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15 THE CITY OF pLEA NTONo CITY COUNCIL AGENDA REPORT April 21, 2015 Operations Services TITLE: APPROVE GOLF COURSE OPERATOR EXTENSION AND AMENDMENT OF AGREEMENT WITH PLEASANTON GOLF, LLC (CourseCo) SUMMARY The five-year Operator Agreement with Pleasanton Golf, LLC (CourseCo) is scheduled to end on June 30, 2015. Staff representatives from the City Attorney's Office, Finance, and Operations Services departments have been discussing with Pleasanton Golf, LLC (CourseCo) management for the past seven (7) months an extension and amendment to the Agreement now being considered by the Council (Attachment 1). It addresses a term extension of five years, payment practices and minor language clean up to the agreement. The proposed extension and amendment to the Agreement with Pleasanton Golf, LLC (CourseCo) is for a period of five (5) years. Under this Agreement, Pleasanton Golf, LLC (CourseCo) would not have an ownership interest in the golf course, but merely manages the maintenance and operations of Callippe Preserve for the City. Expenses would be passed through for reimbursement by the City from golf course revenues. Pleasanton Golf, LLC (CourseCo) would receive the noted "fixed" fee each year of the agreement, with any "incentive" fee payments tied to meeting aggressive revenue goals, including green fees, cart rentals, driving range, merchandise, lessons, and food and beverage. PARKS AND RECREATION COMMISSION RECOMMENDATION That the City Council approve the extension and amendment to the Operator Agreement with Pleasanton Golf, LLC for management of Callippe Preserve Golf Course. RECOMMENDATION Approve the extension and amendment to the Operator Agreement with Pleasanton Golf, LLC for management of Callippe Preserve Golf Course. FINANCIAL STATEMENT In the first year, the combined fixed/incentive fee cannot exceed $204,000 which is the same as the FY 2014/15 contract fee. The combined management fee (fixed and incentive) increases consistent with Consumer Price Index (CPI) on July 1, 2016 and July 1st of each subsequent contract year thereafter. The City will utilize revenues generated from golf course operations to pay for all operating costs, with any excess funds going towards internal service funds for capital projects and repair and maintenance projects.