Memorial Golf Course Who's Keeping Score?

During the recent strategic planning sessions at town hall a new scoping sheet arrived highlighting a request for capital funding assistance from the town, to replace the irrigation system for the Memorial Golf Course. The society that manages the course has provided a cost estimate of $848,000 and proposes to contribute $450,000 from their existing irrigation capital reserve leaving a funding shortfall of $398,000.

The society proposed the following 2 options ;

1)Town partnership contribution wherein the town contribute $398,000.

2)Loan from the Town wherein the town provide a loan of $398,000 with repayment commencing in 2038 with payments of $40,000 per year

The society also requested a modification to their lease to increase the amount permitted to be held in their reserves, which currently limits the amount to $225,000.

The town staff recommendation to council included;

1) Confirmation that the society is responsible for the capital replacement costs under the terms of their lease.

2)Further, while the town has in the past permitted inter-fund borrowing from the town's water utility to facilitate capital replacement, such an approach is not recommended. The annual contributions to the Towns Water Infrastructure Reserve are currently insufficient to support the level of replacement required to sustain the Town's water infrastructure over the long term. As a result, required water infrastructure renewals have been deferred to future years. As such, borrowing from this reserve is not considered practical nor in alignment with best practices.

3)Similarly, the town's Asset Replacement Reserve is underfunded relative to its identified infrastructure renewal needs. Available reserve balances are not sufficient to address the ongoing replacement and maintenance requirements of town facilities, drainage systems, heavy duty equipment (including fleet vehicles) and transportation infrastructure.

Staff also provided several alternatives for the society to consider to raise the funds required.

Kudos to staff for highlighting again that the towns reserves are insufficient to meet current replacement needs. Fortunately council denied the request for funding.

The town releases very limited information about the arrangements in place for Memorial Golf Course and I wasn't able to find a single mention of its existence in town's 125 page Annual Report. That might be understandable if the arrangement is solely a tenant / landlord arrangement where the town has a market rate lease and the tenant has no requirement to provide a specific service or benefit to the residents.

However in this case the town is also a long term funder of the society contributing directly to the cost of buildings and improvements. The most recent example of this "lending" was in Feb 7 2024 when the town agreed to fund the new bridge at a cost of approximately $700,000 with $350,000 paid by QB taxpayers (out of accumulated surplus) and the remaining 50% to be borrowed from the town's Water Utility Reserve, ( Yes, this is the same reserve that staff now says does not have sufficient funds to fund town needed repairs) .

I have been told by town staff that this loan transaction for the bridge has not yet been papered even though the bridge was installed in spring 2024.

You may recall that the town also fronted the funds for the new clubhouse and a shed building. A review of the lease (2008) and modification done in 2022, confirms $1,350,000 is to be repaid at a rate of $50,000 per year over the period of 2008 to 2035, and then the shed building loan in 2022 ,of which $650,000 to be repaid at $35,000 per year from 2023 to 2037).

It is important to note that it appears there is no expectation of interest on any of these additional payments and further appears that the additional payments are considered additional rent rather than loan repayment. The lease has considerable ambiguity around when these additional payments are required, waived and forgiven relative to the balance in the society's combined capital reserve accounts. I am not sure how the town envisioned repayment of $650,000 at a rate of $35,000 a year without a defined start date. I am assuming April 30 2023 the first April 30 after signing the lease modification, to the end of the lease term ( 2037) which would require 15 payments of $43,333 not $35,000 in order to retire the obligation within the term of the lease. I also do not understand how the golf course society can accumulate $450,000 in reserves when the current lease terms cap the combined reserves at $225,000 and any excess surplus is to be paid to the town as additional rent payment made annually.

The leases are the only documents I reviewed to date and many questions remain unanswered. At minimum, I would have expected an entry or note on the town's audited financial statements for 2024 to reflect the $350,000 debt relating to the golf course bridge with funds taken from the Town's Water Reserve fund.

Equally important, the historic model of funding Memorial Golf Course is not sustainable and the current lease constraints disincentivizes the organization from achieving self sufficiency which leads in part, to the ongoing requests for funding from the town taxpayers. Clearly the first source of funding should be from their membership dues and green fees

The Golf Club and the town need to work together to find a way forward to achieve a viable non profit funding model that allows the society to maintain the course and buildings on an ongoing basis from self generated cashflows.

However before this can happen the town needs to clarify and define their relationship with the Golf Course Society whose members pay dues and membership initiation fees. Clearly it is more than a landlord/ tenant lease arrangement. If it is a management contract, then the document should be structured as such with clearly documented expectations of both parties. When, and if, the town grants a loan to any organization it should be documented as a loan and attract interest at a rate at least equal to what the town pays on its borrowed funds.

On many occasions I have heard our Mayor and others say that Memorial Golf Course returns more money to the town than the taxes paid to the town from the two other golf courses operating within the town. I would suggest that property taxes paid (or not paid in the case of Memorial Golf Course) is a poor proxy for return on investment of town assets. It appears QB taxpayers contribute outright and "lend" without interest to cover ongoing capital expenses in this venture. Consider that in 2008 when the initial clubhouse loan of $1,350,000 was made, the municipal finance authority interest rate was 4.35%. resulting in interest cost of $57,375. in the first year alone. The repayment arrangement made with the Golf Course Society would not have even covered the appropriate interest costs had interest even been considered.

Clearly the public deserves far more transparency in how our taxpayer monies are being spent. Hopefully the town will seek to resolve the underlying financial challenge at Memorial Golf Course. A long term, well reasoned and sustainable business plan is also critical as they now go on to find an operator for the newly acquired Eaglecrest Golf Course. Further steps should be taken to ensure QB residents who are funding both these golf courses, get preferential access to membership.

Marie Noel

December 22 2025

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