HomeMy WebLinkAboutCouncil Minutes Golf Budget Meeting - May 12, 2026 (208) 359-3020
35 North 1st East
Rexburg, ID 83440
Rexburg.org | Engage.Rexburg.org
City Council Fiscal Year 2027 Budget Meeting Minutes – May 12, 2026
Mayor Jerry Merrill
Council Members:
Bryanna Johnson David Reeser
Colin Erickson Bill Riggins
Eric Erickson Alisha Tietjen
City Staff:
Spencer Rammell – City Attorney
Matt Nielson – Finance Officer
Keith Davidson – Public Works Director
Alan Parkinson – Planning & Zoning Administrator
Scott Johnson – Economic Development Director
Deborah Lovejoy – City Clerk
2:30 P.M. Fiscal Year 2027 Budget Meeting – Golf
Finance Officer Nielson reviewed the Golf Budget Report.
Legacy Golf Course, focusing on daily fees, club rentals, and the increasingly popular Buddy Pass program. The Buddy Pass has become one of the course's strongest revenue sources, growing
steadily from approximately $64,000 to $76,000 annually over the past several years. Through April of the current year, revenue from Buddy Pass sales totaled about $39,000, which was
slightly below the same point the previous year despite a recent price increase. The Buddy Pass price has risen significantly over time, increasing from roughly $160 when first introduced
to approximately $255 plus taxes and fees today. For budgeting purposes, next year's projection was left at approximately $76,000, pending further sales results.
Revenue at Legacy Golf Course the total revenues grew from approximately $282,000 in 2024 to $350,000 in 2025. City Staff projected that revenues this year would be slightly lower,
at around $338,000, and budgeted a similar amount of approximately $337,000 for next year.
Revenue at Teton Lakes Golf Course, where revenue growth has been much stronger. Finance Officer Nielson highlighted significant increases in daily play revenue, driven largely by a
recent 25% rate increase combined with continued growth in rounds played. Other revenue categories, including driving range income and season passes. Like daily play revenues, range
revenue is projected to increase this year before leveling off slightly in next year's forecast. Season pass sales are identified as a major strength for Teton Lakes. The course has
already generated approximately $259,000 in season pass revenue, with final totals expected to exceed $260,000 by the end of the season.
Senior Pass has generated approximately $63,000 so far and is expected to reach around $69,000 by the end of the season. The Family Pass was also performing strongly, especially considering
that pass prices increased by approximately 25%. Revenues have already reached levels comparable to last year's totals, indicating continued strong demand.
Madison County resident discount program. Residents who can verify residency receive a 20% discount on eligible season passes. The city has already provided approximately $70,000 in
resident discounts, with total discounts projected to reach around $74,000 by year-end. The budget anticipated approximately $25,000 in resident discounts on daily green fees, but no
discounts have been recorded so far.
TagMarshal system, the golf course's cart-tracking and management technology. The line item reflects lease proceeds associated with financing the system. Because of governmental accounting
requirements and GASB reporting standards, the city is required to record the transaction in a specific way, resulting in accounting entries that may appear unusual.
Golf Fund Reserves, the fund began fiscal year 2026 with approximately $627,700 in carryover reserves, a dramatic change from earlier years when the city routinely subsidized golf operations
by hundreds of thousands of dollars. Although the proposed budget will require roughly $233,000 of reserves next year if all planned expenditures are approved, the fund balance is projected
to grow to nearly $800,000 by the end of the current season, meaning reserves are expected to increase despite planned spending.
Legacy Golf Course Operating Expenses has four full-time employees, and their wages and benefits are allocated between the two courses, with 25% assigned to Legacy and 75% assigned
to Teton Lakes. The budget includes a 2.73% cost-of-living adjustment (COLA) for full-time staff. Part-time labor costs at Legacy are projected to be unusually high this year, largely
due to work associated with the irrigation project. Because those costs are expected to be temporary, the proposed budget reduces part-time wage projections for next year.
Clubhouse costs, which remain relatively stable at approximately $17,000 annually. Benefit expenses, however, have increased due to the addition of a new employee and the use of several
part-time employees in PERSI-eligible positions, which allow staff to work just under 30 hours per week while still qualifying for retirement benefits.
Fuel costs have been increased slightly to reflect current pricing and operational needs. Staff noted that fuel expenses also affect the cost of products such as fertilizer, which are
heavily tied to petroleum markets causing costs to fluctuate significantly.
Legacy irrigation is in the final phase of the system project, which is projected to cost approximately $78,000 this year.
Finance Officer Nielson noted that Legacy's expenses are unusually high in 2026, reaching approximately $344,000, primarily because of the final irrigation system investments. With
that project nearing completion, expenses are projected to decline significantly next year to approximately $277,000, which is even lower than some previous years because no major capital
projects are currently planned for the course.
Teton Lakes Golf Course expenses. Because staffing costs are allocated between the two golf courses, 75% of the wages and benefits for the four full-time golf employees are assigned
to Teton Lakes, resulting in approximately $263,000 in full-time wage expenses. Part-time wages for both grounds maintenance and clubhouse operations continue to trend upward. In addition
to staffing changes and increased participation in PERSI-eligible positions, the city is anticipating a substantial increase in health insurance costs due to a particularly expensive
claims year. A potential increase in PERSI retirement contribution rates in next year's budget projections, pending decisions expected from the retirement system later in the year.
Supplies, the course naturally incurs higher supply costs than Legacy because of its size, level of activity, and maintenance requirements. Most supply categories are budgeted with
only modest increases to account for inflation and normal operational growth. Fuel and oil, where included a somewhat larger increase because of uncertainty surrounding future fuel prices.
General liability and property insurance, employee health insurance. Because renewal figures have not yet been finalized, the insurance estimate could still change before the budget
is finalized.
Credit card processing fees, which represent a significant operating expense due to the high volume of electronic transactions submitted at the golf course.
Operating expenses at Teton Lakes, most of the remaining budget categories, consist of smaller, routine expenses that have only received modest increases in inflation and operational
needs. Computer software and maintenance costs are related to the recently implemented TagMarshal system.
Capital equipment plans the budget to include approximately $90,000 next year for a new fairway lawnmower. A rough mower was purchased this year for about $47,000, which fulfilled one
of the major equipment replacement needs. A greens mower replacement, budgeted at approximately $110,000.
Utility vehicle replacement City Staff noted that updated pricing information has been received and that the estimated cost would be approximately $68,000, rather than the $90,000 currently
shown in the budget.
New driving range ball picker included in the budget includes approximately $10,000 for a new driving range ball picker, which will replace aging equipment used to collect golf balls
on the practice range. Tee green renovation project, budgeted at approximately $5,000. City Staff confirmed that work is already underway and that the allocated funding is expected to
be used as planned for improvements to the course. landscape material storage area, budgeted at approximately $30,000. The budget line is labeled as "storage," but the project consists
of constructing a four-stall storage area with six-foot concrete walls to hold landscape and maintenance materials more efficiently.
Teton Lakes parking lot expansion project, which currently includes $100,000 for paving and related improvements. The project will focus on expanding the parking lot near the maintenance
shop area and improving already prepared ground.
Finance Officer Nielson explained that the golf operation has historically transferred money from the operating fund into a separate reserve fund, originally created for debt service
but now used primarily for major capital planning. He noted that transfers have increased steadily over the years, rising from approximately $59,000 in 2024 to $107,000 in 2025, $110,800
in 2026, and a proposed $208,100 next year. The larger transfer is intended to strengthen reserves for future capital projects. He recommended approximately $54,000 be dedicated to equipment-related
obligations, while an additional $154,000 would be set aside specifically to prepare for future irrigation replacement and improvement projects.
Discussion regarding the profitability of each golf course. Legacy Golf Course has consistently generated annual profits of roughly $60,000 to $63,000, although it is expected to post
a small loss this year because of the final phase of the irrigation project. Teton Lakes has experienced more variation, producing profits and other time losses depending on capital
spending levels. This year, Teton Lakes is projected to generate a substantial profit of approximately $198,000. For next year, however, the budget projects a loss of roughly $293,000.
Finance Officer Nielson emphasized that this is largely intentional and reflects the decision to set aside significant funds for future irrigation work and other long-term capital needs
rather than an operational shortfall. Even with those planned reserve contributions and capital investments, the golf fund is expected to remain in a strong financial position. The ending
fund balance would decrease from approximately $820,000 at the end of the current year to around $586,000 by the end of next year.
Finance Officer Nielson reviewed the Golf Debt Service or Capital Reserve 51 Budget Report.
Finance Officer Nielson explained that the fund no longer carries any debt and is being used exclusively to accumulate reserves for major future capital projects. Current projections
show the reserve fund carrying over approximately $369,000 at the end of the current year. This balance is being strengthened through contributions from both the city and county, which
are each contributing $50,000 this year. He proposed increasing those annual contributions to $60,000 each next year, while also continuing transfers from golf operations. Combined with
the golf fund's contribution, the reserve fund would receive approximately $329,000 in new revenue next year.After accounting for ongoing golf cart lease expenses of roughly $54,000,
the reserve fund is projected to end next year with approximately $645,000 in reserves. The reserve balance is projected to exceed $600,000; however, the irrigation replacement remains
one of the largest future liabilities facing the golf operation and that building reserves early will reduce future financial strain.
Adjournment
APPROVED:
________________________________
Jerry Merrill, Mayor
Attest:
________________________________
Marianna Gonzalez, City Deputy Clerk