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Club Capital Planners

11 posts
  1. Dustin Riley
    Dustin Riley avatar
    8 posts
    12/2/2015 8:12 AM
    Good morning,



    An idea has been pitched to our Board of Directors to create a Capital Asset Expenditure Plan for the Club. Essentially, develop a 5-10 year plan for equipment or facility repair needs. The idea involves hiring a service, Club Capital Planners, to conduct a Capital Reserve Study. The study involves an onsite inspection , staff interviews, financial review and the development of a Capital Expenditure and Capital Mgt Plan.



    It is my opinion that each department head should be able to develop a plan for our own areas. However, like most Boards, they like to hear what an outside neutral service has to say and recommend. However, like most Boards, they'll want this info for free. Well, it's a service and not free.



    I have nothing to hide. I'm sure an outside service may have a different view on needs than I do, however, I'm open minded enough to adjust. Hell I might just learn a better and more efficient way. But, that's if this idea goes forward.



    Does anyone have experience with Club Capital Planners or another similar type of service? Please share if so.



    Thanks



  2. Patrick Finlen
    Patrick Finlen avatar
    4 posts
    12/2/2015 11:12 AM
    HI Dustin,

    While we have not used Club Capital Partners, we did do a reserves study in 2008. It was the best thing for us to do as a large club to verify our assets, their value, life span and replacement needs. The final document has been used each year since in making capital replacement decisions. In our case we know we need to set aside a specific amount of money to replace existing capital items before considering anything new or spending money in an area because a board or committee wants to. It places each department on an even playing field. While I was skeptical at first, it is a valuable tool to use in long term planning to avoid knee jerk decisions being made. We most likely will do another study in the next two years to help us plan out to 2025 and beyond.

    Pat Finlen
    The Olympic Club



  3. Keith Fellenstein
    Keith Fellenstein avatar
    0 posts
    12/2/2015 11:12 AM
    It is my opinion that each department head should be able to develop a plan for our own areas.

    Dustin,
    I don't know about your particular situation, but as far as my current and past experiences, most other departments are not run like ours. May not be the case that all department heads are as competent as you believe, and if that is the case, a good exercise? Although I wouldn't want to pay for the service, I would be curious what the results would be at my own club. Keep us posted if you can.



  4. Michael Vogt
    Michael Vogt avatar
    2 posts
    12/2/2015 6:12 PM
    Dustin:

    I work with an asset reserve company in Annapolis, Maryland. In that capacity I work with the golf course superintendents and help them put a value and a timeline on important golf course assets, for instance irrigation systems, cart paths, practice facilities, bridges, retaining walls, equipment, etc.

    You would be surprised how many superintendents get funding for items that have been difficult in the past to even get a sniff for the green committee, board or owners.

    As a superintendent of 30 plus years I always act as an advocate for the course and the superintendent. Please feel free to call if you'd like some ammo for the reserve study, I know of no other asset reserve specialist that have a superintendent on staff to handle the golf side of the study.

    I total agree with Pat, if done with integrity an asset reserve study will be a guide to capital spending and will be helpful in allocating funds for assets as the reach the end of their useful life.

    My very best with the study,
    Mike



  5. Melvin Waldron
    Melvin Waldron avatar
    43 posts
    12/3/2015 8:12 AM
    This is a great topic, something I will try to bring up in future meetings with our operations. We struggle to find funding for many items, equipment foremost, but crumbling cart paths, old buildings, etc..

    Thanks Mike for mentioning a few assets that I really didn't think about when first thinking about this topic.

    Hopefully more discussion will continue on how those that are doing this successfully have been able to achieve results and just going through the nuts and bolts process.

    This could be a great educational program for others.

    Mel

    Melvin H. Waldron III, CGCS, Horton Smith Golf Course, City of Springfield/Greene County MO

  6. Gary Carls
    Gary Carls avatar
    19 posts
    12/3/2015 2:12 PM
    Similar to what others have mentioned this was actually one of the strong points of working for a city that did a 20-year budgeting plan. Each department had to plan for their long-term capital needs within that budget and figure out how everything would get paid for in the 20 year plan. You could shift projects around if they became more or less important and the same went for equipment replacement. All our equipment was in effect "leased" from our Fleet Division and we paid a rental rate on each item as part of our budget. That rate included maintenance and eventual replacement within the given schedule so when it was time to replace something it got done. Worked pretty well most of the time but in more recent years there was definitely a lot of pressure to "defer" replacements an additional year or two. It seems like the planning would be better done in-house than by an outside company because you better understand your needs and facility. While everything might have a designated replacement life it will vary by facility and use so there's no one answer that fits everyone. Even if the planning is done by an outside company it's going to take a lot of your time and input to actually put together a solid plan that works for your facility.

    Gary K. Carls, CGCS, President - Oakland Turfgrass Education Initiative

  7. Steve Nelson
    Steve Nelson avatar
    0 posts
    12/3/2015 4:12 PM
    Never used the company but I guess I wouldn't be suspicious as these types of plans are generally good things as others have mentioned. Working for a city for the last 25 years, this has been SOP, and it has worked well. Everything still gets re-evalutated before putting a replacement piece into a future budget, but that's good too because deferred maintenance is one thing, replacing things that don't need to be replaced is another. Mel I'm surprised your city hasn't been doing this.



  8. Melvin Waldron
    Melvin Waldron avatar
    43 posts
    12/3/2015 5:12 PM
    Steve Nelson, CGCS said: Never used the company but I guess I wouldn't be suspicious as these types of plans are generally good things as others have mentioned. Working for a city for the last 25 years, this has been SOP, and it has worked well. Everything still gets re-evalutated before putting a replacement piece into a future budget, but that's good too because deferred maintenance is one thing, replacing things that don't need to be replaced is another. Mel I'm surprised your city hasn't been doing this.


    I'm not to a degree, although the city might have been doing it, but just at a higher level. I do know since our new city manager has been on board (5-6 years), there has been a renewed emphasis on this, especially in fleet vehicles.

    Parks is starting to get better with this as well. Part of the problem was some mismanagement with pension payments by the city back before the bubble burst, in the fire and police pension plan that the city runs. It was funded at 100% back in the boom years, so city didn't pay into it and went to fund big projects? (all before I got here). They then have since been playing catch-up to the fund. All other pensions and new police and fire go into the state fund which is funded at 85-90%+. I will say they have been very successful when it came to road improvements, where projects are planned out way in advance, and when the sales tax comes up for renewal, they will present the most updated list of projects along with what was "Completed as Promised" and the tax gets renewed no problem.

    Parks had other priorities as well, growing new parks with a sales tax, that was recently defeated, and during the recession the other sales tax that was suppose to pay for upkeep of new parks wasn't enough. Some say we probably grew a little to fast. The department was also trying to wean itself off the subsidy from the city to become self sufficient. Just in the last couple of years have they been able to start improving their fleet.

    Golf is a little different because we're an enterprise fund, so if we have a bad year, something breaks down that is not expected, and other items keeps us from replacing equipment like we should. I do have a 5 year equipment replacement plan we try to follow, until something else breaks down, so except for 3 years ago, we haven't been able to follow it. We brought in a new tractor and greens mower 3 years ago, nothing last year, and a Workman this year to replace a Cushman that the rear end fell apart on. Still waiting to replace that bank mower we have been without for 5 years now.

    Mel

    Melvin H. Waldron III, CGCS, Horton Smith Golf Course, City of Springfield/Greene County MO

  9. Melvin Waldron
    Melvin Waldron avatar
    43 posts
    12/4/2015 2:12 PM
    I did get thinking about this some more. I wonder if we are doing better then I previously thought. We do budget bunker and tee renovations into our operating budget. Since we have few bunkers (14) and renovated 7 of them the last two years, we are now getting back into our plan of doing 1 bunker per year along with leveling and regressing 1 forward tee, 1 regular tee and 1 back tee per season along with regressing 2 collars per year, (until that is we can best figure out to just replace the zoysia with cool season grasses on collars.).

    We also budget in to operating budget, to replace on 1 green per season our Rain Bird 51 impact heads with Eagles, and then use the 51's on tees and fairways replacing broken heads and cases. We also look at replacing 1 to 2 SBM1230 clocks that control greens with retrofit kits.

    So I guess we are taking care of when we can the little things.

    Mel

    Melvin H. Waldron III, CGCS, Horton Smith Golf Course, City of Springfield/Greene County MO

  10. Steve Nelson
    Steve Nelson avatar
    0 posts
    12/7/2015 12:12 PM
    Mel, do you guys have a depreciation reserve fund for rolling stock? I think it would help, but it does impact your operating budget some. Example: we buy a piece of equipment for $30K and assign it a ten year life span. Every year for 10 years $3k goes into the depreciation reserve. So your operating budget gets a $3k annual expense, vs. a one time $30K expense. In theory, we have enough in reserve to replace that piece of equipment on schedule.



  11. Melvin Waldron
    Melvin Waldron avatar
    43 posts
    12/7/2015 4:12 PM
    Steve Nelson, CGCS said: Mel, do you guys have a depreciation reserve fund for rolling stock? I think it would help, but it does impact your operating budget some. Example: we buy a piece of equipment for $30K and assign it a ten year life span. Every year for 10 years $3k goes into the depreciation reserve. So your operating budget gets a $3k annual expense, vs. a one time $30K expense. In theory, we have enough in reserve to replace that piece of equipment on schedule.


    Not that I am aware of. I believe partly (but I'm guessing as there are a couple of layers between us and the finance guy), because we are right now lease purchasing stuff. I know there isn't a line item in our budget for that depreciation reserve fund, My boss remembers a depreciation line item on the newest golf course's budget but it hasn't been there now for a year or two.
    After our budget meeting today, I know that is were my boss wants us to get to, replacing stuff on a schedule, it is just right now we are so far behind.

    Mel

    Melvin H. Waldron III, CGCS, Horton Smith Golf Course, City of Springfield/Greene County MO

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