As we’ve elsewhere explained, when IVGID acquired its two golf courses their represented funding source was IVGID’s Recreation Facility Fee (“RFF”). Here we discuss when and how IVGID has maintained, improved and renovated its golf courses, staff’s plans for the future improvements, and where they believe the necessary moneys will come from.

Although the Incline Village Mountain Golf Course was constructed in 1971¹, recall that in 1976 the Incline Village Championship Golf Course was falling into a state of disrepair. Although the Plan concluded that the Mountain course did not require as much renovation work as the Championship course because of its newer age, many tees and bunkers required significant rebuilding due to their serious deterioration (i.e., lack of maintenance). After all, these were two of the reasons given for IVGID’s acquisition of both courses. And that $600,000 from the initial bond issuance (which was serviced and repaid from a doubled RFF) was used, in part, to pay for contemplated improvements/repairs. And after twenty-five (25) years of “everyday wear and compaction, changes in maintenance standards, encroachment of development, growth of vegetation, and course alterations,”² the then Board decided it was time to “ke(ep) up with the standards of many of the top newer courses…The goal of th(e) Plan (wa)s to improve both the architectural and agronomic condition of the (Championship) course.” And massive renovations were suggested.

Maintenance And Repair Expenses: IVGID’s golf operational expenses³, including maintenance and repair⁴, are reported in the District’s Community Services Fund. And given operational revenues have never in IVGID’s history been sufficient to pay for budgeted operational expenses⁵ assigned to the Community Services Championship and Mountain Golf Sub-Funds, respectively, the simple fact-of-the-matter is that the RFF represents the financial shortfall between budgeted revenues and intentional overspending. And given it’s disingenuous to “cherry pick” any particular source of revenue as the source for payment of a specific expenditure, it’s evident golf operational maintenance and repair expenses are funded by the RFF.

Facilities Assessment And Future Needs  Recommendations: At the urging of former IVGID engineer Brad Johnson, in August of 2012 the District commissioned a golf facilities assessment⁶ and master plan with Global Golf Advisors (“GGA”). And in December of that year, the same²⁹ was presented to the IVGID Board and the public. The purpose of the Plan was to “help…IVGID in planning for current and future facilities related to golf situated within the IVGID scope of operations, with a specific focus on the Mountain Golf Course Clubhouse, which (wa)s in considerable need of repair.” Because the Plan recognized that since

“The golf courses at Incline Village (are)…public golf courses operated by a governmental body, (primarily) for its residents, (IVGID) …face(d) a number of important and critical mandates that differ from the single mandate a privately owned and operated public golf course. (That is)…the Golf Courses at Incline Village…must attract a significant amount of outside play (public golfers) in order to sustain the substantial costs associated with maintaining and operating golf courses and to prevent significant upward pressure on IVGID(‘s) Recreation Fees…Thus…in order for the Golf Courses at Incline Village to be economically sustainable…structural and operational change MUST take place, and the courses must compete directly with all of the other golf courses in the local market in order to attract and nurture high yield public rounds of golf.”

With these mandates in mind, the facilities assessment made the following vital recommendations “derived from research and analytics with respect to the competitive market place, historic and future operations, user needs and best industry practices.”

Mountain Course Recommendations: “given the clubhouse…is in considerable need of repair:

1. “Build a new purpose‐built clubhouse: the clubhouse is now 42 years old, is obsolete and is in need of a number of near‐term repairs and maintenance projects…includ(ing) deck replacement and structural upgrades, restroom expansion, siding replacement, HVAC replacement, and a number of smaller maintenance projects;”

2. “Relocate the (current) maintenance facility to the current clubhouse site: the existing maintenance building is inadequate for operations…including meeting…lunch room…and storage…space;”

3. “Improve the practice area;”  

4. “Continue with the (massive) cart path improvement program (then) underway: the cart path system is in need of repair and should be improved in order to enhance the user experience and limit the wear and tear on the cart fleet;”

5. “Lease a new fleet of electric golf carts: the current fleet of gas golf carts is nearing the end of its useful life and presents a…barrier to women and families due to the noise and smell of gas engines;” and,

6. “Execute an Underbrush Remediation Program: certain areas of the course have been allowed to become overgrown and act to limit the playable terrain and…reduce visibility of natural landscape and course features.”

“In order for the Mountain Golf Course to be successful, (the above) deferred capital, most notably the clubhouse, must be addressed and a new clubhouse (be) built.”

Championship Course Recommendations: given it “recently underwent a significant renovation which has considerably enhanced the facilities(, and)…does not appear to (require) substantial deferred capital…if any, and very limited facility improvement requirements:”

“Continue to address drainage and hot spot issues on Course: (because) fairway conditioning on a number of holes is inconsistent…with soggy…and hard areas mixed throughout the same fairway…According to management, the fairways were not sand-capped (n)or sodded when the Course was (last) renovated. Therefore, additional dollars have and must continue to be spent on aggregates to dress fairways and gradually build up a reasonable sand-capping.”

“In order for the Championship Golf Course to be successful, management must adjust pricing and packaging to market conditions, work with…user group golf clubs to improve the salability of peak tee times to tourists and visitors, implement an efficient yield management program, improve overall turf conditions, and moderate expenses.”  

Financing Construction of These Capital Projects: Insofar as adequate funding to address the Mountain Course’s facility recommendations, the enhancement plan estimated $1,735,400 with the understanding “the Mountain Course should be self‐sustaining at a mature level of operations (and)…not be expected to contribute net income to IVGID for other uses.” And insofar as the Championship Course is concerned, “like the Mountain Course, (the enhancement plan estimated it) should be self-sustaining…however…not be expected to contributed net income to IVGID for other uses unless actual results considerably outperform(ed) those contemplated herein.”

Mountain Golf Course Clubhouse & Maintenance Building Replacement Evaluation And Recommendations: Given the existing clubhouse building was originally built in 1970-71, and the existing maintenance building⁷ aka the “Cart Barn”), and neither was code for lateral forces (seismic & wind) due to code changes over the years, in 2014 (and then amended in 2017) nor American With Disabilities Act (“ADA”) compliant, and as a follow up to the above 2012 GGA Facilities Assessment, the District commissioned the subject Mountain Golf Course Clubhouse & Maintenance Building Replacement Recommendations wherein BJG Architecture and Engineering (“BJG”) recommended six (6) renovated/replacement options estimated to cost between $1,620,000-$3,500,000. After a mysterious structure fire occurred in the kitchen of the Mountain Golf Course in April of 2022, substantial renovations were made to the clubhouse in accord with some of BJG’s recommendations.

The Source of New Estimated Capital And Operational Expenses: Given the above enhancement plan found that “the Golf Courses at Incline Village have operated at a loss in every year reviewed and evaluated,” care to guess where the source of revenue for these capital and operational expenses came/will come from? Now you know.

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1. See that 2001 Mountain Golf Master Plan.
2. See that 2001 Championship Golf Master Plan.
3. Governmental financial reporting instructs that operational expenses are associated with revenues the product of exchange transactions (ones where “two parties give up and receive…goods, services, or assets…of similar value”). Since the RFF is not the product of exchange transactions, GASB Statement Nos. 33, 36, and pre-November 30, 1989 Financial Accounting Standard Board (“FASB“) and American Institute of Certified Public Accountants (“AICPA“) pronouncements incorporated through GASB Statement No. 62 instruct they do not represent operational revenue.
4. NRS 318.145 instructs that GID “board(s) shall have the power to…maintain and repair the improvements acquired by the district, including, without limitation…all facilities of the district relating to any basic power which the district is authorized to exercise.”
5. As an example, look at the District’s fiscal year 2019-2024 “Statement(s) of Income, Expenses and Change(s) in Net Position” for the Community Services Championship Golf [see page 594 of the packet of materials prepared by staff in anticipation of the IVGID Board’s May 25, 2023 meeting (“the 5/25/2023 Board packet“)] and Mountain golf (see page 599 of the 5/25/2023 Board packet) Funds. Once one removes the RFF from each of these sub-funds, one sees operational losses for each and every year.
6. NRS 318.100(1) instructs that GID “board(s) may construct or otherwise acquire any improvement appertaining to any such basic power which the district may exercise and may finance the costs…by any of the procedures provided in this chapter.”
7. Actually two nearly equal size buildings; one that was designed and built with the original pro shop in 1970-71, and a substantial addition built in 1979-80.