After losing money for the last six years, the Arizona company that manages Stonetree Golf Club, the city-owned golf course in Killeen, has proposed fee increases to recover costs associated with maintaining the property.
“Over the last three years, we’ve seen substantial increases in cost,” Tony Marino of Indigo Sports said. “That has led to increased pricing of fiscal year 2023.”
Marino is regional director of operations for Indigo.
“Each year, we submit … an annual budget,” he said. It’s “an annual plan to be reviewed and ultimately finally approved by City Council. Any raised pricing over 5% requires council approval.”
The forecasted net income for Stonetree at the end of this fiscal year is $1,965. In fiscal year 2023, that number is expected to reach $70,355 if council members approve a resolution on the new rate structure.
“The proposed structure increases at Stonetree Golf Club would begin in October of the new fiscal year,” Killeen Executive Director of Recreation Joe Brown said.
Marino said the proposed increases are based on ‘what drives the cost and competitive analysis of the market and where Stonetree compares in that market.” The last rate increase — less than 4% — came in 2020.
“At this point, we don’t see that needed this year,” Marino said. “We see a larger amount needed. We want to make sure Stonetree is a fit in the market and was affordable to the citizens of Killeen while still being profitable and able to improve the golf course.”
In 2020, the rate increase of less than 4% was “solely related to green fees.” According to a presentation by Marino on Tuesday night, the City Council “must approve all green fees and cart shed rental rate changes that would exceed 5% in any 12-month period.”
But “some of these are one-time expenses,” Marino said. “Others are annual operating expenses. We are budgeting a proposed a 12% increase in 2023 in expenses. A lot of this is driven to increased labor costs and to mention supply, in general. The revenue proposed increase is also 14% for next year.”
Improvements since June 2019 include weed reduction across the course, adding about 60 trees, replacing irrigation control panels, adding lighting to the driving range, creating turf-management best practices, adding new tee markers, a wood bridge on the second hole and bunker sand and clearing creek and lake beds from overgrowth.
“Some of them are one-time expenses and others are ongoing,” Marino said. “As you can see, there’s been many we have talked about previously. Greens have been redone. Ten of the fairways have been redone with modern turf. It’s just normal practices that need to be done to the golf course.”
Councilman Jose Segarra asked if club members will pay the higher fee when they renew their memberships.
“Inflation hits everyone, and golf is no exception,” he said. “And I can understand that. When you raise the fees on your annual membership, does that include current memberships or is everybody just going to pay the higher fee as they renew?”
Marino said current members will pay the new fee, including for those 65 and older and veterans.
“Those fees needed to increase,” he said.
And Councilman Ken Wilkerson praised improvements at Stonetree.
“I played every one of those courses (in the presentation), and we are at the top of all of those courses, even with the conditions,” he said.
Council members took no immediate action on the fee increases because Tuesday’s meeting was a workshop.