Web Version of SM Town Hall

SAVE MULLIGANS
The following is a compressed
presentation of the research presented
on May 1st from the slides prepared by
Deanna Kaufman, Ray Wheeler and Julie
Holbrook. This shortened version
presents most of the main points.
Additional slides have been added.
SAVE MULLIGANS - OVERVIEW
Purchased to Preserve Open Space 2004
◦ Park Impact Fees & Land Sale Used to Purchase
◦ Revenue Bond – Paid From Mulligans Revenues
Most Used Park – 250,000 annually
Mulligan’s is Not Subsidized
Save Mulligans for Future Generations
Use GAAP (Generally Accepted
Accounting Practices) for City Numbers –
Currently Not Used
History of Mulligan’s
4/6/2004 - Resolution R 2004-09 changed zoning of Mulligan's from
Recreation-Open Space to Low-Density to get South Valley Sewer
to back off from pursuit of the land for a sewage processing plant.
(PDF p. 226)
4/28/2004 – South Jordan City City Council Budget Workshop
Meeting, p. 1. The meeting set up the purchase price for Mulligans at
$10.4MM although resolution from city approved bonding up to
$12.5MM
(PDF p. 247)
6/22/2004 – City Council Meeting, pp. 2-3. At the time Mulligans
had a net profit of approximately $500,000 after salaries, property
taxes, etc.
(PDF pp. 257-8)
Unless otherwise noted, all citations in this document are from a PDF file named
“MulligansHistoryResearchBook” provided by the City of South Jordan on their website
Buying Mulligan’s
6/22/2004 - Board Member Marlor made a motion to approve the sale
of the 40 acre city property to John Gust and Kem Gardner for $5.5
million, plus engineering fees. Board Member Winger seconded the
motion. The vote was unanimous in favor. (PDF p. 258)
6/22/2004 – City Council Meeting, p. 3. Mulligans appraised at
$11.6MM, sold for $10.5MM plus notes on property which total
$10.8MM.
(PDF p. 258)
3/1/2005 – City Council Meeting, p. 10. Mayor Money said that
“most” of the money from the sale of the property to the north of
Mulligans to Kem Gardner, et. al. would be used to pay down the
debt on the facility to get the revenue stream to the point it pays
the bond.The sale price of that property is listed as $3.3MM. It was
agreed at this meeting to sell that property.
(PDF p. 262)
Buying Mulligan’s
3/1/2005 – City Council Meeting, p. 11. City Manager Horst said
that Mulligans debt was being paid 100% by the participants that
use the facility.
(PDF p. 263)
8/30/2005 – Special City Council Meeting, p. 2. City Manager Horst
said that “we are reducing our debt service by half. From 900,000
to 450,000. The intent of this was to make sure Mulligans stands on
its own.” City Manager Horst said that worst case scenario “park
impact fees to pay it.” [debt service]
(PDF p. 280)
Buying Mulligan’s
8/30/2005 – Special City Council Meeting, p. 3. City Manager Horst
said we pay $230K per year and the $3MM came from the sale of
the land to the north now known as Riverwalk. He said we also
used some of the money to pay off the old elementary school.
(PDF p. 281)
12/18/2007 – City Council Meeting, p. 4. It was noted that revenue
from the city’s recreation center is paying for all but $250,000 of its
expenditures. City Manager Horst said Mulligans is self sustaining;
they used money from park impact fees but they used no tax
dollars.
(PDF p. 283)
Park Impact Fees
During the first four years, $4,000,000 of park impact fees were used
toward front loaded principal payments. Mulligans paid and continues
to pay approximately $450,000 per year toward the bond.
(PDF p. 1)
(Note: Park Impact Fees are explicitly used for additional demand and need for
Public Facilities related to Park, Recreation,Trails and Open Space as a result of
development activity to maintain levels of service in the affected area. According
to the Office of the Property Rights Ombudsman, Utah Department of
Commerce, http://propertyrights.utah.gov/impact-fees/ impact fees assessed for
one (e.g. parks) purpose must be used for that purpose.
Preserving Open Space
4/6/2004 – City Council Meeting, pp. 5-6. City Manager Horst said
“they are looking at this project is to use the revenues to purchase
Mulligans, and preserve the green belt.”
(PDF pp. 238-9)
4/6/2004 – City Council Meeting, p. 10. Mayor Money said he
“wants to keep Mulligans as recreation/open space. He said this
proposal, as well as the revenues generated by Mulligans, would give
them a source to buy Mulligans.”
(PDF pp. 243)
4/27/2004 – Planning Commission Meeting, p. 9. Chairman Mabey
noted that the Planning Commission recommended that the
property remain as open space.
(PDF p. 367)
Preserving Open Space
5/18/2004 – City Council Meeting, p. 12. Mayor Money says that
“they need to put a conservation easement on the Mulligans
property so it remains open space. Council Member Colton said by
doing this, they are preserving more green space and keeping the
property values higher in the area. Mayor Money concurred.”
(PDF p. 255)
6/22/2004 – City Council Meeting, p. 2. – “Mayor Money said the
sale of the 40 acres was important to have the means to purchase
the Mulligans golf course. He said they are preserving open space.”
(PDF p. 257)
Preserving Open Space
9/21/2004 – City Council Meeting, p. 8 (p. 380) – City Manager
Horst showed the City Council some preliminary drawings of the
Village at Riverwalk. He said the developer will give the wetlands
area back to the City. He said the developer will put in the
improvements and deed the property back to the City.
(PDF p. 380)
8/16/2005 – City Council Meeting, p. 10. – City Manager Horst
when questioned about why the city owns Mulligans said “they
purchased it to maintain open space; it is paying for itself. The City
Council would never have bought Mulligans if it required taxpayers
to buy it.”
(PDF p. 275)
Preserving Open Space
8/16/2005 – City Council Meeting, p. 12. –
◦ Council Member Gayheart said she feels “the purchase of Mulligans is justified,
and they preserved green space.”
◦ Mayor Money discussed the purchase of Mulligans and said “the land would have
been developed. He said that property is the gateway to the City; it provides
open space and a tremendous recreation benefit.”
(PDF p. 277)
8/14/2007 – Letter from Ricky A. Horst City Manager South Jordan
City to John Gust, Arbor Gardner; acceptance of gifts of Real
Property 13.648 acres. Ricky Horst writes, “we assure you your
contribution will be used for the health, safety and general welfare
of the public not only for today but for generations to come.”
(PDF p. 408)
Preserving Open Space
6/3/2008 – City Council Work Meeting, p 4. Council Member Taylor
said the city purchased the golf course to preserve the open feel
next to the river; they do not want to have a large overpowering
building.
(PDF p. 445)
What is a revenue bond?
revenue bond
A revenue bond is a special type of municipal bond
distinguished by its guarantee of repayment solely
from revenues generated by a specified revenuegenerating entity associated with the purpose of the
bonds, rather than from a tax.
Source: Wikipedia definition of “revenue bond,” April 30, 2014.
2004: $12,500,000 Lease Revenue
Bond – Mulligan’s
Purchase of Mulligan’s ($10,460,000 plus
assumed debts, total = $10,900,000)
Uses of Funds
Construction Fund
$10,906,458.07
Debt Service Reserve Fund
886,800.00
Reimbursement Fund
367,491.93
Costs of Issuance(1)
339,250.00
Total Uses of Funds
$12,500,000.00
____________________
(1)
Includes underwriter’s discount, letter of credit fees, legal fees, trustee fees, rating
agency fees, financial advisor fees and other miscellaneous costs of issuance.
Source: $12,500,000 Municipal Building Authority of the City of South Jordan, Utah,
Adjustable Rate Lease Revenue Bonds, Series 2004, p. 19.
2005: $9,505,000 Lease Revenue Refunding
(Refinance) Bond – Mulligan’s
Refinancing of Mulligan’s initial bond after
payment of $4,000,000 in Park Impact Fees to
pay down principal
Uses of Funds
Refunding of the Refunded Bonds
$9,549,972
Debt Service Reserve Fund
724,024
Costs of Issuance(1)
327,418
Total Uses of Funds
$10,601,414
____________________
(1)
Includes underwriter’s discount, bond insurance premium, legal fees, trustee fees,
rating agency fees, financial advisor fees and other miscellaneous costs of issuance.
Source: $9,505,000 Municipal Building Authority of the City of South Jordan, Utah, Lease
Revenue Refunding Bonds, Series 2005, p. 15.
2011: $6,880,000 Lease Revenue Refunding
(Refinance) Bond – Museum/Rec Center
Refinancing of initial Museum/Rec Center Bond
Uses of Funds
Deposit to Escrow Account
Costs of Issuance(1)
Total Uses of Funds
$6,838,782.43
135,931.82
$6,974,714.25
____________________
(1)
Includes underwriter’s discount, legal fees, trustee fees, escrow account fees, rating
agency fees, financial advisor fees and other miscellaneous costs of issuance.
Source: $6,880,000 Municipal Building Authority of the City of South Jordan, Utah, Lease
Revenue Refunding Bonds, Series 2011 p. 11.
Bonds by the Numbers
Museum/Rec Center
Initial Bond Amount
Park Impact Fee
Payment
Refinanced Bond
Amount
Special Principal
Payments (from
property sale to Arbor
Gardner)
Current Principal
Annual Payments
(Principal and Interest)
Mulligan’s
$9,390,000
$12,500,000
--
($4,000,000)
$6,880,000
$9,505,000
--
($3,000,000)
$6,220,000
$4,880,000
$444,426 (FY14)
$450K-$452K (FY14-FY29)
$720K-$730K (FY15-FY24)
How are these bonds paid for?
Source: City of South Jordan 2013 Comprehensive Annual Financial Report, p. 27.
Mulligan’s “Enterprise Fund” covers its own operating costs
and net revenue contributes to pay the bond.
$378,639 toward bond payment of $450K
- Short $72K -
Source: City of South Jordan 2013 Comprehensive Annual Financial Report, p. 39.
With 250,000 annual customers, additional revenue can
easily be generated to meet the entire bond payment
obligation..
Source: City of South Jordan Fiscal Year 2013-2014 Annual Budget , p. 115.
Mulligan’s covers its own operating costs unlike
other properties or programs in the system.
(p. 79)
Parks, Recreation,Trails and Open Space
Master Plan*
City of South Jordan, February 2007
A brief note about the age of the survey
If questioned about the validity of the survey included in the Parks,
Recreation,Trails and Open Space Master Plan document because
this is 2014 and the survey was done in 2006, our recommendation is
to cite that according to the South Jordan (city) QuickFacts from the U.S.
Census Bureau:
Living in same house 1 year & over, percent, 2008-2012 in South
Jordan: 83.2%
Source: U. S. Census Bureau, American Community Survey, 5-Year Estimates.
Updated every year. http://factfinder2.census.gov
Talking point: the residential base in South Jordan is very stable and in
excess of 80%of respondents to this survey may in fact still reside in
South Jordan. The results are likely to be similar given the stability of
the residential base.
What is Area 6? What is District 1?
POLITICAL
There are no apples to apples when comparing political districts to areas defined in the
master parks plan. For purposes of Level of Service, the Parks Master Plan uses Area 6
for the area including Mulligan’s.
DISTRICT 2
(Newton)
DISTRICT 3
(Shelton)
DISTRICT 1
(Seethaler)
DISTRICT 5
(Rogers)
DISTRICT 4 (Barnes)
PARKS
MASTER PLAN
Source: South Jordan City Website
Source: South Jordan Parks, Recreation,Trails and Open Space Master Plan, February 2007, p. 171.
The east side of South Jordan and
specifically Area 6 lack adequate parks and
open space.
Area 6
The only existing parks in this area have a community and regional
focus. Currently, Mulligan’s Golf Course, the Jordan River Trail head
and the Gale History Center are the only facilities, City Owned or
otherwise, that provide service to the residents of this area. In
addition to the eventual development of Aunt Mame’s Place as a
historical site, this area will require the development of two more
parks to achieve a level of service (LOS) coverage that is equitable to
the rest of South Jordan City.
(p. 89)
Talking point: Area 6 has insufficient parks and recreation facilities as
compared to other parts of South Jordan.The city, if it were to sell
Mulligan’s for development, would deprive our area of parks and open
space. Given the high level of development, the city would not be able
to establish the additional parks necessary or replace the land lost by
selling Mulligan’s.
90% of survey respondents indicated proximity to
home is the primary reason a facility is used.
(p. 129)
Mulligan’s was the most visited park in the system
in the prior 12 months when residents were
surveyed.
(p. 126)
Add it Up
South Jordan City District 1
District 2 District 3 District 4 District 5 Total
Parks
(Seethaler) (Newton) (Shelton) (Barnes) (Rogers) Acreage
Developed Active
50.55
16.81
3.93
22.18
0.00
93.47
Developed Passive
68.43
12.94
24.57
36.36
19.87 162.17
Total Parks
118.98
29.75
28.50
58.54
19.87 255.64
South Jordan City
Owned Other
District 1
District 2 District 3 District 4 District 5 Total
Open Space
(Seethaler) (Newton) (Shelton) (Barnes) (Rogers) Acreage
Undeveloped
14.32
13.43
0.00
4.81
20.42
52.98
Natural Open Space
0.00
0.00
7.46
51.77
0.00
59.23
Streetscape
6.19
4.09
1.75
6.51
9.62
28.16
Public Facilities
2.61
0.00
0.00
0.00
0.00
2.61
Cemetery
11.14
0.00
0.00
0.00
0.00
11.14
Golf Course
64.71
0.00
0.00
0.00
0.00
64.71
Total Other
98.97
17.52
9.21
63.09
30.04 218.83
Daybreak
Park
(completed/sited)
Park (TBD)
Open Space
(planned)
Total Daybreak
GRAND TOTAL
District 1
(Seethaler)
District 2
(Newton)
District 3 District 4 District 5 Total
(Shelton) (Barnes) (Rogers) Acreage
0.00
0.00
0.00
0.00
191.00
9.00
0.00
0.00
0.00
0.00
191.00
9.00
0.00
0.00
0.00
0.00
1,000.00
1,200.00
0.00
0.00
0.00 1,000.00
0.00 1,200.00
217.95
47.27
1,237.71
121.63
49.91 1,674.47
200 acres of parks and open space
are required in Daybreak by
agreement, and is part of a required
25% open space requirement (up to
1,200 acres) for the whole
development of 4,126 acres.
Daybreak Fast Facts:
•
•
•
•
•
4,126 acres
Close to half of the land
mass of the City of South
Jordan
13,500 homes at
complete build out
Open space requirement:
up to 1,200 acres
Design philosophy:
• sustainable
development,
• water conservation,
• dedicated open
space, and
• walkable
communities
Source: South Jordan Parks,
Recreation,Trails and Open Space
Master Plan, February 2007, p. 23.
Source: South Jordan City Parks and Open Space, March 2014,
Don Tingey, Director of Community Services, handout copy
p. 6.
Record back to back revenue years FY12/FY13.
In 2013, Mulligan’s had 250,000 customers.
Source: City of South Jordan Fiscal Year 2013-2014 Annual Budget , p. 115.
The City of South Jordan provides many “subsidized”
services that “compete” with the private sector.
City of South Jordan
Services
South Jordan Businesses Providing Similar Services
Leisure,Aquatic and
Fitness Center
Lifetime Fitness, Gold’s Gym, Curves, SoJo Crossfit
Gymnastics
Black Diamond Gymnastics, Twistars Tumbling, Tumblekats
Karate
United Studios of Self Defense, Master Kwon World Class
Tae Kwon Do
Soccer Programs,
Soccer Complex
(proposed)
Soccer City (Sandy)
Youth Dance
Utah Dance Artists, Empower Dance, Academy of Ballet Arts
Utah
Source: Google search of businesses with similar service names in South Jordan, conducted April 11, 2014
Talking point: the argument that the public sector should not provide
what the private sector can is fundamentally at opposition to the many
services that the city does provide. Golf is by no means the only public
service competing with the private sector.
Mulligan’s covers its own operating costs
unlike other properties or programs in the
system.
Revenues and Expenses – Enterprise Fund
Mulligan’s operates as an enterprise fund and all revenues go towards
maintenance, operations and improvements. The table below shows
operating revenues and expenses for 2005/06.
(p. 79)
Talking point: while the city may portray itself as subsidizing a
commercial entity, Mulligan’s was set up with its own enterprise fund to
cover maintenance, operations and improvements. Cost recovery of
these items exceeds 100%.
Hale Center Theatre
We Love HCT!
NOT on Mulligan’s!
There are other locations in SoJo for it!
Heavily Subsidized – free land 10+ acres
Better up by FrontRunner Station
Traffic
Public Comment:
$300,000 of taxpayer dollars
6 workshops, 258 people
150 focus group participants
Online survey, 880 respondents
Dozens of stakeholder meetings
3,000 items of public comment
A Corporate
Business Plan
Green Corridor:
57%
“MixedUse”: 6 %
Ratio: 9.5 to 1
“Preserve as natural
area”: 66%
“Provide More
Shopping”: 2 %
Ratio:
33 to 1
Rhetoric:
Blueprint Jordan River Report, Dec 2008
Recommendations, page 57:
“1. Preserve current open space. Within the
proposed Jordan River Natural Corridor, there are
approximately 7,300 acres of undeveloped land. Of
this land, nearly 3,800 acres is slated for
development. As much open space as
possible should be conserved by
ensuring that the land designated as open space
remains that way, and that land slated for
development is protected.
Develop Some – Lose It All
None of the [SL County] council members could
remember the county being asked to participate in a
CDA, or any other kind of redevelopment area, that
crossed into the riverfront open space identified as
valuable in Blueprint Jordan River.
That 2008 plan is intended to "promote understanding
of the importance of the corridor/parkway, recognizing
it as a regional environmental, recreational, educational
and economic amenity."
But if a project does come up — a couple of references
were made to South Jordan’s discussion of developing
what is now Mulligans Golf Course at 10600 South —
Jensen said the policy’s goal is to encourage cities not to
change the zoning of land now designated as open space
along the river.
Worst
Practice
SAVE MULLIGANS
IN SUMMARY
$673,580+
427,735 =
$1,101,315
Assets Beyond Mulligan’s?
10/15/1998 – The purchase of the Palmer property included 25
shares in the South Jordan Irrigation Canal.
Source: Real Estate Sale and Purchase Agreement, October 15, 1998, p. 5, paragraph 8.
(PDF p. 84)
6/22/2004 – City Council Meeting, p. 2. City Manager Horst said
that “there are also 65 water shares that come with the sale.”
(PDF p. 257)
Unclaimed Water Share Income
City has 5,689 water shares
Mulligans has 90 shares
If all water shares are equal each share is
$3,333 per year
$3,333 X 90 shares = $299,970.00/year
$299,970 X 10 years = $2,999,700 in
water share income
Nearly $3M in unclaimed income for
Mulligans
Additional Assets
Land – Appreciates in Value
◦ Appraised at $19,195,000 March 30,2011
Buildings
Golf Equipment
Maintenance Equipment
A Balance Sheet Would Show These
Assets & Include the Water Shares
Golf – Impact on our State
Study indicates golf an economic force in
Utah, Gov. to declare ‘Utah Golf Month’ –
Fox 13 News- May 4, 2014
SALT LAKE CITY — A recent study is claiming annual
rounds of golf here in Utah were found to match with
annual skier days and that Utah’s golf economy is
greater than all Utah professional sports
combined. (Emphasis added.)
Now, Governor Gary Herbert is scheduled to
declare May the official golf month of Utah.
Bill Walker, executive director Utah Golf
Association, said the sport has wide appeal.
The study, carried out by the Stanford Research
Institute, found golf contributes more than $800
million to our state economy, supports more
than 9,600 jobs, and accounts for more than
$11 million in annual charitable giving.
“There is not a state in the country that has a
larger percentage of their golf courses that are
open to the public,” Terry said.
The study also looked at the environmental impact
and found that Utah’s golf courses consume less
than 1 percent of diverted water.
2014 Park Priorities, Objectives & Actions
PARK
WORK
COST
Welby Park
Phase 1 Design
$240,000.00
Bolton Park
Playground Replacement
$40,000.00
Glenmoor Park
Improvements - Phase ll
$125,000.00
Stonehaven Park
Improvements
$75,000.00
Softball Fields
Pavillion - renovations
$150,000.00
Softball Fields
Resod the fields
$300,000.00
10200 S 4800 W
Inclusive Playground
$150,000.00
10200 S 4800 W
Pickleball Courts
$150,000.00
Heritage Park
Replace Ice Rink & Stage
$350,000.00
TOTAL
$1,580,000.00
MULLIGAN’S HISTORY
Purchased to Preserve Open Space
◦ We Want to be Good Stewards of the Land
Protect it for Future Generations’ Benefit
Open Space by the Jordan River Cannot Be Replicated!
Once This Area is Destroyed – It Won’t Come Back
Most Used Park – 250,000 People Can’t All Be Wrong!
Mulligan’s has NOT been funded by taxes and is
NOT Losing $20,000,000!
Taxes will NOT be Raised if Mulligan’s is Saved!
The Future of Mulligan’s?
Call to Action!
We ask that the City Council let South Jordan
residents determine the fate of Mulligans.
Remember, working together, we CAN make a
difference.
Call your neighbors and friends and share this
information with them.
Put a “Save Mulligans” sign in your yard or in a
visible location (with permission).
Donate to the cause. We are a Political Issue
Committee, so we can now take donations.
Use Facebook,YouTube, Twitter, and other media
to promote the message about saving Mulligan’s.