“Papago Golf Course, Phoenix in limbo” plus 1 more

Posted: 10 Jan 2011 04:31 PM PST

by Lynh Bui and Connie Cone Sexton - Jan. 9, 2011 12:00 AM
The Arizona Republic

When it opened nearly 50 years ago, Papago Golf Course was considered a jewel amid the red rocks of east Phoenix, its design a challenge for professionals but enjoyable for amateur duffers.

At its peak, golfers lined up to play more than 100,000 rounds a year.

Profile: Papago Golf Course | Papago Park

It was a course destined to remain a top draw for local and visiting golfers, city officials believed.

But the course deteriorated after the 1990s. The Phoenix Parks and Recreation Department, which oversees municipal golf courses, said major renovation was needed on the lakes, tees, greens and bunkers. Trees were dying, and the existing clubhouse needed to be replaced.

In 2007, the city had a plan. With no money to inject, Phoenix sought an outside course manager. From three proposals, Phoenix selected the non-profit Arizona Golf Foundation to restore the course to its original luster and run day-to-day operations. The foundation secured $12.5 million in financing through the Phoenix Industrial Development Authority, which issued bonds to renovate the course.

After pumping $10 million into Papago, the foundation filed for bankruptcy in October. Bankruptcy proceedings for the non-profit management arm of the Arizona Golf Association are expected to continue through February.

In the meantime, city officials are in limbo, waiting to hear from a judge if they can fire the foundation and hire a new company to run the course.

City officials insist no taxpayer dollars are in jeopardy despite the foundation's bankruptcy. Deputy Parks and Recreation Director Rob Harman has said that Compass Bank, which bought $9.5 million of the tax-free bonds, only has a right to golf revenue from Papago and cannot seize the property or its assets.

But that doesn't mean the city hasn't spent taxpayer money to take care of Papago since the bankruptcy filing.

The Parks and Recreation Department spent at least $100,000 to water and seed the course in 2009 and 2010.

"The payments were a bridge to enable the course to prepare for and stay open until the peak winter season arrived," city spokesman David Urbinato said.

Rick Naimark, the Phoenix deputy city manager who oversees the Parks and Recreation Department, said the city is disappointed to be at this juncture with the Arizona Golf Association.

He said the city has an investment in Papago and is eager to move on following the bankruptcy.

Ed Gowan, executive director of the Arizona Golf Association, said he couldn't comment until legal proceedings are complete. Gowan said the foundation's attorney, Jack Hebert, is the only spokesman for the foundation. Hebert did not return calls and e-mails requesting comment.

Foundation officials from the beginning, however, have blamed the poor economy for troubles at Papago. They also have said they want to keep managing the golf course and have come up with a plan to do it.

"We have the financial resources at our disposal now to give us a great shot of performing all the responsibilities we're supposed to perform," Hebert said during a December bankruptcy hearing.

Three bidders

On Jan. 12, 2007, Phoenix issued a request for proposals to outsource the management and restoration of Papago, located between Van Buren Street and McDowell Road, off 52nd Street, near the Phoenix-Tempe border. The work included restoration of the irrigation system, turf, driving range, restaurant and clubhouse. The goal of the partnership was to "return this facility to its status as a premier municipal golf course destination, while maintaining the integrity of the design concepts of the original architect," the request says.

Three bidders emerged as the top contenders: Lyon Golf, Papago Golf LLC and the Arizona Golf Association.

- Lyon Golf: Partnered with high-end real-estate company Lyon Realty, Lyon Golf runs the ASU Karsten Golf Course at Arizona State University in Tempe. According to its proposal, Lyon Golf had planned to work with noted golf architect Forrest Richardson to restore the Papago course. Richardson had been deeply involved in the city's prior efforts to restore Papago. Lyon also had some of the original plans from the course's designer, the famed William Bell of the family that designed Torrey Pines in San Diego.

Lyon Golf proposed investing about $12.2 million in the project, offering the cash up front from the Lyon family trust. Lyon had the most ambitious revenue projections of the three finalists, estimating a renovated Papago would make $4.9 million in 2008-09, growing to $6.7 million in 2011-12. Lyon also proposed some of the highest greens fees, $30 to $147 a round. It asked to run the course for 25 years.

- Papago Golf LLC: A partnership between Jim Bellows and Landscapes Unlimited. Bellows' company runs Rolling Hills Golf Course, a Tempe municipal facility in Papago Park, also home to the Papago course. Landscapes Unlimited did restoration at Torrey Pines for the 2008 U.S. Open. Papago Golf proposed spending about $6.4 million on the project, offering $4.4 million up-front cash. It proposed the most modest rates, $11 to $40 a round. The company also had the most modest revenue projections, estimating the course would generate $1.8 million in its first full year, growing to $3.3 million in 2011-12.

Randy Spenla, a city auditor who served on the selection committee, said the proposal didn't include enough funding for maintenance. He said the proposal to run the course under a 40-year lease was too long.

- Arizona Golf Association: The Arizona Golf Association's proposal fell in between the other bidders. The association's management experience was limited. It had managed Villa Monterey public golf course in Scottsdale, which shuttered after the association couldn't afford to operate it. Scottsdale had to spend at least $82,000 to maintain the nine-hole course. It eventually was closed and became an eyesore until the city turned it into a park in 2006. For its Phoenix proposal, the association called on the Golf Guys, a team that includes Marvin French, to manage Papago. French helped develop and design Pumpkin Ridge Golf Club in Oregon. The association proposed funding $200,000 in cash to start renovation at Papago, then planned to rely on loans from the city's Industrial Development Authority.

The association estimated Papago would make $4.5 million in 2008-09, with revenue growing to $4.9 million in 2011-12. The AGA created a separate non-profit to operate Papago for 25 years.

Arizona Golf Association won the bid.

Surprise selection

Mike Conner, a general partner in Lyon Golf, said many were surprised when Phoenix selected the Arizona Golf Association and its foundation as the winning bidder, considering the Villa Monterey failure in Scottsdale.

Conner also said he was surprised that a proposal using public bonds won over Lyon Golf's plans to fund the project through private money from the Lyon family.

"It's hard to lose a deal when you're totally at risk, the city has no risk, and you still lose," Conner said.

Spenla, the city auditor, said the three proposals were similar and none would have provided a windfall to the city.

The association's plan was attractive, he said, because of the development-authority bonds. "That made their cost of borrowing the same as the city," Spenla said.

Another positive for the association was its presentation. "Each firm had a 90-minute or two-hour interview and there is a subjective element of who did the best job in the interview," Spenla said. "AGA did that."

Some wondered, however, whether the association had a foot in the door that gave it unfair advantage over other companies. The association's Gowan sat on the city's golf-advisory committee and had access to city discussions on what to do with Papago.

Joe Hume, a founder of Save Our Papago, a group formed specifically to keep the association from running the course, closely followed the course improvements. He raised questions about the ability of the foundation to deliver its promises, but his questions have fallen on deaf ears.

"Why wouldn't you do business with the people who have the money and the expertise?" Hume said.

Unkept promises

In April 2008, Papago shut down for eight months as the $9.75 million overhaul began. The foundation replaced turf, expanded the driving range and replaced the irrigation system.

But there were some promises that weren't kept.

The foundation didn't complete re-vegetation throughout the course or make its rent payments to the city.

But the biggest disappointment was the failure to build a clubhouse after razing the existing one. The clubhouse is in a trailer until a permanent structure can be built.

Hume said he and others are disappointed with the renovation, which destroyed more than 250 of the course's iconic palm and eucalyptus trees and functional clubhouse. He said a core group of golfers who supported Papago even when the course was falling apart have stopped playing.

The foundation had support from several high-profile organizations, including the Arizona Women's Golf Association, the Junior Golf Association of Arizona and the United States Golf Association. A year after the renovation, Golfweek named Papago one of the top 50 municipal courses in the nation.

Bellows said it would be hard to find a replacement to manage the course.

"The sad part is they missed a big opportunity, because now the industry is totally different than it was three years ago," Bellows said. "The lenders aren't out there. Equity isn't out there."

Greg Stanton was the councilman who represented the district that includes Papago when the decision was made to go with the foundation. He said the city wanted to restore the golf course to its "former grandeur" without using money from the general fund, which pays for core city functions such as police and fire services.

The foundation wasn't successful because the economy took a dive, Stanton said, and fewer people were spending time and money playing golf.

"There were some folks who felt AGF was the very best and others didn't," Stanton said. "Anytime you have a competitive RFP process, you'll get strong sides on both issues."

The Golf Guys is still running Papago during the bankruptcy proceedings.

Regardless of what happens, Naimark, the deputy city manager, said he was determined to see a clubhouse built.

Where the funding will come from isn't known.

Naimark won't join those who question the choice of the foundation, but said, "We didn't achieve what we set out to achieve."

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Golf captain's £40,000 benefit con

Posted: 11 Jan 2011 11:49 AM PST

Published on Tue Jan 11 20:02:26 GMT 2011

A former golf club captain from Cheshire who swindled thousands of pounds in benefits has avoided jail.

Valerie Lewis, 55, from Runcorn, claimed she suffered back pain which made it "virtually impossible" for her to walk unaided outdoors.

But surveillance footage taken by fraud investigators captured Lewis at her golf club - teeing off, playing the fairways and pulling her golf bag without any apparent difficulty. She has been sentenced to 24 weeks in jail, suspended for two years, at Warrington Crown Court after pleading guilty to dishonestly claiming benefit totalling £40,842.

Charlotte Atherton, for the prosecution, said Lewis made her initial claim for Disability Living Allowance (DLA) in March 2001. On the application form, the defendant said back pain made it difficult for her to walk, dress and wash herself or prepare food without "severe discomfort". Lewis also claimed she needed help getting into and out of bed, the barrister said. The mother-of-two then saw a doctor for assessment and claimed she was unable to walk more than 140 yards without having to go bed for the rest of the day.

The court accepted that Lewis had initially suffered a medical problem with her back but "very soon" after making the DLA claim she was playing golf up to three or four times a week, walking up to five miles across the fairways at Sutton Hall Golf Club near her Cheshire home. Miss Atherton said: "During the course of her claim, she was playing golf very frequently and, in 2001, was riding horses at her local stables. She was, of course, awarded DLA on the basis that she could walk no more than 140 yards."

Golf club records and Lewis's own diaries, which were seized by benefit fraud investigators, showed she even played a round of golf the day after her doctor's assessment, Miss Atherton said. In 2003, the defendant reapplied for DLA and received increased payments after maintaining that walking outdoors was "virtually impossible", Miss Atherton said.

It was during her captaincy year at Sutton Hall, where she paid membership fees of £600 a year, that the Department for Work and Pensions received a tip-off that Lewis was "fitter than stated" and not entitled to the benefits she received. A covert surveillance operation was launched which captured the defendant on camera on the fairways and removing her golf clubs from her car. Lewis, who has two previous convictions for shoplifting dating back to 1994/95, was arrested the following year and, although she admitted playing golf, she denied fraud.

David Ackerley, defending, said the fraud arose because Lewis "misunderstood" the meaning of the DLA application forms. "She was advised to recount the worst case scenario on the forms and that is what she did," he said. "But that scenario was not the case every day."

The barrister asked for leniency from Judge Stephen Clarke, telling the court that Lewis's husband had suffered three strokes, her mother is blind and her father has terminal cancer. She was needed at home to look after her family, he said. He also said Lewis is paying back the money at a rate of £10 a week, deducted from her incapacity benefit.

Judge Clarke suspended the 24-week prison term for two years "as a measure of sympathy", he said. He also ordered Lewis to carry out 200 hours of unpaid work. He said: "This case brings shame and disgrace on you. When people read about it in the local paper they will think you are a hypocrite. Those who cheat the system not only cheat the taxpayer but also legitimate claimants as there is not unlimited funds."

Golf Zone

Tuesday, January 11, 2011