SDMGA: Watchdog or Whitewash?
SDMGA response to The “Watchdog Report” – “Counting the cost of Staging the U.S. Open” (U-T November 24).
The report misses a key point. The green fees of San Diego golfers paid for almost all of the expenses of the Open but the revenues went either into the City’s general fund or to the so-called “’Friends’ of Torrey Pines”. ______________________________________________________________________
Watchdog or Whitewash?
1. Covering Up the City’s Raid on the Golf Enterprise Fund:
The “Watchdog report” – “Counting the cost of Staging the U.S. Open” (U-T November 24), misses a key point. The green fees of San Diego golfers paid for almost all of the expenses of the Open but the revenues went either into the City’s general fund or to the so-called “’Friends’ of Torrey Pines” who took back what they marketed to the community as their $3.2 million gift of the South Course renovations. The $9.2 million of the expenses of the Open were almost all paid by the Golf Enterprise Fund (the fund made up of greens fee revenues which not only pay for all city golf, but contributes 2.3 million to the General Fund every year) while virtually none of the revenues to the City went to the Golf Enterprise Fund.
By lumping the general fund and the Golf Enterprise Fund together in its chart and totals, the article uncritically accepts more pension-fund-like accounting from the City. Also not mentioned in the article, but itemized in the chart on page 8, is the fact that Torrey Pines lost approximately $1,879,333 in greens fees, primarily on the North Course, which was closed to 18 hole play for seven months. Again this money was lost to the Golf Enterprise Fund, just the golfers paid, not city taxpayers.
Here’s how the U.S. Open exploited municipal golfers: The USGA made millions, but did not pay a dime of rent to the city for taking the North Course for seven months (and it still shows the scars of the damage done by U.S. Open roads, trucks, tents, food prep facilities). The “Friends of Torrey Pines” got their money back. “The Friends” have claimed that the $3.2 million gift money returned to them is going to charity but no one being held accountable for that claim. The City claims to have gotten increased revenues.
2. Who paid? Local golfers paid!
Here is what these numbers will mean for us: A huge increase in South Course greens fees is scheduled for July of 2009:
· $73 + cart fee for residents on weekends (55.8% increase from current fee of $49)
· $58 + cart fee for residents on weekdays (34.9% increase from current fee of $43)
· $44 + cart fee for seniors (51.7% increase from current fee of $29.)
These increases threaten to price all but the wealthiest San Diegans off the South Course starting on July 1, 2009, effectively removing the South Course from being a public park.
3. How we can remedy this unfairness:
1) Ask the USGA to pay back the $1.9 million in lost greens fees. Even though they are not contractually bound to do so, they should be asked to do so as a matter of fairness. They should not rip off the only municipal golf course to host a U.S. Open, especially in light of the blatant conflict of interest – Jay Rains who brokered the unconscionable deal ripping off the city is the Executive VP of the U.S.G.A
2) Ask the “Friends of Torrey Pines” to give back the money they expropriated from the Golf Enterprise Fund;
3) Freeze greens fees on local golfers at current levels. We have paid for the Open in increased fees and disruption. It is time to stop ripping off local golfers.
4. The U-T article is but another example of the City’s obfuscation.
The revenue and expense breakdown in the article does not distinguish between monies paid by the Enterprise Fund and monies paid by the General Fund. This masks the true impact of the U.S. Open on the Enterprise Fund and on local golfer’s greens fees. The article also accepted uncritically other aspects of the City-Century Club spin:
- That the Friends of Torrey Pines (an off-shoot of the Century Club) “gave” $218 thousand to the Enterprise Fund when it actually raided the Fund by taking back $3.2 of the $3.4 million it put up for the South Course Renovations.
- Estimates of revenues from the Open that do not clearly subtract the revenues that might have been anticipated to have come from other tourists who would have used the hotel rooms and restaurants during mid-June which is a heavy tourist time.
- Estimates of economic activity in the community that are often wildly inflated
5. The U-T article also fails to explore issues which are apparent to anyone who is knowledgeable about golf issues:
- The conflicts of interest by attorney Jay Rains, the head “Friend” of “Friends of Torrey Pines” who negotiated what everybody admits was a lousy deal for the City. He sold the deal to the City, represented his clients and the Century Club in forming the Friends of Torrey Pines and soon after the negotiation of the sweetheart contract that so unfairly benefited the USGA, became a USGA Executive Committee member (and is now Executive VP).
- The membership of the Friends of Torrey Pines which I understand includes hotel owners like Bill Evans of the Lodge at Torrey Pines who gained enormous value for his brand by having the U.S. Open staged at Torrey and Century Club members with an economic interest in hotel and tourist business
- The sweetheart deals that allows the PGA gets to stage the Buick Invitational annually.
- The ways in which the rising price structure at Torrey Pines benefits hotels like the Lodge at Torrey Pines and the Hilton. The fewer local golfers who play Torrey Pines because of price increases, the more these Hotels can use Torrey Pines golf course as a way to attract tourists without having to pay the costs of maintaining a golf course. Most destination resorts which have a golf course lose money on golf operations and use golf as a “loss leader” to lure in hotel guests who pay handsomely for rooms and other hotel services.
- The plans of the Century Club, a private membership organization for the wealthy, to expropriate public parkland for office space for their operations in a “Tournament Support Building”. The parking lot built for the Open appeared to include the drainage and electrical infrastructure for both this Tournament Support Building and the proposed new clubhouse.
- The relationship between Bill Evans of the Lodge at Torrey Pines and Mayor Sanders: Evans was not only a campaign contributor to Sanders, but hosted fundraisers for him. Was the structure of the U.S. Open, the fee structure at Torrey Pines, or the plans to build an unneeded clubhouse (moving it to a location to the North which destroys the 18th green on the North Course and coincidentally provides a much better view from the Lodge at Torrey Pines.
6. The same old story.
The U-T article appears to be part of the customary good old boy structure in San Diego. In this case a group of rich oligarchs (here Bill Evans, Jay Rains, and the Century Club) who contribute to the Mayor’s campaign war chest, have undue influence on City policy to shape it in way that benefits the wealthy and disadvantages the ordinary citizen. The Union-Tribune, whose owners are part of the oligarchy, functions as a propaganda arm to support, or in this case whitewash, the oligarch’s plans.
Watchdog or Whitewash?