Rounds
2010
2011
2012
2013
2014
2015
46,325
40,020
40,935
38,320
36,430
38,000
$126,493
$113,480
$96,852
$87,752
$79,680
70,061
Revenue
Membership Fees
Greens Fees
297,468
275,509
290,154
281,854
273,910
282,983
Golf Cart Fees
268,034
219,720
237,294
213,166
211,247
219,561
Practice Range
23,876
16,855
20,547
20,698
20,277
22,681
Misc. Golf Income
35,602
37,712
40,306
36,159
40,107
59,554
Merchandise Sales
195,602
191,351
200,768
198,881
188,196
215,904
Food & Beverage Sales
153,112
149,624
164,266
161,402
161,526
165,161
$1,100,187
$1,004,251
$1,050,187
$999,912
$974,943
$1,035,905
$154,290
$170,338
$162,033
$163,600
$167,982
$186,998
$77,094
$76,622
$80,915
$79,644
$82,298
$73,813
$231,384
$246,960
$242,948
$243,244
$250,280
$260,811
$213,185
$193,749
$216,231
$184,817
$217,100
$274,023
40,021
40,021
40,021
40,021
40,021
42,244
Total
Cost Of Sales
Merchandise
Food & Beverage
Total Cost of Sales
Expenses*
Salaries & Wages/benefits
Cart Expense
Food & Beverage
1,778
1,548
1,843
1,400
2,003
2,278
330,443
332,317
320,725
311,684
274,323
249,485
Utilities
41,218
43,239
48,005
41,180
42,852
41,532
General Operating
61,865
70,011
74,446
68,170
76,340
76,241
Maintenance
Insurance
10,820
10,820
10,820
10,820
10,626
10,820
Total Departmental
$699,330
$691,705
$712,091
$658,092
$663,265
$696,623
Total Expense (Incl. COS)
$930,714
$938,665
$955,039
$901,336
$913,545
$957,434
Net Operating Income
$169,473
$65,586
$95,148
$98,576
$61,398
$78,471
Transfer In
$66,708
$66,842
$66,833
$75,015
$67,935
$66,667
*Net Income
$236,181
$132,428
$161,981
$173,591
$129,333
$145,138
Source: City of Battle Creek. * Expenses do not include depreciation.
Bond Debt Schedule

A key goal of this analysis is to determine the viability of new investments and/or operational
changes that will enable the property to support future debt payments. The debt schedule
shown in Appendix C highlights the future payment amounts and timing.
The Bond payment schedule appears to be back-end loaded, whereby payments of principal
are targeted in the later years of the bond schedule. This structure was reportedly entered into
to allow the golf operation the time necessary to increase profitability to be able cover the
payments. As we saw above, the operation has been able to cover operating costs to deliver
quality golf service to the community. However, in recent years the property has not been able
to generate sufficient revenue to fund a debt service reserve or cover bond payments. Later, in
the Economic Projections section of the report, we will show whether NGF believes that BPGC,
under improved operations, is capable of covering all bond payment costs with golf course net
income.
BINDER PARK GOLF COURSE - NGF SUMMARY 2016

The City is operating a quality mid-tier public golf course that has been able to meet its annual
on-site expenses despite a significant downturn in play over the last 5 to 6 years. BPGC staff
has been efficient in maintaining a strong product despite a very lean budget, and the facility is
well perceived in the market as a strong value. As we will explore in the following sections of
this report, NGF believes there is room for operational improvements that may result in some
incremental revenues, as well as some potential opportunities to introduce new revenue
sources. However, with a very competitive market environment at least for the short term
these improvements and new opportunities are unlikely to allow the golf operations to fund all of
the existing debt service.
External Market Analysis Summary

The City should understand that the external golf market will present challenges for strong
economic performance at BPGC, as the trends in the golf industry are generally not favorable
for golf course operators. The total number of golfers has declined, and total spending on golf
has declined along with them. Below we provide an overview of national trends with respect to
golf, key local golf market demand and supply indicators, and a summary of local demographic
factors that have the potential to affect golf demand for Binder Park CC.
NATIONAL TRENDS
Golf continued its macro trend toward stabilization in the 2014-2015 period, in contrast to
sensational negative perceptions of the game as portrayed by mainstream media. Sociodemographic, financial and cultural headwinds certainly persist for golf, and it remains highly
competitive for golf-related businesses. Considering the severity of the recession and its
lingering effects on discretionary income and time, golf has held up rather well. (Historically,
participation has closely tracked Real Adjusted Household Income, suggesting that if income
increases, theres a likelihood that the golfer trajectory would increase with it).
Multiple NGF studies of golfers since 2008 would attribute the gradual decline in golfers and
rounds primarily to the impact of lower job security and concern over personal finances, not
waning appeal for the game. Golfs pay-for-play green fee revenues and other spending on the
sport will always be vulnerable to outside forces including weather and the economy, but the
game remains popular and fortunate to have a deep well of interested prospects. Positive
economic indicators, stabilization in participation and rounds played, an increase in weatheradjusted utilization, and the return of private equity funding to the industry are just a few of the
under-reported developments in golf that tell the current story of the industry. Other findings:
Participation - The national golfer number (participation) appears to be continuing a

stabilization trend (with some net leakage among mainly occasional/less committed
golfers), with 2015 projected to be the fifth consecutive year at approximately 24+
million golfers that played at least one round of golf in the past 12 months.
Golf Course Supply - The correction in golf course supply continued in 2015 at a
level comparable with the previous three years. According to NGF data, since the
market correction in golf course supply began in 2006, there has been a cumulative
net reduction of 679.5 golf courses (18HEQ), which represents a drop of about 5%
off the peak supply year of 2005. For perspective, golf supply grew by 40% in the
previous 20 years (1985-2005). This much-needed move toward supply/demand
equilibrium is expected to continue for the next several years.
Looking Ahead Provided rounds played and participation remain stable, and there
is no reason to forecast otherwise, golf is likely a good weather year away from
seeing growth in 2016. According to Golf Datatech, rounds played for 2015 were up
1.8% nationally, and 7.2% for the East-North-Central region, which includes
Michigan. Michigan was a strong performer, up 10.9% for the year. The next couple
of years should provide a stronger indication of whether playable day- adjusted
rounds have stabilized.
LOCAL MARKET
Battle Creek Area Demographics
In the table below, NGF Consulting summarizes the population, median age, and median
household income trends for BPGCs 5-, 10- and 15-mile markets and Calhoun County, for
comparison to national benchmarks. NGF has made the following observations regarding the
demographics of Battle Creek and surrounding areas
Summary Demographics
OHGC Site
Population 1990 Census
CAGR 1990-2000
CAGR 2000-2010
Population Estimate 2015
Population 2020 Projected
CAGR 2010-2019
Median HH Income (2015 Estimate)
Median Age (2015 Estimate)
Caucasian
Asian
5 miles
22,932
25,131
0.92%
26,806
0.65%
26,586
26,675
-0.06%
$60,067
43.5
88.1%
4.3%
10 miles
93,198
94,740
0.16%
94,316
-0.04%
95,997
97,123
0.37%
$41,946
39.3
78.9%
2.5%
15 miles
133,085
137,383
0.32%
136,502
-0.06%
137,794
139,028
0.23%
$45,746
40.6
83.5%
2.0%
Calhoun
County
135,981
137,986
0.15%
136,146
-0.13%
137,962
139,354
0.29%
$42,777
39.9
81.4%
2.0%
U.S.
248,584,652
281,399,034
1.25%
308,745,538
0.93%
319,998,423
332,811,226
0.94%
$52,747
37.8
71.0%
5.4%
CAGR = Compound Annual Growth Rate. Source: NGF Consulting, Tactician Corporation, Applied Geographic Solutions
Population growth rates in the subject markets and Calhoun County were slightly
negative between 2000 and 2010, though there was modest growth within 5 miles of
the facility. Growth over the next five years is projected to be only about one-fourth to
one-third that of the national rate of growth, so increase in rounds activity is not likely
to come simply from organic growth.
The Median Household Income of Binder Park GCs immediate 5-mile trade area is
about 14% higher than the national figure of $52,747. However, the larger local trade
areas, and Calhoun County as a whole, exhibit incomes that range from 13% to 20%
lower than the national median. In general, higher income residents are more likely
to participate in golf, and they play more frequently than lower income golfers.
The Median Ages in the local trade area are considerably higher than the national
median of 37.8 years. This is especially true in the 5-mile market, which shows a
median age of 43.5 years. In general, golf participation rates and frequency of play
increase with age (though both decline among the elderly), making relatively older
markets more attractive to golf facility operators, all other factors being equal.
Economic Factors
It is clear that the recession of 2007-2009 had some direct and lingering effects on the demand
for golf both nationally and locally, as decreased discretionary income and other economic
factors resulted in reductions in recreational / leisure spending. Below is a brief summary of
other factors specific to the local Battle Creek area economy that have the potential to affect
demand for golf in 2016 and beyond.
According to Kalamazoo-based W.E. Upjohn Institute for Employment Research,

Michigans employment is expected to grow 1.4% in 2016 and 1.5% in 2017, a pace
slightly slower than the national average. The state's unemployment rate continues
to decline, on par with the national average of 5.0%. The unemployment rate in
Battle Creek, also around 5%, is down to its lowest level since 2002.
The Upjohn Institute reported that the area lost 3,850 jobs in the Great Recession of
2007-09, but since has gained 5,150 jobs in the recovery. Manufacturing, along with
health and education jobs, are significant drivers of the local Battle Creek economy.
With the exception of the food manufacturing industry, which suffered Kellogg Co.
job cuts, the area's core industries printing, fabricated metal manufacturing, and
transportation equipment manufacturing had a positive job change between 2004
and 2014.
Battle Creek's employment forecast is for 1.6% and 1.3% employment growth in
2016 and 2017, respectively.
Weather/Climate - Golf is an outdoor activity and thus weather will impact activity
and revenue. NGF estimates that over 90% of golf rounds are played when the
temperature is between 55 and 90 degrees. Rain, snow, and wind are mitigating
factors that will reduce the number of playable days. Golf activity can be hosted
approximately 6 to 7 months in a normal weather year. Average July high
temperatures are 83 degrees and January highs typically reach 32 degrees. Rainfall
averages approximately 33 inches and snowfall 58.1 inches.
Climatological Data
Battle Creek, MI Area
Temperatures
Month
Precipitation
Inches
Average
High
Low
January
24
32
16
1.7
February
26
35
17
1.3
March
36
46
25
1.9
April
48
60
36
2.8
May
58
71
46
3.8
June
67
79
55
3.2
July
71
83
60
3.4
August
69
81
58
3.5
September
62
73
50
3.7
October
50
61
39
3.1
November
39
48
30
2.8
December
28
35
20
Source: Weatherbase, Battle Creek, MI
Golf Demand
The following are summary NGF observations regarding key golf demand measures for the
local golf market, derived from the NGF Golf Demand Model. Supporting tables are found in
Appendix F.
The golf demand indices for the local markets around Binder Park GC indicate golf
participation and rounds demanded rates that are about 40% to 80% (5-mile market)
higher than the U.S. benchmarks. This high demand is reflective of the high regional
golf participation of the upper Midwest, as well as the relatively favorable age profile,
high Caucasian population (who exhibit highest golf participation rates) and, in the 5mile market, high median incomes.
There are an estimated 8,050 golfing households within ten miles of BPGC, with the
potential to demand as many as 211,000 annual rounds of golf. In Calhoun County,
there are about 11,100 golfing households (expected to grow by about 600 over the
next five years), demanding just fewer than 300,000 rounds of golf each year. Actual
rounds played at area golf courses exceed this demand significantly, indicating that
players and rounds from outside the market area are being imported due to the
strong supply of golf courses.
Latent Demand This measure represents non-golfers who express an interest in
playing golf but are currently not active, including former golfers (gave it up), and
those who never tried. The demographic profile of these interested non-golfers tends
to be more female and younger than the population as a whole. NGF estimates
9,700+ latent golfers residing within 10-miles of BPGC.
Golf Supply
The following are summary NGF observations regarding key golf supply measures for the local
golf market. All measures are derived from the NGF U.S. Golf Facilities Database and the NGF
Golf Demand Model. Supporting tables are found in Appendix F.
There are 18 total golf facilities (subject included), totaling 351 holes, within fifteen
miles of Binder Park Golf Course, including 16 that are public (315 holes). Eleven of
the 16 public access facilities are at NGF-defined Value price points, with peak
season riding rates of less than $40.
Unlike most markets weve observed nationally, there has been no net reduction in
golf holes in Battle Creek/Calhoun County over the last decade, though the closure
of Yarrow will change that. (The U.S. has seen the net closure of about 4.6% of
supply over the previous decade).
Golfing Household/Supply ratios are derived by dividing the number of golfing
households by the number of 18-hole equivalent golf courses in a given market. This
measure is used as a benchmark to establish the level of support that is available for
each 18 holes of golf in the market. A Golfing Household/Supply index is derived
from these ratios (base national figure = 100). The 15-mile market around the Binder
Park GC has 61% fewer golfing households per 18 holes of public golf than
does the nation overall, and 72% fewer golfing households per 18 holes of
Value price point public golf, where BPGC is positioned.
Golfers per 18 Holes

Golfers per 18 Holes - NGF has also evaluated the relative strength of the market with a
comparison to a national threshold of golfers per golf course within 10 miles of a golf course.
In its 2009 publication The Future of Public Golf in America, NGF hypothesized that the best
predictor of a public golf courses success was the number of golfers per 18 holes within a 10mile radius, with 4,000 identified as the key number for projected financial stability. As shown in
the table below, the BPGC is in a market with far fewer golfers per golf course than the
identified threshold. NGF estimates that Calhoun County has less than 25% of the threshold
number of golfers.
Market
BPGC
Total U.S. Threshold for Successful Public Golf
Aggregate Calhoun County
Est. No. of
Golfers
11,192
Total 18-H
Equivalent
9.0
Golfers per 18
holes
1,244
4,000
15,705
16.0
982
Source: National Golf Foundation
Golf Course Market Supply / Demand Summary

The review of data for the Battle Creek / Calhoun County area shows relatively strong golf
participation and demand from resident households, which is greatly mitigated by an oversupply
of affordable, public golf supply. With a stabilized population bases, no new golf courses on the
horizon, and potential further closures of existing courses, the local may become more favorable
for existing operators in the coming years.
Key Market Competition

For this analysis NGF visited several competitive properties and spoke to available operators to
obtain information on the market, competitive trends, expectations for the 2016 golf season, and
indications of strengths and weaknesses of the BPGC operation. Given the timing of NGFs visit
to the market in January, all of the golf courses in the region were closed for play and few had
management staff available to interview. For this market analysis, NGF has focused on a few
key competitors as well as demand data from NGFs regional golf research.
BPGC management provided NGF with a competitive market overview that outlined key
information for facilities. The tables below lists courses visited and key observations for each
facility. (A summary fee table for these key competitors is located in Appendix D). Following the
summary profiles are NGF summary findings for this competitive market.
Riverside Country Club
Bedford Valley Golf Club
The Medalist
Stonehedge North and South Courses
Located near downtown Battle Creek, property

was a private club until 3+/- years ago. Property
sold for to a private investment group for
$550,000 +/-.
The owner of Cedar Creek GC is reportedly a

partner/manager in this facility.
The facility reportedly has seen declines in

rounds and rates.
Course received positive reviews from

Tripadvisor.
Riverside focuses on outings/banquets.
Some golf operators interviewed indicated that

site has potential for commercial/residential
development in the future.
Peak Green/cart fees of $42.00.
Part of the Gull Lake View Resort facilities, the

property is an individual 18-hole course located
northwest of Battle Creek.
One of the better courses with green fees of

$62.00.
Course generates approximately 50% of play

from tourist golfers from the resorts condo
rentals.
Attractive/functional clubhouse provides outing

and banquet service.
All Gull Lake View Resort properties currently

use Golfnow and discounts are available
throughout the year and in off-peak times.
High-quality public golf facility that offers a peak

summer rate of $62.00.
Medalist has a large full service clubhouse with

an outdoor deck with bar service and a tented
wedding pavilion that is set up seasonally.
Medalist is located in Marshall to the east of

Battle Creek.
Part of the Gull Lake View Resort facilities,

located a couple of miles from Gull Lake View
courses.
36-hole facility with modest clubhouse on rolling

terrain. Standard green/cart fees are $62.00 in
peak season.
The property relies heavily on golf traffic from

condo rental guests.
Property offers limited clubhouse services as

compared to other the affiliated resort properties.
Gull View Lake East and West Course
Stoatin Brae Golf Club
Part of the Gull Lake View Resort facilities, this is

the original Scott family property developed in the
1960s and is located near Gull Lake, the facility
is the primary location for lodging for all resort
guests (66 condo units housing 264 guests).
Management reports that occupancy rates for

2016 are higher than in 2015.
The resort markets to Ohio, Indiana, Illinois,

Michigan golfers (less reliant to local market).
Golf fees are $62.00 like other resort golf

properties. In off peak times, properties offer
discounts to local golfers.
Single weekday memberships are $1,046 and

$1,640 for seven day memberships at all resort
courses.
Under construction owned by Gull Lake View

Resorts, this property is located north of Battle
Creek and will target tourist golfers that typically
go to upscale northern Michigan resorts.
Management indicated that pricing will be $90$125 and layout will be a links-style property (no
trees).
Clubhouse is under construction and appears

that it will not include a large banquet room but
will have a restaurant area and golf shop.
Additional upscale condos that are under

consideration for development at the resort will
help to support demand for this new property.
Yarrow Golf & Conference Resort

(Closed for Golf)
Cedar Creek Golf Course
Oakland Hills Golf Course
Alywn Downs Golf Course
Sold in 2015.
Golf course closed and resort operations being

renovated to serve as a rehabilitation center.
Prior to closing the property reportedly played

28,000 rounds with in-season rates $60.00+/-
Strong local and regional competitor.
Property had reportedly not been maintained

as well as in past for the last few years.
A mid-quality course west of BPGC in Battle

Creek.
The course is reportedly maintained in good

condition and has a generally flat and open
layout with mature trees.
The clubhouse is modest and the property

offers a simple outdoor grilling pavilion. Peak
fees are $35.00.
Listed for sale - $995,000.

http://www.bizbuysell.com/BusinessOpportunity/Oakland-Hills-Golf-Club/1160270/
Area operators indicated that in recent years

business was down and that the older-style
golf course was having a hard time competing
in the market.
It is unclear if the property will continue to be

operated as a golf course or other uses (farm
or commercial) in the future.
Recent peak rates are reportedly $29.00
The property has peak rates of $31.00 and is

located east of Battle Creek in Marshall.
The property offers a basic golf layout and

historically has been a good value for golf.
Recent years has reportedly seen some

deterioration in the course and the driving
range was reportedly closed and appears
overgrown.
Competitive Review Key Findings

NGF was able to interview managers at the Gull Lake View Resort, Battle Creek Country Club,
and the Medalist. While operators did not provide specific rounds and financial performance
data, the NGF was able to obtain information on views of the market, how recent business
trends have been, what were the expectations for 2016, and what challenges exist for golf in the
Battle Creek market. Based on these discussions and the overall competitive review, NGF notes
the following key competitive market findings:
Overall, Battle Creek is a highly competitive golf market and has been for the last
10+/- years. Not all of the courses in the market can sustain their operations and
some may close which will benefit the remaining courses.
Each regional operator interviewed, when asked for their view of BPGC, indicated
that the BPGC served public golfers well and that the facility has a good reputation
with local golfers, business, leagues, and hotels.
With the improving regional economy, especially in the auto industry, operators are
cautiously optimistic that demand/spending could be on the rise, which should
benefit golf and other recreational activities.
The closing of the Yarrow golf facility is providing a new opportunity for better quality
courses to capture golf and event business.
Posted rates are being moved up (modestly) in the market for 2016, compared to the
recent past where there were almost no observed increases and the high prevalence
of discounting.
Resort oriented golf facilities that have stay and play packages (hotel/rental units)
have been successful in attracting a loyal customer base.
Private clubs in Battle Creek are having challenges attracting new members since
public golf is so inexpensive and plentiful.
Gull Lake View Resort (5 courses) appears to be the most successful golf operation
in the region in terms of overall demand and consistency of play. Management
reports that much of the Resorts business comes from tourist golfers who rent villas,
though local players generally support leagues, as well as spring and fall golf play.
Stoatin Brae is a new golf course being developed as part of the five-course Gull
Lake View Resort. This facility, located near Augusta, will be the Resorts most
upscale golf property, charging up to $100 or more for peak green fees. The goal of
this course will be to retain some south-central Michigan golfers who want top-quality
golf courses found in northern Michigan, such as Treetops and Arcadia Bluffs.
Management indicated this property is not designed to compete against local
courses and will be used mostly by tourists/resort guests. A partial opening (9 holes)
is scheduled for July 2016 with a full opening in 2017.
EXTERNAL MARKET SUMMARY

As noted, the City should understand that the external golf market presents challenges for
strong economic performance of BPGC. Below is a summary of our findings on the external
market environment:
Golf continued its macro trend toward stabilization in the 2014-2015 period, and
rounds played were up in 2015. While socio-demographic, financial and cultural
headwinds persist for golf, the game as a participation sport has held up rather well
considering the severity of the recession and its lingering effects on discretionary
income and time.
The review of data for the Battle Creek / Calhoun County area shows relatively
strong golf participation and demand from resident households, which is greatly
mitigated by an oversupply of affordable, public golf supply. The 15-mile market
around the Binder Park GC has 61% fewer golfing households per 18 holes of
public golf than does the nation overall, and 72% fewer golfing households per
18 holes of Value price point public golf, where BPGC is positioned. With a
stabilized population bases, no new golf courses on the horizon, and potential further
closures of existing courses, the local may become more favorable for existing
operators in the coming years.
BPGC is not unique in having seen play levels drop since 2008. Slumping demand
has helped prompt a recent sale of Yarrow Golf Resort and Conference Center and
two other courses (Oakland Hills and Cedar Farms) are reportedly for sale for under
$1.0 million. The closing of Yarrow is expected to yield increased public golf and golf
events for BPGC in 2016.
The regional economy and employment data shows improvement over recent years
and should provide increased wages/demand for recreational activities, including
golf. However, the population base is stable, so the golf operation will have to rely on
increased market share and more effective activation of latent demand in the market
to grow rounds activity.
NGF noted demand for weddings and banquets at golf course venue in the Battle
Creek/Calhoun County market. The facilities observed that have the best ability to
host events have large clubhouses that offer full food and beverage service. BPGC
effectively competes for golf outings and non-wedding events that can be catered or
that request outdoor barbeque/grilled foods, since it has a covered outdoor pavilion.
Findings & Recommendations

Below we provide a summary of key findings and recommendations for Binder Park Golf
Course. This section is divided into the following components: (1) Key findings; (2) Closing or
selling BPGC; (3) Alternative operating structure considerations; (4) General recommendations
to improve operations and marketing; and (5) Analysis of potential revenue enhancing projects.
KEY FINDINGS - BINDER PARK GOLF COURSE

NGF offers the following summary findings from our review of Binder Park Golf Course:
Management has maintained overall operating expense levels, including cost of

goods sold, at between $900K and $950K for the last six years. NGFs considers this
operation to be very efficient, especially given that 27 holes of golf are offered along
with a practice center and 3 practice holes. While BPGC has been affected by overall
weakness in the market, the facility has shown resilience by continuing to cover its
operating costs and providing good service levels. (NGF national survey research
shows that only about a third of municipal golf facilities are covering both operations
and debt service). Future improvements in operating profit will most likely need to
come from increased revenues, not expense reductions that might damage the longterm viability of the golf facility.
Total gross operating revenue (excludes annual transfer in from General Fund of
about $67,000) at BPGC fell from $1.1 million in 2010 to $975,000 in 2014, a
decrease of 11%. Revenue rebounded by about 6% in 2015 after some rounds
recovery. The falling revenue at BPGC has been entirely a function of declining
rounds, as average total revenue per round increased by nearly 13% between 2010
and 2014. This positive operating income each year was available to be put towards
minor capital items and the annual debt service.
NGFs observation of BPGC indicates the facility and its buildings are in good
working order, and equipment is being maintained properly. Under the current
operation plan, capital expenditures should generally be limited to golf course
equipment (mowers & golf carts) over the next several years.
The market area in and around Battle Creek is highly competitive with 18 golf
facilities (16 public access) within 15 miles of BPGC. Area operators report that
BPGC is not unique in having seen play levels drop since 2008. Slumping demand
helped prompt a recent sale of Yarrow Golf Resort and Conference Center, and two
other courses (Oakland Hills and Cedar Farms) are reportedly for sale for under $1.0
million. Struggling courses with a short-term focus are offering steep discounts to
attract play, resulting in a challenging operating environment for facilities such as
BPGC.
The regional economy, including employment data, shows improvement over recent
years and should provide increased wages/demand for recreational activities,
including golf. Population growth in the City/County is expected to be minimal over
the next five years. Building permit data for 2014 in Battle Creek indicates that 10
construction permits were delivered for new residential projects, an indication that
new population growth will not result in significant incremental demand for golf.
Rather, the focus at BPGC should be on more effectively engaging local residents
and area visitors to play at one of the finer public golf facilities in the market.
BPGC is currently utilizing many industry best practices to successfully compete in

the market for golfers. That said, NGF has outlined some additional initiatives that
could help improve profitability of the facility in the near future.
In addition to operational and programing opportunities, the closing of Yarrow considered a competitive upscale facility in the Battle Creek market - is expected to
yield increased public golf and golf events for BPGC in 2016 and beyond, especially
since BPGC has a good market reputation for quality and service. If the closing is a
sign that alternative uses will increasingly be considered on properties where nongolf use is feasible, BPGC may benefit from additional future closings.
NGF research documents that demand for weddings and banquets at golf course
venues exists in the market. The facilities observed that have the best ability to host
events, such as the Medalist, Battle Creek Country Club, and Gull Lake View Resort,
all have large clubhouses that offer full food and beverage service. Operators who
target the wedding market indicate that they host 10 to 30 events each year. BPGC
effectively competes for golf outings and non-wedding events that can be catered or
that request outdoor barbeque/grilled foods, since it has a covered outdoor pavilion.
CLOSING OR SELLING BPGC

In addition to looking for ways to improve the economics of the golf course, the City has also
considered the implications of: (1) Selling the facility; (2) Closing the facility.
Selling BPGC: NGF has been told that only a portion of the property (154+/- acres) could be
sold if that option were to be pursued. Reportedly, the 1963 donation to the City for the land
containing the original 18 holes and former clubhouse building was to be used for recreational
activities by the City of Battle Creek. If BPGC were to be sold, NGF believes it would be highly
unlikely for the City to find a buyer that would be willing to pay off the debt, unless the property
could be rezoned for a more profitable use. (The recent listing of the nearby Oakland Hills
course of less than $1.0 million is an indication that an expected price would likely not repay the
bond debt). If the City were to seriously consider the sale option, a detailed real estate analysis
and appraisal for the highest and best use should be conducted.
Closing BPGC: NGF has noted that BPGC even after a downturn in rounds played has
been contributing a positive net income, and funding minor capital items, before debt service.
When the debt service is considered in the context of being a sunk or fixed cost, it is hard to
justify closing a facility that is meeting all of its operating obligations and contributing some
funds toward debt service, unless there were a more profitable (and permissible) use of the
land. Closing the course would remove the cost recovery (revenue) element, while incurring
both new one-time costs, such as those related to securing the site and demolishing unused
structures, and retaining other expenses (e.g., some level of maintenance for the land,
employee legacy costs). Another consideration is that a golf course also provides other indirect
economic benefits (e.g, wages earned and spent within Battle Creek, etc.), as well as noneconomic benefits, to a community (see Appendix A).
In light of this discussion, NGF recommends that the City keep BPGC open and
concentrate on making the golf course a more economically viable operation, even if as
we are projecting it continues to fall short of paying all of the debt service.
ALTERNATIVE OPERATING STRUCTURE CONSIDERATIONS

As part of the scope of the NGF analysis, we have evaluated alternative operating structures in
the context of improving financial performance of the facility and meeting the goals of the City of
Battle Creek. Our summary review of options includes:
1. Self-Operation (current form of management). Self-operation indicates the City is
the direct employer of facility workers, who manage the golf course through business
plans and goals set by the City. The biggest disadvantage of this type of structure
often is that employees are subject to City labor policies and benefits. There may
also be limitations on paying incentives to public employees. Given the limited
number of full time staff that is currently employed at BPGC, the wage and benefit
package that might be provided from a private management company is estimated to
have limited positive impact on financial results.
2. Concession Agreements or Personal Services Contract: A Personal Services
Contract is very similar to the management contract (Item #3 below), with the
exception that the vendor is an individual as opposed to a company. A concession
contract is similar and can function more like a lease agreement. In addition, while a
personal services contract is often narrower in scope (often covering only some of
golf operations), it can also be comprehensive and include both operations and
maintenance. Although a personal services contract could be just for the services of
the individual, the contract could also be structured to where the employees of the
operation become employees of the contractor.
3. Full-Service Management Contract. In this structure, a management company is
hired to operate all aspects of the BPGC. This structure can come in several forms
and include combinations of all areas of operation as noted with concessions. The
greatest advantage to the City is shifting the operation to a qualified third-party who
will control the operation and employ all staff directly. This can lead to reduction in
expense over self-operation, although current NGF benchmarking shows BPGC to
be operating at an overall low expense level at this time.
The greatest disadvantage of this option is in the operational risk remains with the
City. Although much control is given to an outside management organization, the
City is responsible for paying the management fee to the operator, provided all terms
of the agreement are being met, even if the golf course financial performance does
not improve. These contracts work best when they are incentive-based and do not
lock the golf course owner into long-term contracts. Ideally, the agreement will create
an alignment of interests so that if the management company is doing well, the City
is doing well and vice versa.
4. Lease. The golf course could be leased to a private golf company (or individual),
who would be responsible for all operating expenses as well as capital upkeep. The
lease can be structured to provide an annual lease payment to the City, and the
lease could be established to include certain lessee requirements, including capital
investment in facility improvements, maintenance standards and/or restrictions
regarding green fees. The advantage of this structure is the removal of the City from
the day-to-day operation and the full shifting of risk to the operator.
The key disadvantage is the loss of control in the operation and the growing difficulty
in finding a qualified vendor willing to accept the risk, especially when large-scale
capital investment is required in a difficult market.
5. Hybrid Contract. A hybrid contract combines some of the advantages of a lease
with those of a management contract. These are usually of shorter term (5 +/- years)
than a lease and should include a broader program of revenue sharing (also risk
sharing). Hybrid contracts typically do not include large-scale capital improvement on
the part of the vendor, but some management companies may be willing to include
some of the capital improvement recommendations contained in this report in
exchange for a longer-term contract and higher management fees. The advantages
and disadvantages to the hybrid contract are basically the same as the management
contract, except that the arrangement is generally more flexible and provides for a
greater sharing of revenues and assumption of risk by the operator.
Overall, NGFs analysis of BPGCs operating structure shows that current management is
successfully delivering good service (see ratings) and holding operating expenses low to enable
the facility to cover all operating costs and provide capital for projects and equipment. By adding
an annual management fee to the expense structure, it may be difficult to generate additional
revenue to cover these new costs to benefit the goal of increasing profit.
A lease to a private operator that would provide payment to the City of $250,000 - $300,000
would be a solution allowing BPGC cover all obligations, including bond payments. However,
based on the operating results of the last several years at BPGC, as well as the fact that some
golf courses in the market are for sale at modest prices, NGF believes it is very unlikely that
an operator could be found to lease the facility under terms acceptable to the City.
GENERAL RECOMMENDATIONS TO IMPROVE OPERATIONS AND MARKETING

NGF has noted several ideas designed to improve operating and marketing strategies. These
recommendations require limited investment and focus on best practices that NGF has
observed in the golf industry that can help improve service, increase revenue, and control costs:
BPGC should work with City, County, and Chamber officials to promote the facility as
a regional golf and sports center. A more collective effort can help to deploy
resources, cross-promote activities and services, and highlight that BPGC is a
highly-rated recreational amenity that has served golfers and non-golfers alike.
Working with key stakeholders, BPGC management can help to promote regional
activities such as cross-country runs, BBQ challenges, speed golf events, long drive
championships, live music festivals/concerts, and off-site team building meetings.
These types of activities would need to be scheduled at times that dont cause
disruption of general golf play.
NGF observed road signage to Binder Park Zoo and BPGC in the area immediately
surrounding the property. If signage at nearby exits on I-94 and along Highway 66
could be added this would help to inform golfers, tourists, and residents that a golf
facility is nearby and easy to find. NGF is not suggesting billboards be used to
market the course, but rather smaller informational signs that are often used for
attractions and other services.
NGF reviewed the golf course website and found that it is functional and provides
necessary information. The use of GolfNow as the hosting company works well with
the GolfNow reservation system currently in use. NGF recommends the website be
populated with attractive high-resolution photos showing clear and vibrant pictures of
golf holes, the clubhouse, food service area, practice range and First Tee facility. In
addition, ratings reported by TripAdvisor, Google, and GolfNow should be clearly
posted in the website to highlight the quality and value offered at BPGC.
Increase promotions with Firekeepers/Quality Inn and other area hotels. Working
with hotel staff and hotel sales departments, BPGC can help to give sales teams the
ability to attract events and tourist golfers. Continued promotion through the
Southern Swing marketing cooperative is also recommended.
Player Development this is one of the critical elements to the long-term viability of
municipal golf courses, and should continue to be a point of emphasis at BPGC.
While direct selling, advertising, and public relations are key to building market
share, the future success of public golf is highly contingent on player development,
especially a strong Junior Program (which BPGC has). Also, because of todays
difficult climate for golf operations, tapping latent demand among groups that
traditionally have shown relatively low golf participation such as women and
minorities is more important than ever. PGA data shows every new golfer
developed could be worth as much as $250 per year (10 rounds at $25), and the
common successful player development program produces at least 200 new golfers
per facility. Key best practice recommendations for player development
programming include:
Continue to work PGA programs such as Get Golf Ready, Drive Chip &
Putt, and PGA Junior League, as well as LPGAs Teaching Her and
LPGA/USGA Girls Golf programs. Several of these programs
emphasize transitioning new players from learning to playing golf.
Create programs to provide older, used golf equipment to always be

available free of charge for beginners, and possibly for other needy
prospects via donation or at a deep price discount.
Work to increase womens participation, as females are strongly represented among

the latent demand cohort. This represents a major industry best practice and is
recommended by NGF to every golf course we review. At present, women account
for about 20% of golf participants, but 40% of beginners. There are many reasons
why female golf participation is low, but increasing participation from women is one
of the keys to maximizing revenue. The most common issues relate to golf course
difficulty, retail selection, on-course services (restrooms, drinking fountains), food /
beverage selection, and customer service. 9 & Wine golf training programs for
womens groups are a particularly popular and effective way to engage beginning
women golfers and non-golfers.
Social Media and e-mail marketing should be increased at BPGC. Updating these
sites is not difficult but does take time. If BPGC can work with City agencies to assist
with Facebook updates & messaging this will help to keep the public up to date on
the latest news and offerings. Also, the facility currently has a 5,000-golfer email list.
This list should be exploited at least 2x per month during the golf season to provide
information or offer specials. An effective way to measure acceptance of promotions
is to offer a printable coupon (with expiration) that can be printed or shown on a
smart phone at the golf shop.
Leverage available technology. Technology is one of the most important and tools
available to a golf course management team to create incremental revenue, and
proper deployment is critical in golf operations in 2016 and beyond. Technology
defines and guides the marketing strategy to build a larger customer database,
create customer loyalty and boost revenue. The Citys golf operation would benefit
from maximizing the POS technology that is available within the IBS system. This
system should have access to tools for initiatives recommended by NGF, although
some may require additional training or upgrade of hardware/software. In general,
the City should seek to maximize technology by:
Using the POS system to identify specific customers and spending

patterns (i.e. data mining) to help create effective targeted email
marketing campaigns.
Allowing for social media tools to be integrated into email marketing. This
can be done automatically through delivery tools that automatically
integrate to the leading social media forums, i.e. Facebook, Twitter,
Instagram, etc.
Developing a smartphone application that includes yardage guides and

allows golfers to receive text alerts broadcast from the email system. The
average person checks their cell phone 150 times per day. Having a
mobile application facilitates connecting with the customer.
Review tee sheet pricing daily and determine on-line specials in slow periods,
including times when poor weather is present. As demand builds in certain periods,
pricing can be shown at peak or full price. When demand is soft, dynamic pricing
strategies can help produce incremental play.
Assign responsibility for action plans and promotional events, and track
implementation and results (financial impact). As ideas and processes are
implemented, changes and modifications (counter measures) will need to be
deployed to find solutions. By effectively tracking progress in projects, the business
model at BPGC can be maximized to better achieve desired results.
Other NGF best practices recommendations are:
Host VIP days for key customer groups free snacks or golf training.
Be creative in finding new ways to engage Millennials / young adults (see separate
attachment for on-the-ground examples from other operators).
Conduct yearly customer surveys.
Create strong referral programs for events and season passes get existing
customers to be ambassadors for BPGC.
Review revenue data bi-monthly and compare to prorated budget (15th and 30/31st),
or to prior year results.
Provide brief analysis of revenue trends and ideas to capitalize on opportunities /
provide countermeasures for budget misses.
The recommendations shown above could be implemented within the next 60-90 days and
impact the 2016 golf season. Non-golf events would take some time to implement, but crossmarketing efforts with various City/County entities could begin to show results later this year if
started soon.
ANALYSIS OF POTENTIAL REVENUE ENHANCING PROJECTS

NGF has reviewed the potential for alternative business opportunities at BPGC to determine if
new operating efforts could be created that would improve profitability and help to provide more
income to support bond debt service payments. After interviewing BPGC and City staff, and
conducting a detailed property inspection, two key projects have been identified for
consideration. They are (1) hosting weddings and non-golf event banquet business, and (2)
installing lights to extend business operations at the golf practice range.
Wedding / Banquet Facility Addition

Two potential sites at BPGC have been reviewed to locate an expanded/improved facility to
serve larger golf events, banquets, weddings. The options are: (1) create a new/expanded
meeting/event facility at or near the current clubhouse; or (2) create a meeting facility utilizing
the former clubhouse that is situated in the southeast corner of the property.
Both locations have strengths and weakness from a development/operations standpoint, as

summarized below.
Current Clubhouse Site Strengths/Weaknesses
Former Clubhouse Site Strengths/Weaknesses
Strengths: Visible location to golf customers, ample

parking, nice views of surrounding golf holes, locations
exist for tented area or permanent structure (attached
or unattached to main clubhouse), current/expanded
staff could monitor, manage operations from main
clubhouse, patrons could use portions of the existing
facility as well as new structures.
Strengths: Dedicated site (events only), ample parking

area, attractive golf views exist at this location, sections
of this property have room to add attached or
unattached structures or tents so serve guests, course
maintenance staff can provide some oversight of facility
as it is next to golf maintenance building.
Weaknesses: Multiple users of facility may not be as

attractive to event/wedding clients, golf facility does not
have kitchen/cooking facilities that are typically required
by event customers (grills/ovens/food prep areas).
Weaknesses: Building will require significant upgrades

to make facility attractive, building does not have a
kitchen, parking areas will need repair, heavy screening
of current golf maintenance facility is needed to
separate events from course staff/equipment.
NGF concludes that a facility created at the existing clubhouse area would be more profitable
and less costly to construct, based on the expected added costs involved with repairing and
improving the former clubhouse site to be equal or better than the current clubhouse. Hence,
our analysis will review options/alternatives associated with wedding and banquet operations
located at the current clubhouse site only.
Wedding and Banquet Alternatives
In reviewing site options near the existing clubhouse, as well as the physical structure of the
clubhouse building and its amenities, NGF has identified three options:
1. Construct a freestanding permanent building
2. Construct a freestanding tented facility with foundation
3. Extend the size of the existing outdoor pavilion by extending the roofline and installing
tented siding
Freestanding Permanent Building
City officials and NGF have reviewed potential costs associated with adding a permanent
freestanding structure next to the existing clubhouse. A permanent building would better
accommodate events throughout the year and likely have a nicer overall appearance for
attracting future business. Costs associated with building a permanent structure are
preliminary estimates but reflect likely costs.
Construct Permanent Frame building with interior drywall

construction 40 x 120 (4,800 sq feet) x $125 per foot
Wedding lawn gazebo/structure
Relocating practice green
$600,000
$20,000
$10,000
Pathways/landscaping
$10,000
Electrical/lighting/AC-Heat
$50,000
Tables/chairs/service utensils
$10,000
Contingency & miscellaneous
$50,000
Update existing kitchen/restrooms

*Subtotal (excludes site work/ existing building renovations)
TBD
$750,000
The costs estimated above do not reflect upgrades to the existing clubhouse for kitchen
equipment or improvements to restrooms, if necessary. The existing clubhouse does not have a
grill, ovens, fryer, or warming stations. If these items are not installed, the future wedding/
banquet options will likely need to rely on local catering companies to cook, deliver, set up, and
serve food to banquet guests. BPGC does have the ability to host BBQ and outdoor grilling
events, and serve beer and wine. Costs to install cooking equipment and ventilation system are
estimated at $50,000 - $75,000+/-.
NGF and BPGC management toured the clubhouse area and determined that the area
highlighted above was the most feasible based on location to kitchen entrances, access to
restrooms and existing bar. With ample windows installed in the structure, the facility would
have attractive views of the golf course and would be visible for golfers and other guests coming
to BPGC throughout the year.
The location of the event lawn is a key aspect for the new facility. Many weddings request
outdoor ceremonies. With spring and summer being the most popular time for weddings,
outdoor facilities are often in demand. This location would provide excellent views of the golf
course and an attractive natural setting. Having the outdoor wedding option would allow
caterers or BPGC staff to set up the banquet building for meals before the service. When not
used for weddings, the event lawn be easily maintained as an open area or used for non-related
activities. A sample picture of what an event lawn area set up can look like is shown below.
Sample: Outdoor ceremony seating area
Freestanding Tented Structure

The freestanding tented option is being considered primarily due to cost. Tented facilities are
often used for banquets and can be attractive and function. With limitations on insulation, these
structures often are seasonally used, and are deconstructed and stored in colder winter months.
The proposed location for the tented structure is in the same place as the permanent structure
and would have a concrete foundation. Tented structures are less expensive to create and can
provide an attractive space for events. A sample of an upscale tented structure provides an idea
of the potential that can be achieved at this location.
Sample: Upscale tented wedding facility
Sample: Exterior view of typical tent with removable side walls
Preliminary NGF estimates for implementing a low-cost option to add a tented wedding/event
business at either location:
Concrete pad/floor 40x120
$35,000
Outdoor tent 40x120
$50,000
Event Lawn gazebo/structure
$20,000
Move Practice Green
$10,000
$10,000
Electrical/lighting/portable heating-air
$40,000
$10,000
$50,000
Update kitchen/restrooms
TBD
$225,000+/-
*Preliminary estimates NGF did not conduct engineering/site specific pricing for proposed projects; estimates
reflect local information provided and NGF experience.
This estimate would be for an attractive three-season tented structure that could hold 150-200
guests, depending on seating requirements. These types of facilities are often used for
weddings and events, and heating and cooling units can be installed to control indoor
temperatures. Overall project costs with a tented facility will be substantially lower than a
permanent structure and the foundation of the tented structure could be designed to potentially
hold a permanent structure in the future if funding becomes available for a new structure and
demand for events is shown to be strong enough to cover all operating and debt costs.
Extending Existing Outdoor Pavilion
A third option exists where the current event pavilion, located in the west side of the clubhouse,
could be extended further to cover a portion of the practice putting green, which would then
need to be relocated. Considering all of NGF proposed plans include relocating the practice
green to accommodate an outdoor seating/wedding lawn, this proposed option is not more
disruptive to golfers.
Preliminary NGF estimates for implementing a low-cost option to extend the existing pavilion:
Extend Pavilion 2,500 square feet+/- @ $90 per foot
$225,000
Event Lawn gazebo/structure
$20,000
Season siding/roll down walls
$20,000
Move Practice Green
$10,000
$10,000
Electrical/lighting/portable heating-air
$40,000
$10,000
$50,000
Update kitchen/restrooms
TBD
$385,000+/-
*Preliminary estimates NGF did not conduct engineering/site specific pricing for proposed projects; estimates
reflect local information provided and NGF experience.
Sample: Outdoor event pavilion (note raised roofline)
Sample: Wedding gazebo
Sample: Outdoor event building
Example: Outdoor lawn seating for weddings
The three options have separate strengths and weaknesses. These include cost, functionality,
longevity, and how they impact existing operations. In each of these options, the fact that the
clubhouse does not have a working kitchen that is capable of providing plated dinners or cook a
wide variety of food options makes event and wedding business more challenging. To counter
this, the region has a number of catering companies that can provide drop-off, pick-up, or guest
serving that can be hired. As mentioned above, NGFs preliminary estimates indicate that
$50,000 to $75,000 could be necessary to add cooking equipment and storage to the existing
facility. These costs would allow the golf course to serve a larger menu for breakfast, lunch and
dinner, which could increase overall revenues, separate and apart from revenue generated from
banquets and weddings. If the kitchen is expanded, seasonal or full-time cooks/chef would need
to be hired to staff and operate this new business operation. Currently, the limited menu at the
course allows for part-time and golf related staff to heat and serve items to customers. With a
larger menu, this would not be feasible.
The following chart highlights attributes and challenges with each option.
Extending Existing Outdoor

Pavilion
Strengths:
Strengths:
Strengths:
Higher-quality facility to
compete with full-service
venues in market
Lower cost
Lower cost
Attractive and flexible

space options
Ties in with existing

structure
Use for banquet, corporate

meetings, outings,
weddings all year
Indoor and outdoor seating

options
Less space required

around clubhouse
Facility would blend well

with existing structure
When not in use, tent

could be removed/ stored
to open up space near
clubhouse for other uses
Attached to clubhouse to
access restrooms
Could be enclosed in future

to make full-year venue

Weaknesses:

Weaknesses:
Higher development costs
Need to exit new building

for restrooms
Required putting
green/cart path relocation
Additional operating costs

to maintain, install,
remove, tent each season
Need to exit new tent for

restrooms
Open seasonally
Some customers may not

like tented facility
Requires putting green/cart

path relocation
Extending Existing Outdoor

Pavilion
Weaknesses:
Additional grading required
More costly than tent option
Additional operating costs

to install, use the roll up
walls to enclose structure
when needed
Requires putting green/cart

path relocation
It is unclear if adding kitchen equipment is feasible at this time at the clubhouse given the limited
size of the room. If the City proceeds with adding the banquet operation to BPGC, a study
should be conducted to see what equipment could be added that would serve the golf course as
well as banquets. At this time a viable alternative to adding a full-time kitchen staff and new
equipment is to use local catering companies. Using catering companies can help to eliminate
the need for extra staff, space, and on-site food and beverage expertise.
Projected Financial Impact
Each of the summary projections on the following page assumes the use of catering services.
Revenue streams for BPGC will include upcharges on catered food, room rental, wedding
ceremony site use/setup, beer-wine-champagne sales, and incidental services. Estimates do
not include added potential for golf event revenue due to larger facilities. NGF anticipates that
any option selected will offer a quality experience. Therefore, the duration of the season has
more of an impact on potential revenue than if a permanent or tented/pavilion structure is
offered (each option can be made attractive to customers).
In the summary tables below, we present the three options in order of most required capital
investment to least. The estimated net operating income (exclusive of potential increased golfrelated revenue) resulting from these respective investments would be incremental to additional
income that will result from implementing other operational recommendations.
Wedding/Banquet Revenue Projections Permanent Building
Events
Year 1 start up
Year 2
Year 3
15 @$5,000
25 @ $6,500
30 @7,500
Revenue
$75,000
$163,000
$225,000
Additional Expense
$50,000
$109,000
$150,000
Net Profit Banquets
$25,000
$54,000
$75,000
3.33%
7.2%
10%
Annual Return on Investment of: $750,000
Estimated years to capital payback assuming annual net profit stabilizes at $100,000 = 9.0.
Wedding/Banquet Revenue Projections Extending Outdoor Pavilion
Year 1 start up
Year 2
Year 3
10 @$5,000
20 @ $6,500
25 @7,500
Revenue
$50,000
$130,000
$188,000
Additional Expense
$33,500
$87,000
$126,000
Net Profit Banquets
$16,500
$43,000
$62,000
4.3%
11%
16%
Events
Wedding/Banquet Revenue Projections Freestanding Tent w/ Foundation
Year 1 start up
Year 2
Year 3
10 @$5,000
20 @ $6,500
25 @7,500
Revenue
$50,000
$130,000
$188,000
Additional Expense
$33,500
$87,000
$126,000
Net Profit Banquets
$16,500
$43,000
$62,000
7.3%
19%
28%
Events
NGF Summary
The three options discussed essentially offer small, medium, and larger up front investments to
meet the goal of serving the wedding and banquet market. NGF projects that all three will return
positive incremental net income to the City, though to differing degrees; also, it will take a
varying number of years to pay off the respective investments. Finally, none will add sufficient
net income to pay off the existing annual debt service after.
The permanent building offers the chance of the greatest return (in terms of annual net
incremental revenue), but also carries the highest up front cost and greatest risk if revenues are
less than expected. We project the tented structure to produce a similar net income to the
extended outdoor pavilion and at a lower upfront cost but the tent does not provide the
flexibility that the pavilion extension offers in terms of potential full enclosure if demand is
stronger than expected. The tent remains a good alternative if the pavilion extension and
permanent building options are not feasible due to locational issues with the selected sites.
Also, a tented structure has the ability to work with a variety of sites, provided power and
parking are nearby.
The extension of the pavilion with adjoining event-wedding ceremony lawn - at the existing
clubhouse has the potential to offer a facility that has functional capabilities and offers an
attractive site location with ample parking. By having a more permanent structure (roof and
floor), weather/wind issues are somewhat mitigated, although the functionality will remain
seasonal. Though we expect it to produce net revenues similar to that of the freestanding tent,
the pavilion could be enclosed for year-round activities if demand exceeds expectations. The
immediate access to restrooms and the existing bar area can help make operating events more
efficient and enjoyable for guests.
Ultimately, the decision to invest in some type of wedding/banquet capabilities becomes a public
policy decision. While NGF projects all three options to improve the net operating income of
BPGC, they also will add new capital costs that must be paid off before any incremental net
income could be applied to the existing debt.
Lighting the Practice Range

NGFs review of area courses indicates that the market lacks a lighted driving range. Given
BPGCs large practice range, First Tee facility, and active lesson program, a lighted practice
facility if it can be permitted - can offer players of all skill levels the opportunity to enjoy and
learn golf in the evening after work or school or simply as another source of evening
entertainment. Given the long-summer days in Battle Creek, the major impact of having lights
will be in spring and fall when evening temperatures are mild but daylight hours are shorter. The
cost to install 4-5 standard golf range light poles generally runs between $38,000 and $46,000.
However, NGF was told in May that the City will be able to repurpose light poles formerly used
for outfield lighting at Bailey Parks C.O. Brown Stadium. NGF has estimated that the cost to
rewire and install the poles will be about $15,000, based on inputs from the City.
NGF experience in working with lighted range operations indicates that two primary factors will
impact activity levels: 1) the perception that golf is a fun evening activity, and 2) having lights will
encourage golfers to remain at the course longer after work since daylight hours no longer limit
golf activity. The seasonality of the range will not be impacted by adding light, but daily seasonal
revenues are expected to be increased.
Lighted Practice Center Incremental Revenue Potential
Additional Net Range Income

includes new ball machine (if needed)
Year 1
Year 2
Year 3
$11,850
$12,000
$12,150
59%
60%
61%
The projections above assume that golf course management will be able to increase range
revenues from the current $0.55 per round to $0.85 per round, based on some incremental
hours and some creative new programming at the range (examples of what other operators
have done below). At these per round numbers, payback on a $20,000 investment in lights and
new ball machine should occur within 2 years, even without potential additional food and
beverage revenues that can be achieved as a result of a lighted operation.
A lighted practice range can be a regional attraction for evening sports activities and
entertainment, also offering an opportunity to sell food & beverage at times when the facility
would typically have been closed (after dark). Management could relocate the ball dispensing
machine closer to the tee area to minimize staff needs and the First Tee could schedule
function/sponsorships that revolve around evening activities. If the lighted range becomes very
popular, BPGC could consider adding heated covered stations to make the facility an all-year
operation.
Creative events centered on the driving range are becoming more and more popular with
operators looking to make golf more fun for less committed players, including many young
adults who want their recreation to be experiential. Recent examples NGF has come across
during our studies include Eagle Harbor Golf Club in Jacksonville, Florida, where management
has started Balls & Beers at the driving range. Participants pay a small fee for this event, which
features a keg and unlimited range balls for an hour. An Eagle Harbor golf professional walks
the range giving quick lessons and tips to seasoned golfers and beginners alike.
Morton Golf has turned the City of Sacramentos Haggin Oaks GC driving range into Topgolf
without the computer chips. Helped along by a social media initiative, the range now has
enough young customers to justify being open 24/7 from May through October. Haggin Oaks
invested in a Power Tee system, which is very popular with the younger crowd. They also
installed retail radio sound system; management changes music as the night moves on, and by
late evening the music is exclusively geared to young adults and families. The driving range
also features a putting course, which is utilized for contests and tournaments. Various other
events are held at the venue, which has dedicated food & beverage, including craft beers.
These events are attracting a diverse array of young adults and, as with Topgolf, golfers are
recruiting some of their non-golfing buddies to come along.
NGF Financial Projections

Based on the results of our facility and market review, NGF has prepared a cash flow pro forma
for BPGC with operations through 2020 similar to what is currently in place at the facility. The
pro forma reflects implementation of key NGF operational recommendations, but does not
reflect any potential incremental revenue associated with the considered capital improvements
considered in this report - banquet/wedding structure or lighting the driving range. Overall, the
main impact of the pro forma is to highlight potential rounds increases that will be the main
engine to drive improved economic performance.
Based on market conditions as they exist today, NGF expects the property to improve
profitability to a degree and continue to support day-to-day operations and capital reserve, but
not cover all of the bond payment costs that are scheduled. We expect the operation to improve
with efforts being made by staff to generate new business through existing operational
channels, but these efforts will take time to gain traction. If additional golf courses were to close
in the market, rounds played levels at BPGC would likely rise, providing additional revenue and
profitability to support financial goals.
NGF PROJECTIONS 2016 - 2020

NGF Consulting has created a cash flow model for the continued operation of BPGC, through
2020. The table below shows the projected cash flows for the full operation assuming a
standard market environment over the next five years and normal weather patterns. This
projection is intended to provide a realistic projection of economic performance of BPGC in the
next five years considering NGF recommendations are adopted. Base assumptions in preparing
this financial performance estimate include:
The overall economic condition remains stable, without any significant changes to
the Battle Creek area economy and employment.
Modest rounds increases begin in 2016, with rounds achieving stabilized play of
41,000 by 2020 (with some years falling below and some years rising above this
expected average). These increases are expected to result from enhanced
marketing efforts and increased market share due to the closing of Yarrow Golf
Resort.
Baseline 2016 revenue per round and expense estimates are derived from year-end
2014 results.
Revenue per round adjustments for 2017 through 2020 reflect 1.5%
annual increases.
Annual labor expense is increased by 3% for the 2017 through 2020

period, with other operating expenses growing at 2%.
Cost of goods sold for both merchandise and food & beverage are based on recent
historical experience.
CapEx set aside for both maintenance equipment and other course/clubhouse needs
is equivalent to 2% of total gross revenue, excluding transfer in.
As the NGF projections are estimates of future results, all figures have been rounded
to the nearest $100 for simplicity.

ProForma of Financial Performance 2016-2020
2016
Rounds
2017
2018
2019
2020
39,500
40,000
40,500
41,000
41,000
$86,900
$89,300
$91,800
$94,300
$95,700
Revenue
Membership Fees
Greens Fees
296,300
304,500
312,900
321,500
326,400
Golf Cart Fees
229,100
235,500
242,000
248,700
252,400
Practice Range
23,700
24,400
25,000
25,700
26,100
Misc. Golf Income
39,500
40,600
41,700
42,900
43,500
Merchandise Sales
207,400
213,200
219,100
225,100
228,500
Food & Beverage Sales
173,800
178,600
183,600
188,600
191,500
$1,056,700
$1,086,100
$1,116,100
$1,146,800
$1,164,100
$176,300
$181,200
$186,200
$191,300
$194,200
$86,900
$89,300
$91,800
$94,300
$95,800
$263,200
$270,500
$278,000
$285,600
$290,000
$273,200
$281,400
$289,800
$298,500
$307,500
40,800
41,600
42,400
43,200
44,100
2,300
2,300
2,300
2,300
2,300
Total
Cost of Sales
Merchandise
Food & Beverage
Total Cost of Sales
Expenses*
Salaries & Wages/benefits
Cart Expense
Food & Beverage
Maintenance
255,800
260,900
266,100
271,400
276,800
Utilities
42,000
42,800
43,700
44,600
45,500
General Operating
77,300
78,800
80,400
82,000
83,600
Insurance
11,000
11,200
11,400
11,600
11,800
Total Departmental
$702,400
$719,000
$736,100
$753,600
$771,600
Operating Income
$91,100
$96,600
$102,000
$107,600
$102,500
Course Equipment CapEx
$21,100
$21,700
$22,300
$22,900
$23,300
Clubhouse & Course CapEx
$21,100
$21,700
$22,300
$22,900
$23,300
Total CapEx Reserves
$42,200
$43,400
$44,600
$45,800
$46,600
$1,007,800
$1,032,900
$1,058,700
$1,085,000
$1,108,200
*Net Operating Income
$48,900
$53,200
$57,400
$61,800
$55,900
*Net Before CapEx Reserves
$91,100
$96,600
$102,000
$107,600
$102,500
Adjustments (2% of Revenues)
Total Expense (Incl. COS)
Source: City of Battle Creek. * Expenses do not include depreciation.
RESULTS
The NGF forecast, based on rounds played recovering to the 40,000 range, shows BPGC net
operating income increasing moderately over what was achieved in the 2011 through 2015
period. Net operating income (excluding Transfer In, and before CapEx Reserve) is projected to
stabilize in the $100,000 range. The property will continue to fall short of generating cash flow
sufficient to meet debt needs under the present bond structure. Based on the estimated 2016
through 2025 annual Bond payments ( $240,000), the operation, after set aside for CapEx, will
fall short of covering the total debt service by an estimated $180,000 to $190,000 each year.
Summary Statement
NGFs review revealed that the City of Battle Creek owns a high quality, well managed and
popular golf course asset that is one of the most successful public facilities in a market
oversupplied with affordable public golf. It is clear that the community values the golf course, as
evidenced by its still-high activity levels, the variety of its user groups including a highly
successful and impactful First Tee Program - and the overwhelmingly positive customer reviews
detailed in the report. Binder Park Golf Course also contributes to the community with indirect
economic benefits, as well as non-economic benefits (see Appendix A).
Binder Park Golf Course benefits from strong oversight by City staff, excellent on-site
management by the seasoned and engaged PGA Golf Professional, and a yeomans effort by a
Superintendent and maintenance staff working with a very lean budget. Thanks to this strong
base of operations, the course remains among the most active in the market and expenses
have been expertly managed in the face of declining market conditions. As a result, BPGC
continues to fund its own operations and pay for most capital needs.
Though the City is rightly concerned about the inability of the golf course operation to fund the
Bond payments tied to the 1999 renovation and expansion, NGF believes that the golf course is
a worthwhile endeavor for the City, even beyond its value as a key component of the Citys
open space and recreational offering. The facility contributes some money to the debt service
obligation each year, and should continue to do so in the coming years. We have detailed in this
report that improving market conditions, including the closure of one competitor and potential repurposing of other golf courses down the line, may result in some increased market share for
BPGC. An improving external environment, combined with the successful implementation of
some operational and marketing enhancements recommended by NGF, should result in
enhanced overall cost recovery in the coming years.
NGF realizes that this may be a difficult time for City officials to consider investing more money
into the golf course, given the inability of the Golf Fund to meet its current debt obligations. This
potential reticence would be especially understandable given our analysis that shows the facility
is unlikely, under any reasonable scenario, to be able to pay off the annual debt service under
the current Bond structure. However, we believe that potential new revenue streams for BPGC
that are less associated with demand for rounds of golf (e.g., lighting the driving range and
adding wedding/banquet capabilities) will be sufficient to pay back the additional investment in a
reasonable number of years and, more important, position BPGC to be a more adaptable and
dynamic competitor in this market. Once the new investment is paid off, the golf course should
be able to contribute more to the Bond payments, and perhaps could become completely selfsustaining if the debt can be creatively restructured when restrictions lift in 2019.
Golf will always be at the mercy of variable weather conditions, as well as other uncontrollable
market and economic factors. However, NGF believes that the near term future holds promise
for improved economic performance at Binder Park Golf Course, especially if the supply
/demand balance becomes more favorable and minor recommended tweaks to the operation
prove successful. Even more certain to NGF is that BPGC is a valuable community asset that
the City of Battle Creek can be proud of.
Appendix
APPENDIX A NON-ECONOMIC VALUE OF PUBLIC GOLF
In addition to the direct economic benefit derived from green, cart and other fees, a publicaccess golf business brings other value that cannot be measured directly in economics. Golf
courses provide:
Open spaces
A healthy recreational outlet for residents
A venue to attract visitors
Enhancement to the overall quality of life
Good reflection on the image/brand of a community
Enhancement to local property values
Golf-related jobs and income to the community through purchases, wages, and taxes
Additionally, a golf facility can elevate the quality of life, improve the health and well-being of
citizens and provide an outlet for youth activities and programming.
Indirect Benefits to City of Battle Creek

The indirect, non-economic benefits of municipal golf in Battle Creek include many factors
related to quality of life and the enhancement of community recreation programs. In this case,
there are specific benefits to the City from preserving BPGC, as well as other more general
benefits from having public (municipal) golf courses. These intrinsic value propositions are
detailed below:
Specific Benefits of Retaining City Golf Course

From the Citys perspective, continuing to offer municipal golf service would provide at least the
following benefits:
The generation of political goodwill in the community by taking an action consistent

with expressed interests of the community in maintaining the golf courses and
preserving open space, and in avoiding the potential impacts of redeveloping some,
or all, of the golf course properties.
Provision of high quality golf courses for the enjoyment of the citizens of Battle
Creek, especially those not able or willing to belong to a private golf club.
Marketing value (e.g., in drawing companies or professionals) for the City, related to
being a wonderful community in which to live, with a diverse array of recreational and
cultural opportunities.
Providing an exceptional venue for the scholastic use in practice rounds, inter-squad
competition and tournaments.
Providing a venue for hosting charity tournaments, outings, golf events and other
fundraising activities that presently have direct cost to host at other golf facilities.
Providing enhancement to Battle Creek resident quality of life in areas such as

community-based sport programs, parks and recreation programming and improved
socialization.
Other Benefits of Municipal Golf

Aside from the direct net cash flows that can result from a profitable daily operation and the
specific issues related to the golf courses noted above, there are two main impacts from
municipal golf within a City such as Battle Creek: (1) indirect economic impact; and (2)
recreation/programming impact.
Indirect Economic Impact
Although an economic impact study has not been completed for BPGC, the City can assume
that the presence of this golf facility adds to the economy by:
1. Job creation
2. An in-migration of golfers
3. Direct spending by visitors at off-site establishments such as gas stations,
grocery stores, restaurants, and hotels
4. Sales tax revenue generation
5. Enhanced property values
6. The multiplier effect of indirect and induced spending throughout the local
economy
Recreation and Programming Benefits
Communities with municipal golf courses can offer:
1.
2.
3.
4.
5.
6.
Low fee golf service to residents

High quality outdoor recreation
Junior programs and camps
Scholastic programs
Community outreach
New golfer development programs
APPENDIX B - ROUNDS PLAYED REPORT YEAR-END 2015
APPENDIX C CITY OF BATTLE CREEK DEBT SCHEDULE
APPENDIX D COMPETITIVE FEE TABLE

Peak Green Fees
Facility
Season Pass
Weekday
Weekend
Cart Fee
Single
Couple
Binder Park GC
$23.50
$25.50
$14.50
$565
$920
Riverside GC
$20.00
$22.00
$15.00
$675
$800
$57.00
$62.00
Included
$1,640
$2,060
Bedford Valley GC
Stonehedge N. & S.
Gull View Lake E. & W.
Stoatin Brae GC
Under Construction : Set to open in the summer of 2016 $90-$125
Yarrow G & C Resort
Course Closed - Sold in 2015
The Medalist
$55.00
$62.00
Included
$1,310
$2,096
Cedar Creek GC
$31.00
$35.00
Included
$750
$860
Oakland Hills GC
$27.00
$29.00
Included
$555
$715
Alywn Downs GC
$29.00
$31.00
Included
$550
$695
APPENDIX E GOLF COURSE LIFE CYCLE CHART
APPENDIX F GOLF DEMAND MODEL TABLES

CAGR 1990-2000
CAGR 2000-2010
Population Estimate 2015
Population 2020 Projected
CAGR 2010-2019
Median HH Income (2015 Estimate)
Median Age (2015 Estimate)
Ethnicity
White
African American
Asian
All Other
Hispanic Population
Hispanic
Not Hispanic
CAGR = Compound Annual Growth Rate
5 miles
10 miles
15 miles
Calhoun
County
U.S.
22,932
25,131
0.92%
26,806
0.65%
26,586
26,675
-0.06%
$60,067
43.5
93,198
94,740
0.16%
94,316
-0.04%
95,997
97,123
0.37%
$41,946
39.3
133,085
137,383
0.32%
136,502
-0.06%
137,794
139,028
0.23%
$45,746
40.6
135,981
137,986
0.15%
136,146
-0.13%
137,962
139,354
0.29%
$42,777
39.9
248,584,652
281,399,034
1.25%
308,745,538
0.93%
319,998,423
332,811,226
0.94%
$52,747
37.8
88.1%
3.7%
4.3%
3.9%
78.9%
12.4%
2.5%
6.3%
83.5%
9.1%
2.0%
5.4%
81.4%
11.1%
2.0%
5.5%
71.0%
13.2%
5.4%
10.3%
3.7%
96.3%
5.2%
94.8%
4.4%
95.6%
4.7%
95.3%
17.0%
83.0%
5 miles
10 miles
15 miles
Calhoun
County
U.S.
11,296
2,770
2,911
1.00%
42
2,744
24.50%
3,757
76,285
74,353
40,480
8,050
8,547
1.20%
70
9,718
19.90%
11,192
210,869
263,115
56,834
11,577
12,192
1.00%
183
12,997
20.40%
16,293
309,034
547,867
56,111
11,105
11,720
1.10%
149
12,717
19.80%
15,705
295,599
436,728
123,276,069
17,484,200
18,934,910
1.60%
750,752
32,352,430
14.20%
24,726,660
457,593,900
457,584,400
173
61
104
182
140
28
98
140
144
53
93
146
140
44
91
142
100
100
100
100
Golf Demand Indicators

Golf Demand Indicators
Total Households
Number of Golfing Households
Projected Golfing Households (2020)
Projected Annual Growth Rate
Seasonal Golfing Households
Latent Demand/Interested Non-Golfers
Household Participation Rate
Number of Golfers
Rounds Potential (resident golfers)
Estimated Course Rounds (in-market supply)
Demand Indices
Golfing Household Participation Rate
Seasonal Golfing Households
Latent Demand/Interested Non-Golfers
Rounds Potential per Household (resident golfers)
Golf Supply
Golf Supply
Golf Facilities
Total
Public
Public: Daily Fee
Public: Municipal
Private
Public Golf Facilities by Price Point
Premium (>$70)
Standard ($40-$70)
Value (<$40)
Golf Holes
Total
Public
Public: Daily Fee
Public: Municipal
Private
Non-Regulation (Executive & Par-3)
Net Change
Net Change in Holes past 5 years
Percentage Total Holes Past 5 years
Net Change in Holes past 10 years
Percentage Total Holes Past 10 years
5 miles
10 miles
15 miles
Calhoun
County
U.S.
2
1
0
1
1
9
8
7
1
1
18
16
15
1
2
16
13
12
1
3
15,242
11,402
8,927
2,475
3,840
0
0
1
0
0
8
0
5
11
0
2
11
1,354
4,016
6,032
45
27
0
27
18
0
162
144
117
27
18
27
351
315
288
27
36
27
288
234
207
27
54
27
257,697
187,884
146,556
41,328
69,813
21,555
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
0
0.00%
-10,611
-4.00%
-12,429
-4.60%
5 miles
10 miles
15 miles
Calhoun
County
U.S.
4,518
7,531
0
7,531
11,296
0
0
7,531
4,498
5,060
6,228
26,987
40,480
0
0
5,060
2,915
3,248
3,552
37,889
28,417
0
8,119
5,413
3,507
4,316
4,879
37,407
18,704
0
28,056
5,101
8,611
11,810
15,141
53,692
31,784
75,145
28,806
27,286
1,108
1,847
0
1,847
2,770
0
0
1,847
894
1,006
1,238
5,367
8,050
0
0
1,006
594
662
724
7,718
5,789
0
1,654
1,103
694
854
966
7,403
3,702
0
5,553
1,010
1,221
1,675
2,147
7,615
4,508
10,658
4,086
3,870
Supply-Demand Ratios
Supply-Demand Ratios
Households per 18 Holes
Total
Public
Public: Daily Fee
Public: Municipal
Private
Premium (>$70)
Standard ($40-$70)
Value (<$40)
Golfing Households per 18 Holes
Total
Public
Public: Daily Fee
Public: Municipal
Private
Premium (>$70)
Standard ($40-$70)
Value (<$40)
Indices
Household Indices
Total
Public
Private
Premium (>$70)
Standard ($40-$70)
Value (<$40)
Golfing Household Indices
Total
Public
Private
Premium (>$70)
Standard ($40-$70)
Value (<$40)
Rounds per 18 Holes
Rounds Potential (resident golfers)
Estimated Course Rounds (in-market supply)
5 miles
10 miles
15 miles
Calhoun
County
U.S.
52
64
36
0
0
28
52
43
127
0
0
19
34
27
89
0
28
20
41
37
59
0
97
19
100
100
100
100
100
100
91
110
61
0
0
48
73
60
179
0
0
26
49
39
128
0
40
28
57
51
82
0
136
26
100
100
100
100
100
100
30,514
29,741
23,430
29,235
15,848
28,096
18,475
27,296
31,963
31,962

Binder Park Golf Course Report

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Tel: 269-966-3355

May 20, 2016

NATIONAL GOLF FOUNDATION CONSULTING, INC.

Management has maintained overall operating expense levels, including cost of

including golf. Population growth in the City/County is expected to be minimal over

EXTERNAL MARKET SUMMARY

FINDINGS & RECOMMENDATIONS

Alternative Operating Structure Considerations

Analysis of Potential Revenue Enhancing Projects

Estimated Capital Cost

NGF Summary Wedding/Banquet Addition

Lighting the Practice Range

FINANCIAL ANALYSIS - CASH FLOW RESULTS

Golf Fees ............................................................................................................................ 9

Binder Park Golf Course - NGF Summary 2016..............................................................13

External Market Summary..................................................................................................23

NGF FINANCIAL PROJECTIONS............................................................................................43

Appendix B - Rounds Played Report Year-End 2015 .........................................................49

NGF REVIEW 2016

Overall condition and operating efficiencies of Binder Park Golf Course.

A review of golf industry standards and norms of operation.

A review of BPGCs present physical condition and capital needs.

Providing operational best practice recommendations to help expand the customer

Provide strategic guidance on issues such as operating structure and potential

Binder Golf Course Overview

LOCATION AND ACCESS

Map View of Binder Park Golf Course

Binder Park GC Summer Landscape

Winter Golf Course Landscape

Clubhouse Views from the restaurant

Operating Structure and Staffing

18-Hole Cart Fee

Single Membership / Annual Pass

Family Membership / Annual Pass

Capital Projects/Equipment Review

Activity and Financial Performance

Binder Park Golf Course

Source: City of Battle Creek.

Revenue & Revenue per Round

Green + Member Revenue/Rd

Cart Rev. / Round

Practice Range Rev. / Round

Food & Bev Rev/Rd

Facility Revenue & Expense Overview

Binder Park Golf Course

Golf Cart Fees

Misc. Golf Income

Food & Beverage Sales

Total Expense (Incl. COS)

Net Operating Income

Source: City of Battle Creek. * Expenses do not include depreciation.

Bond Debt Schedule

BINDER PARK GOLF COURSE - NGF SUMMARY 2016

External Market Analysis Summary

Participation - The national golfer number (participation) appears to be continuing a

According to Kalamazoo-based W.E. Upjohn Institute for Employment Research,

Source: Weatherbase, Battle Creek, MI

Golfers per 18 Holes

Source: National Golf Foundation

Golf Course Market Supply / Demand Summary

Key Market Competition

Riverside Country Club

Bedford Valley Golf Club