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The original item was published from 4/1/2016 11:33:16 AM to 5/1/2016 12:00:02 AM.

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Posted on: April 1, 2016

[ARCHIVED] Salmon Run Management Change

A change in management at Salmon Run golf course and the temporary closure of the course was announced today by Brookings City Manager Gary Milliman.

“The lease agreement with Wild Rivers Golf Management, LLC (WRGM) has been terminated and we are arranging for an interim golf course manager,” Milliman said. “We plan to have the golf course back in operation by Tuesday, April 5.”

Meanwhile Ocean View Diner, which occupies a portion of the clubhouse building, will remain open. The Diner is open 7:00 a.m. to 1:30 p.m. daily. Ocean View Diner entered into a sublease agreement with WRGM in 2015 and the City is honoring that agreement during the transition period.

“We have entered into an agreement with the Early Management Team, Inc. (EMT), for interim management of the golf course,” Milliman said. “City staff is also performing a comprehensive health and safety assessment of the course and all facilities. We will be moving along as quickly as possible.”

The agreement with EMT is for an initial term of 30 days, and can be extended. “We expect to develop a longer term agreement over the next few weeks,” Milliman said.

Milliman said the City is not assuming any of the debts or obligations of WRGM. “Any vendors, contractors or individuals who have outstanding issues with the now former golf course management should contact Ed Murdock, who is the principal of Wild Rivers Golf Management, LLC,” Milliman said.

Valarie and Gary Early are the principals of EMT. They are long-time local residents and business owners, having operated Early Fishing, Inc, since 1990. EMT President Valarie Early has managed several resource-related businesses in Oregon and Alaska, and serves as Chair of the Oregon State Marine Board. She has been extensively involved in resource and education related issues. In addition to managing several resource related businesses, Gary Early is the head golf coach at Brookings Harbor High School and has experience in tourism marketing. An avid golfer, Gary Early has a 5.4 low golf handicap index and has worked as a golf course groundskeeper.

“The Early’s provided the City with an outstanding business plan for management of Salmon Run. They have a reputation for good business acumen,” Milliman said.

The City will not be paying a fee to EMT for management services. EMT will retain any profit from the business operation as their management fee.

“The Early’s are currently on site working to get the golf course in shape for a Tuesday reopening,” Milliman said. “The parks and public works employees are providing assistance. This is a critical time to prepare the golf course for an active golf season.”

Salmon Run Golf Course is located on 182 acres owned by the City. The golf course has been leased to a private operator since it was first developed in 1998. The City entered into a new five-year lease agreement with WRGM in June 2014.

“Through this change, the golf course basically becomes a department of the City and we are retaining EMT rather than utilizing City employees to manage that department,” Milliman said.
“The lease was terminated primarily due to the deteriorating condition of the golf course and the clubhouse, and the lessee’s financial inability to make corrections or remain current on taxes,” Milliman said.

“WRGM continues to own a lot of equipment and other assets located at the golf course. We are in discussions with Mr. Murdock concerning the use of these assets…which are pledged as collateral in the lease agreement…to satisfy the unmet financial obligations of the lease, Milliman said. We have arranged for an appraisal. The City may also offer to purchase some of the equipment.”

“WRGM has been very cooperative in winding down their business at the golf course and the City’s goal is to complete this change with the best possible outcome for all parties…including WRGM, the golfing community and the City,” Milliman said. “There has been no animosity in the transaction.”
Milliman said an example of the golf course financial distress was that the lessee started a project to remodel and put a new roof on the clubhouse in November, 2015, and has been unable to complete the project.

In July 2015 the City Council approved waiving the $20,000 annual lease payment and allocating another $8,984 from a City reserve fund established to secure a permanent water source for the golf course to improve the golf course water distribution system. An additional $20,000 lease payment would have been due in August.

Because the golf course was leased to a private operator, the property is subject to property tax at about $18,000 annually. “WRGM has been unable to bring the tax payments current, which is a requirement of the lease agreement,” Milliman said. The City does not receive any tax revenue from the property as it is located outside of the City Limits; all of the tax proceeds go to the County, school district and various special districts. “Going forward, we have requested a property tax exemption from the County Assessor as the property is no longer leased as a private business, but will be operated as a municipal course by the City,” Milliman noted.

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