OSOYOOS TIMES-September 30, 2009

By Paul Everest - Osoyoos Times

To make up for a cash shortfall for 2009 of roughly $275,000, active members of the Osoyoos Golf and Country Club will have to pay an extra $410 in dues this year.
“On October 1, 2009, each Member who has paid regular playing dues for 2009, will be invoiced an additional $410.00 (plus GST),” reads a message sent to the club’s members on Sept. 18 from club President Fred Meester. “Members who paid retainer dues will be invoiced an additional $110.00 (plus GST). Payment for these invoices will be due and payable by Oct. 31, 2009.
“The Club’s late dues payment policy will apply whereby a 10 per cent penalty will be applied on any outstanding amounts beyond midnight, October 31, 2009.”
The club’s original dues notices for 2009 were issued in December, 2008.
The club has roughly 650 active members and a membership at the club currently costs $7,500.
That was increased to $8,500 in July, 2008, but when the recession hit late last year, the club decided to return to the $7,500 fee.
The cash shortfall is being blamed on the current “global economic crisis.”
Specifically, the club was unable to bring in the revenue it had budgeted for 2009 because of a lack of new members and because fewer tourists came to play at the course this year.
“Our Club depends upon annual membership growth (both for the infusion of cash in membership initiation fees and the net growth in member’s annual dues) and maintaining a significant level of daily green fee revenue,” Meester’s message reads.
Meester told the Osoyoos Times on Sept. 25 that the club’s dues have been kept “artificially low” for the last four years and now “it’s catch-up time.”
“We need this capital in from our members in order to continue to operate as a club,” he said.
The dues adjustment, Meester added, will bring the club “back on side.”
He said the club is more than $4 million in debt— due to the building of a new club house and the expansion of the golf course in 2006 to 36 holes— and it costs a great deal of money to service that debt.
Meester’s message also mentioned a “serious situation that has recently developed between the Club and its Lender.”
The club’s mortgage agreement with its lending bank, the Bank of Montreal, states that it must make a profit or break even each year.
The club’s general manager, Randy LaRoche, said the club lost money in 2008.
Although the club had cash reserves to cover the loss, he said, the loss triggered a default on the club’s mortgage agreement with the bank.
The bank sent a letter to the club informing it of the situation, but promised it would take no action regarding the default as long as the shortfall is corrected.
By the end of August, 2009, the club knew it would have to ask its members to pay more dues to make up for this year’s cash shortfall, LaRoche said.
He added that, for the most part, the club’s members have accepted the current financial situation.
“No one likes to see prices go up,” LaRoche said. “I do think many members are understanding.”
Meester said he’s aware the dues adjustment is causing considerable distress for seniors or those with fixed incomes.
He said he’s hoping the club’s members will realize the club’s rates are still reasonable and have been lower than rates at most other clubs in the Okanagan Valley.
He added that even though the dues have been adjusted upwards, the club’s rates are still competitive.
The dues adjustment was discussed at a club membership meeting at the Desert Park recreation complex on the evening of Sept. 21.
Member Brian Bagnall said the gathering was standing-room only and he heard concerns about the dues adjustment from many people in attendance.
He said he feels the club has been mismanaged recently since it was running on a deficit in 2006, 2007 and 2008 and it isn’t fair that people have to pay for such mistakes in 2009.
Bagnall said he and other members have talked about calling for a forensic audit of the club to see where the money has gone.
He also questioned why the club continued to hand out bonuses to staff in years when deficit financing was taking place.
Meester did confirm that compensation packages for some club staff did include bonuses up until 2008, but no bonuses were given this year.
Bagnall has arranged a members-only meeting scheduled for Oct. 8 at Desert Park to discuss the dues adjustment situation and he has set up a website where members can discuss their concerns.
Members can sign up for the site at www.ogccmembers.ning.com.
Some members have said they will not pay the dues adjustment and want a change in club management, Bagnall said.
“What if 100 members quit?” he said. “Then would a second adjustment be needed to fix the problem?”
Meester said in his message to members that there may be changes to annual dues for 2010 as well but no decision will be made until the club’s budget discussions begin in October.
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