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How Do Other Municipal-Owned Courses Run Food Service Programs?

With food services at Village Links losing money, what lessons can be learned from other towns?

Part of the $3.9 million Master Plan to renovate and update offerings at the course includes expanding food service operations, despite having lost $156,065 since 2006. Some village leaders suggested privatizing food service operations at the course, but Recreation Director Matt Pekarek does not believe that is the best plan. Pekarek maintains that golfers at the course lose out on enhanced customer service if food is handled by a third party. 

“Focusing on food and beverage profitability is a detriment when you look at the overall picture of golf operations. We’re focused on the customer and providing that service, even if it’s not profitable,” Pekarek told Patch. 

But how do other village-owned courses handle food services? With lines being drawn in the sand over the future of food services at the Village Links of Glen Ellyn, Patch looks at how other villages handle food services at municipal and park district golf courses.

Outsourcing, and Profits in Wilmette

Wilmette Park District wanted the food service sector at its golf course to become an added revenue source, which was not the case before 2007, according to Jeffrey Bowen, superintendent of facilities.

The park district entered into a licensing agreement with Open Kitchens and since then it’s been “unbelievably marvelous,” Bowen said. The Wilmette Park District charges Open Kitchens about $50,000 each year to serve the patrons of the facilities. This agreement is a flat rate, so even if Open Kitchens made $1 in revenue each year, it would still owe the Park District $50,000.

$240,000 for Schaumburg

That’s different from the deal Schaumburg Park District has with Ala Carte Entertainment, a Chicagoland restaurant operator that rents out facilities at the golf course in Schaumburg. Each year the Schaumburg Park District brings in a percentage of income from Chandler’s, the restaurant at the golf course.

And, according to Daniel Otto, Schaumburg Park District's deputy director, the restaurant brought in $240,000 last year for the Park District, which is consistent with years past.

Otto said the park district moved to this option, nearly 10 years ago, because during the off-season they would have to lay off staff. But once the season revved back up during the summer months, they would need to bring staffers back, which became problematic.

Now when things get slow at the Schaumburg Park District restaurant Otto said the food service vendor is able to reassign waiters to its other locations. The food service provider is also able to buy food in large quantities or purchase alcohol specials from distributors, which wasn’t possible for the park district.

Profits from In-House Operations in Wheaton

But there are some golf courses owned by municipalities or park districts that still operate food and beverage service. The Wheaton Park District operates , which raked in $1,122,326 in operating profit last year.

The restaurant has increased profit nearly year every since 2007, except in the fiscal year that ended Dec. 31, 2008 when the restaurant operated at a $213,315 loss.   

This upward trend in revenue comes after a 2004, $16 million project that substantially improved the clubhouse, allowing for more seating inside and outside on a patio, in addition to a larger bar for patrons.

Mike Benard, executive director of Wheaton Park District, said contracting out the food service is not an option due to the success of the current strategy.

“We fulfilled the intent of the design. It’s not by chance it’s by choice,” Benard said.

However, the Wheaton Park District does contract with food vendors. In September the Wheaton Park District Board of Commissioners approved  $398,197 in bids for some food vendors for the restaurant at Arrowhead. Commissioners only approved bids for vendors who offered fixed pricing rather than those who offered commodity-based pricing.

Losses Bring Changes in Lisle

Like Glen Ellyn, Lisle has seen similar losses in food revenue. According to records provided by the Park District, the facility has cost the district more than $600,000 since 2008. Earlier this year the Park District revamped food services at River Bend Golf Club and unveiled Wheatstack—A Midwestern Eatery & Tap, replacing the View Restaurant, which failed to generate enough revenue to cover expenses since it opened in 2003.

The Lisle Park District paid for the construction with the issuance of an alternative revenue bond in 2002 for just over $2.65 million. To maintain service on the debt, the View needed to generate a little more than $200,000 annually, a feat it did not accomplish. Parks manager Dan Garvy said he believes the new restaurant can be a success.

"It’s an investment and we know we have been criticized for spending money on a facility that loses money,” . “But it’s not a gamble, we are very confident in the new concept.”

Food Services Costs at River Bend Golf Club

Year Revenue Expenses Difference 2009 $1,141,911.55 $1,291,596.79 -$149,685.24 2010 $1,109,213.63 $1,258,880.69 -$149,667.06 2011 $895,742.85 $1,032,120.62 -$136,377.77

Although food service does not provide a profitable revenue stream for Village Links of Glen Ellyn, upgrading the restaurant golf course is part of the $3.9 million renovation plan crafted by the village recreation department. The plan is currently under review by National Golf Foundation, which should yield a report to the village board in December. 

Critics of the Village Links plan say it neglects to explore all options to improve the restaurant and ultimately to curb the loss of revenue.

Even though the master plan includes improvements to the clubhouse, former recreation commissioner Brad Rosley, thinks more could be done. Rosley from his position as commissioner in November 2010; one reason was because of the disregard for exploring the option to privatize the entire food service operation at the golf course. Rosley thinks the current master plan misses the objective.  

“The plans would make for a better golf course experience. I just don’t believe the revenue projections, don’t think they have demonstrated how to run a food service operation successfully, and are not increasing the use of the facility for other residents,” said Rosley.

, for the third installment in this series on Village Links of Glen Ellyn. Village leaders consider the future of the course, will privatizing the food service operation be on the table?

Here's the first Patch report, where we take a look at the food service division: .

 

Thomas November 22, 2011 at 08:17 PM
Why is the government owning any restaurants?

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