During the 2022 season there were 22,994  rounds played at the Championship golf course with an average revenues of $90.63 per round.  Sadly the expenses to produce each round was $120.53 [1][1]so only 75% of costs were recovered resulting in a loss of $688,210 for the season.

The Mountain course fared no better. 

Rounds played were 16,832 with an average revenue of $40.77 per round but expenses averaged $58.93 per round so only 70% of costs were recovered.  The course lost $305,669.

Why is this important?

 

1)    Each property owner (YOU) paid the equivalent of $84 to subsidize operations of the Champ Golf Course – and $37 for the Mountain Course. Who wants to pay for these subsidies – and not even get a round of golf?

2)    The money-losing results are the opposite of the pricing policy adopted by the Board in March 2022. Policy 6.2 states, “District Pricing Structure should ensure that revenues are sufficient to cover full cost of providing services to its residents, guests and visitors.”     

Instead, the prices that were set for Picture Passholder were an average of $62 per round for season passes and $64 regular play), which were far below the amount that should have been set by policy: $95.26 (the amount that would cover operating costs with overhead).

3)     547 individuals received bargain rates averaging $29 per round rather than paying $95; the $95 rate would cover operating and fixed costs. Who were these special people? Board Policy 6.2 does not allow for such freebies.

4)     Despite the policy not being followed, the General Manager received a raise of 12.5% in July, 2022. In what industry could an executive get a large raise – by NOT implementing a policy adopted by the Board?

Over the past seven years losses at the two golf courses have been over $1,000,000 per year. The losses have been funded by the “Facility fee” paid annually by all dwelling units in the Incline Village-Crystal Bay area.  The “Facility fee” is a “tax in fees’s clothing”. In 2022, it was $780 for Incline Village property owners and embedded in the Washoe County tax bill. The table below shows the legal differences between a tax and a fee.

Source: https://www.washingtonpolicy.org/publications/detail/is-it-a-tax-or-a-fee

 

In 2022, picture pass holders and their guests were 75% of players at the Championship course.  If tourists (non picture passholders/guests) are to foot the bill, with no change in rates for picture passholders and their guests, visitor’s rate would shoot up $130 per round. That is not competitive. And to expect the marginal revenue from sales of food & beverage or merchandise to cover the costs is unrealistic. It is questionable whether these activities make money when their full costs (including overhead, capital and debt) are considered.  IVGID does not provide any profit or loss on these items; only revenues are provided.

 

In the U.S., roughly 25% of golf courses don’t turn a profit. So how do other golf courses in the North Tahoe area perform?  There are 16 courses in the Tahoe area. Five are government owned and operated and four lost money. The fifth, Ponderosa, is owned by the Truckee Airport District and does not publish financial results.

 

Based on the pricing policy adopted in March 2022, changes need to be made at both the Championship and Mountain Golf courses for the courses to break-even. But perhaps even a bigger change needs to be made: not rewarding the General Manager when Board policy is ignored.

 

Golf Course	Owned by	Hi season rack rate	Comments on operations
Brockway	family-owned (9 hole)	$55
Coyote Moon	Coyote Moon LLC	$190	$109,000 PPP loan from US Govt
Gray’s Crossing	Tahoe Club Co LLC	$260	$1Million+ PPP loan from US Govt
Northstar	EPR Properties; operated by Vail Resorts	$100	peak price may be higher
Old Greenwood	Tahoe Club Co LLC	$260	PPP Loan (see above)
Ponderosa	Truckee Airport District (9-hole)	$40
Squaw Creek	Squaw Creek Associates, a. California General Partnership	$129
Tahoe City	Tahoe City Public Utility District	$90	Loss
Tahoe Donner	HOA owned	$180	Loss
Schaffer’s Mill	HOA owned	$215
Bijou	City of South Lake Tahoe		Closed for 2 years (COVID)
Edgewood Tahoe	Edgewood Companies (Park family)	$320
Lake Tahoe	American Golf Corp.	$105
Tahoe Paradise	Tahoe Paradise Golf Course, Inc.  (Beeman Family Trust)	$80

 

The authors, Cliff Dobler and J. Gumz, are long-time resident and property owners of Incline Village and registered voters. Cliff Dobler is an avid golfer, and has owned golf course properties.