Last week, City Council unanimously approved the lease and management of the Battleground at Deer Park Golf Course to Touchstone Golf. The agreement comes with renewed optimism in the city-owned facility that has been a lightning rod for constantly being in the red.
Touchstone Golf takes over the golf course, club house, Republic Grill restaurant, pro shop, driving range, three-hole practice course on May 29. City manager Jay Stokes said the city of Deer Park did not relinquish ownership of the course.
Touchstone will have personnel on site this week to begin the transition of operations from the city. According to its website Touchstone Golf leases and/or manages five courses in the state, including Wedgewood in Conroe. The others are in El Paso, Austin, Brownsville and Tyler.
"The operations will proceed as normal through Memorial Day," Stokes said. "The course will close on May 28 and then re-open May 29 under Touchstone's operations. The users of the golf course won't notice any change initially."
The city and Touchstone's agreement is for 10 years with four renewals of five years each. Per the agreement with the city, Touchstone will pay the city of Deer Park $5,000 per month to lease the course. The city will also receive a 3 percent of golf merchandise and food and beverage sales and 5 percent of golf-related sales generated by all the facilities. These percentages will escalate over the initial years of the agreement beginning in year two.
In year two, the city will receive 33 percent of the 3 and 5 percent sales agreements. In year three, that number will rise to 66 percent of the 3 and 5 percent total. In year four and going forward, the city will receive 100 per cent of the 3 and 5 percent of sales total.
Also, Touchstone will cover maintenance costs of the course up to $18,000 per year and irrigation costs up to $15,000 per year. The city will cover annual costs above those numbers.
Parks and Recreation Director Scott Swigert said the facility will still be under his department, although its operations are contracted to Touchstone.
"We still have a commitment to the city in this this is still a parks and recreation facility," he said. "We are looking at this as a relationship with Touchstone because if you look at the percentages once they start coming our way, the better the golf course does, the more that comes our way into the city."
Swigert said Touchstone estimates it will generate $2 million in revenues, which would equate to about $80,000 per year in the sales percentage back to the city.
"It can add up pretty fast," said Stokes. "There's $60,000 per year, plus the sales percentage after the first year. On top of that, we do not have to pay the first $33,000 on maintenance and irrigation."
"The grounds, the buildings, they are still owned by the city," Stokes said. "We still will have the responsibility of keeping those maintained. Keep in mind that we did not sell the facility. There will still be some costs of maintaining our assets. Through this lease, we have a partner that has the expertise in golf course operations who is paying us per month and committed to sharing a portion of the costs and that will reinvest money."
The money generated through the lease agreement will go into a fund that will be used for capital improvements and repairs at the course.
"It's a 16-year-old course and the lease agreement could run 30 years," Swigert said. "There will be some maintenance and upgrades needed at the facility as time goes on."
In April, Touchstone Golf CEO Steve Harker spoke in front of council to discuss some of the company's plans for the course.
Although he said there was a need for improvements at the course, there was no standard of expectations to work toward. He said the group has consulted with staff and the city to correct that issue.
He also said Touchstone will make changes to the Republic Grill Restaurant.
"We don't think it's operating as it should or as it could. The setup is a little awkward," he said.
Touchstone's design team will examine different options to make the restaurant more appealing. Touchstone would make a $200,000 in first-year improvements and an additional $150,000 in year two, he said.
Harker said Touchstone will look to expand the scope of programming at the golf course.
"You have one of the most incredible driving ranges and practice facilities and yet there are a limited number of golf lessons given; a limited number of instructional programs for youth, family and seniors. We are going to develop a learning center concept," he said.
Touchstone is investigating ideas to better combine the driving range and three-hole practice course to better serve persons wanting to brush up on their game.
By doing so, Harker hopes more area residents are engaged in golf and enjoying the facility.
Harker also said Touchstone will also concentrate on adding programing that will bring more events and catering opportunities to the golf course facilities.
"What all of this means to the city is that the revenue is going to grow," he said.
Swigert said the employees of the course would be retained by Touchstone during the transition phase except for marshals, starters and the course's business operations supervisor.
Touchstone does not pay starters or marshals, but has a program in place for volunteer services where persons can accumulate free rounds of golf. After Touchstone receives the proper permitting, it will not retain the operations supervisor. Swigert said efforts are being made to place that person in a new position.
The volunteer program is a part of a service-oriented Touchstone Golf Foundation, which partners with the local community for charity and schools.
"That was a big thing for us, is that they want to be part of our community," said Swigert.
"They didn't just want to operate here. They also want to be contributors to our city," Stokes said. "Their foundation partners the course with different community organizations."
In Texas, the Touchstone Golf Foundation partners with the Susan G. Komen Foundation for breast cancer research, the Wounded Warriors Project and others.