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Running the numbers
The annual budgeting process has become a delicate balance of art and science for golf course superintendents.
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There’s a right way and a wrong way to do just about everything. In golf course management, the trick has always been to distinguish the right from the wrong to suit one’s specific needs in a specific situation — the long version of no two golf courses are alike.
Fitting that application of the profession in particular is the superintendent’s annual financial plan or, simply, the budget. Practically every superintendent must develop one and must present one to ownership. In doing so, the really good maintenance managers demonstrate first-rate skills in communications, salesmanship and rationalization.
If a superintendent lacks one or more of those skills, he or she is likely to go without a lot of what it takes to do the job according to accepted standards. Many of the powers that run golf courses in today’s tight times won’t tolerate anything less and usually expect more.
The expertise contained within a course’s operational budget goes far beyond dollars and cents nowadays. The industry, already beset by an ongoing soft economy, now faces dramatic price increases in such maintenance staples as fuel, fertilizer and water.
As Bill Andrade, longtime superintendent at a large public venue in northern California, says, “We’re basically doing the same work as in the past, but that work is costing much more now. At the same time, it’s tough to pass it on — we have to be very careful with what we do with our green fees or we’ll scare people away.”
Budgeting expertise doesn’t come easily, either. No matter the size of the operation or the locale, there is a premium put on the need for a detailed, yet easily understood, golf course budget. But for many, that’s easier said than done.
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Maquoketa CC’s fourth hole rises toward the clubhouse, which includes a restaurant and bar. The club has been a popular venue for corporate and charity events since its opening in 1974. Photos courtesy of Maquoketa CC |
Art or science?
It’s been said that the budgeting procedure is either an art or science, or both. Chris Carson, the Class A superintendent at Echo Lake Country Club in Westfield, N.J., says it is a lot of both, but he favors the artistic, or creative, side and can present compelling support.
Even among the most notable of his peers, Carson is
an overachiever as superintendents go and is definitely one of
the profession’s staunchest champions of using the budgeting process to bring into sharp focus golf course management’s big picture.
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With an annual operating budget of less than $90,000, 28-year GCSAA member Dave Ostert emphasizes efficient spending and keeping things looking good and in good condition. Appearances at Maquoketa CC attest to his efforts, along with those of many members who volunteer their help around the course. |
Besides an innovative 23-year career at Echo Lake CC, Carson for the last decade has spent his off-seasons teaching the basics of golf course budgeting in the turf management program at his alma mater, Rutgers University. He’s an accomplished author — a two-time winner of GCM’s Leo Feser Award for his works stressing professionalism and has published “Your Budget is a Sales Tool” in the USGA’s Green Section Record. At the 2009 GCSAA Education Conference in New Orleans, he’ll present a seminar titled, “A Plan-Based Budget Can Help You Succeed.”
“The budget is a plan, and the plan has numbers assigned to it. Getting people sold on the plan makes it easier to get people sold on the numbers,” says Carson, who notes that the science of budgeting is understanding the nuts and bolts, the dollar figures, that come from the owner and understanding the financial picture of the facility and its cultural goals.
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Ostert has spent his entire career (34 years) at Maquoketa CC, learning the fine art of making ends meet at the nine-hole facility in east-central Iowa. |
Taking the next step
But it’s the art of budgeting, the process, that can help a superintendent succeed as a professional, he adds. The bottom line is that the budgeting process is a vitally important part of the job, and the best superintendents are very good at it. It’s also a year-round process where every opportunity to sell one’s plan, goals and vision should be taken, to “plant the seeds in people’s minds,” as Carson says.
“Proper planning and budgeting show leadership. I look at people who succeed and I see people who are excellent delegators, excellent communicators and excellent writers — people who really invest thought in the process of promoting their operation and the needs of the golf course to the people who make the decisions,” says the 23-year member of GCSAA.
“I see other people who are excellent grass growers, but who haven’t achieved the level of success they could because they haven’t recognized the communications tool or because they aren’t equipped to do it. There is a big difference between a budget document and the budget process, and communications is a huge part of that.”
Budgeting ABCs at the TPCs
The nuts-and-bolts approach described by Carson is applicable in many cases and generally by the larger golf operations. It’s embraced, for instance, by the PGA Tour’s Tournament Players Club network under the guidance of a handful of both former and working superintendents who have been in the agronomic end of the golf industry for more than 100 years among them.
The Tour currently specifically operates 18 TPC properties and, as one might imagine, keeps close tabs on the overall budgeting process.
“With economic stresses applied to our clubs and the golf business in general, (budgeting) is certainly something we have to take a much stronger look at,” says Cal Roth, vice president of agronomy for PGA Tour Golf Course Properties.
TPC superintendents, who are responsible for the golf course, landscaping and grounds at each respective club, work with a zero-based budgeting blueprint or template. They research and price products, estimate usage and apply the numbers in the appropriate turf management program.
“It’s both structured from the standpoint of fitting the system we have, as well as it’s individualized because it’s their business plan. It allows the superintendents to plug in not only their respective figures, but also their specific wishes,” says Roth.
Roth, a member of GCSAA for 29 years, notes that the network’s superintendents, along with each club’s general manager, work closely with Collier Miller, CGCS, the Tour’s director of agronomy and golf course maintenance, and his regional superintendents, Dennis Ingram, CGCS, and Mark Johnson, CGCS. The aim is to achieve a maintenance plan that fits within the overall club budget. From there, Miller’s team brings the whole enchilada to the Tour Golf Course Properties hierarchy.
The same yet different
The TPC template is useful because the network includes courses throughout the country. The procedure makes for easier development and reviewing of each turf management program. The wiggle room is equally important because each property has its own nuances and marketplace niche.
“Obviously, each club is treated differently,” says Miller, who was a golf course superintendent for 16 years and has been with the TPC network since 1994.
If there is one thing above all others that Miller and his regional agronomists look for in a budget-savvy superintendent, it’s the knack for substantiating their financial plan.
“Solid justification,” Miller calls it. “The strengths for a superintendent are to have a thorough understanding of the accounting and budget processes and particularly the ability to justify the budget numbers — essentially supporting documentation — and then communicate that justification in an understanding way to management. We have the same issues at our level as others do. We have to sell all of the budgets cumulatively to our management team. So what I need is good justification from each individual site. Our philosophy has always been one of providing a very detailed, descriptive budget that provides justification for the number.”
One for all
Miller, who has been a member of GCSAA for 26 years, notes that the golf course budgeting process has to be cognizant of the TPC business plan as well.
“It’s influential to a certain degree. The product (the golf course) has to be there, and we all recognize that. You have to consider the business plan of the club and how it’s able to afford and sustain the maintenance budget,” he says.
That said, however, Miller adds that a major spike in the process is the TPC brand and the association with the PGA Tour.
“We have a reputation to uphold and we budget accordingly to support that, regardless of whether an individual club’s business can support it or not,” he says.
Miller agrees with Roth that tight times bring both good budgeting and sharp scrutiny to the fore. But efficiency only goes so far, he says.
“It’s become very important not only to justify your number, but also to be able to identify and articulate that if you don’t spend X amount what the sacrifices and consequences are going to be.”
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Sunol Valley GC’s aptly named Palm Course fronts the large clubhouse. While play has been down in recent years, the facility still has more than 100,000 rounds annually. Photos courtesy of Sunol Valley GC |
Field work
For the everyday practitioners out in the field, the budget process may vary from strict adherence to a fixed set of rules, to filling in the blanks, to flying by the seat of one’s pants. The following are three examples selected by GCM for their distinct physical and financial differences, with one common denominator — all are in the care of veteran superintendents who know a thing or two about budgeting to fit their needs and, sometimes, to survive.
Bill Andrade, Sunol Valley Golf Club, Sunol, Calif.
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The current soft California golf economy has made Bill Andrade rely on his budgeting expertise at Sunol Valley GC, a 36-hole public facility where he has been superintendent for more than 30 years. |
Quoted earlier here bemoaning the fact that the same work done for so long now costs so much more, Andrade is well aware of the impact of the slumping golf economy. He’s been at Sunol Valley GC, a 36-hole public facility northeast of Fremont in the Bay Area, for more than 30 years and has learned the art of making do.
The property is owned by the city and county of San Francisco and leased to the family of the late Frank O. Ivaldi, who developed Sunol GC’s Palm and Cypress courses 40 years ago. In its heyday, Sunol hosted more than 130,000 rounds annually and was a favored venue for corporate and charity events. In recent years as the state’s economy cooled, rounds have dropped off by 30,000 or more a year while prices for fuel, labor and turf care products have soared. Meanwhile, Andrade has been faced with a drastic change in budget procedures and not enough change elsewhere.
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Sunol Valley GC (the Cypress Course is shown here) is leased to its founding Ivaldi family from the city of San Francisco. |
“We’re kind of old-school when it comes to the budget — we go month-to-month now. There’s no set structure,” the 17-year GCSAA member says of the switch from a more traditional annual budgeting process about 10 years ago. “We pretty much stay with our same purchases throughout the year and repeat a lot of our programs. A concern of late has been the increases in equipment costs and repair costs.”
Andrade’s annual expenses are in the $700,000 range, with $380,000 for labor. He has a 36-hole crew of 13, including himself, but the staff is unionized, including the superintendent, and receives corresponding wages and benefits.
Another concern is that the facility’s irrigation system is the original 1968 installation and is plagued by inefficiency, poor coverage and other problems. However, Andrade points out that a new pump station was installed within the last year and he hopes one thing will lead to another. Everything considered, he has developed a good rapport in the monthly discussions about costs, revenue, needs, etc.
“It’s like they have this trust in me; we talk about things all the time. The bottom line is always the cost. There are certain purchases that they have to OK,” Andrade says, noting that the key for him has been a constant forward-looking attitude. “We’re always trying to improve the golf course. I submit the projects we’d like to do, what it costs and what the benefits are going to be.”
To be sure, budgeting a golf course on a month-to-month basis is not for the faint of heart.
“It’s always an adventure; never boring,” Andrade says. “There is always something new. The problem is, there are a lot of unknowns each month that we have to fit in somehow. We just do the best we can and try to provide the best playing surface we can.”
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Dave Solga (left), manager of golf operations at Bully Pulpit GC near Medora, N.D., and course superintendent Kyle Fick oversee the high-profile destination venue with a structured budget template developed by Solga. Photos courtesy of Bully Pulpit |
David Solga, CGCS, Bully Pulpit Golf Course, Medora, N.D.
Solga came to the superintendent’s profession a little late in life — early 30s — but he made up a lot of ground in a hurry. Today he’s found his comfort zone in a familiar place, the far western reaches of North Dakota as the golf operations manager at Bully Pulpit Golf Course, a Michael Hurdzan creation near the vacation mecca of Medora.
The move in the summer of 2002 to become construction and grow-in superintendent and eventually take over the head management position of the facility was really a homecoming of sorts for Solga. He had worked in the oil fields around Medora as a young man and had married a girl from nearby Dickinson.
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Bully Pulpit is the showcase of the Theodore Roosevelt Medora Foundation’s myriad holdings to attract vacationers to western North Dakota’s famed Badlands. |
He decided to give golf course work a whirl and, after he got his turf management degree at Penn State in 1985, he returned to his native Minnesota. Early in 1995, as a regional superintendent for Evergreen Alliance Golf Unlimited, he took over an ambitious project near Biwabik, Minn. — Giants Ridge Golf & Ski Resort. About six years later, not long after Solga had won GCSAA’s national resort Environmental Steward Award, he got wind of a golf course to be built out near Medora in the midst of North Dakota’s famed Badlands.
It was no surprise that the recent environmental award winner and Hurdzan, one of the most environmentally conscious designers in the business, got together. Bully Pulpit opened about five years ago as a recreational showpiece among the myriad holdings of the Theodore Roosevelt Medora Foundation.
A couple of valuable assets Solga brought with him from Giants Ridge are the budget templates he helped develop, first for Evergreen Alliance and then during a brief fling with Troon Golf when the latter took over management of Giants Ridge. One template is for the $323,000 golf course maintenance budget and the other is Solga’s blueprint for the entire, nearly $1 million operation.
“It’s a tremendous tool to both create the (maintenance) budget and critique the budget,” says the 19-year GCSAA member. “I’ve never come across one as strong or as valuable.”
Solga works closely with his course superintendent, Kyle Fick, on the maintenance business plan. The zero-based template is in Excel Workbook spreadsheet form and allows Fick to work with specific maintenance plans for each of four primary areas of Bully Pulpit — greens, tees, fairways and roughs. It’s all driven by pre-set maintenance standards, with plenty of room to tweak and adjust.
“As time or the years go by, we hope to be able to fine tune the budget to where it’s pretty rock solid from one year to the next,” says Solga, who has helped other superintendents in the region with versions of the maintenance template.
Actually, the budgeting process at Bully Pulpit is pretty solid now. Solga notes that the foundation management has reviewed and approved the budget as submitted every year they’ve been in operation.
Bully (named for Roosevelt’s favorite exclamation) Pulpit cost about $3.5 million to build and the clubhouse and grounds came to another $900,000. With 15,000 or so rounds per short season (usually six months), one would figure the operation has a long row to hoe. To the contrary, the foundation has garnered gifts and donations through the years and also has $100,000 sponsorships for 14 of the course’s 18 holes. The course debt was paid off this past spring. Solga likes to think his astute budget management had an assist in that.
“The golf operations budget is probably the most detailed process of all the other departments or entities (including entertainment, lodging and other services) they own and operate,” he says. “The ownership respects the superintendents’ professional opinions. They’re very receptive to what we do here.”
Dave Ostert, CGCS, Maquoketa (Iowa) Country Club
Superintendents like Dave Ostert are of a different mettle — longtime course managers at low-budget facilities, many of whom, like Ostert, have never known any other way.
Ostert began his career at Maquoketa CC the day the course opened in the mid-1970s. Within two years he was superintendent at the nine-hole layout nestled in rolling hills 50 miles east of Cedar Rapids and 30 miles west of the Mississippi River. One look at the photos of MCC here should tell you the 28-year GCSAA member has done pretty well with limited resources over the last three decades.
Not unlike a lot of similar facilities that dot the Midwest, budgeting is mostly a laid-back affair at Maquoketa, but crunching the final number and figuring out how to maintain it is serious business.
“The chemicals and such are pretty much set, and I go ahead and do that,” says Ostert, who reports to the club’s board of directors. “But we’re pretty much a day-to-day operation and I do what we need. If it’s something major, I’ll let the club manager or a board member know what’s going on and that they can expect a bill.”
Ostert says he creates an annual budget mainly for his own purposes to keep track of such items as turf products, repairs, shop supplies, course supplies, fuels, labor, utilities, and training and dues. The most recent bottom line for the course was $87,000, or 20 percent of the total annual budget at the club, which includes a clubhouse, pro shop and recently remodeled restaurant and bar. Course labor, which includes Ostert and two part-time staff members, was less than a quarter of the club’s total labor costs.
There is some robbing Peter to pay Paul, but mostly, “We run things pretty tight; there’s not a lot of room. But if we need it, we usually get it,” says Ostert, who adds that new equipment purchases need full board approval.
“The important thing is not to waste money, keep the equipment in good shape and looking good — appearances make good impressions — and always plan ahead,” he says, pointing out that he strives to lock in some prices, such as turf products and fertilizer, if possible, and helps attract the corporate outings and charity events for which Maquoketa has been a popular venue.
MCC also benefits from a number of aces in the hole, as in volunteers from the club membership.
“We have a lot of members who donate a lot of time on jobs like pruning trees, planting and weeding wildflower beds, hand-spraying miscellaneous areas, picking up limbs and even helping aerify and topdress greens,” Ostert says. “We keep labor costs down because we get an extra hand like that and because of employees who take pride in their work like I have at the present time, as well as myself putting in long days seven days a week.”
Make that unlimited resources at Maquoketa CC.