Three months after giving a preliminary report to the county board on its evaluation of Superior National at Lutsen Golf Course (SNGC), consultant John Waite of Sirius Golf Advisors presented to the board a written business plan with recommendations on where to take the course from here.
The plan recommends that Superior National—which is owned by the Cook County/Grand Marais Economic Development Authority (EDA)—become a 36-hole “resort-caliber” course in three phases, the first costing up to $3.3 million. “It is our strongest desire to start construction next year.” Landowners adjacent to the course have not expressed opposition to the possibility of their land becoming part of the course at this point. The entire renovation as recommended would be about $7 million.
The business plan states, “…Neither the EDA nor the county has committeed to any of the renovation proposals put forth by Sirius. However, both parties have given strong indications that they wish to renovate the facility….
“…We feel the best option for sustained success for SNGC, and to maximize economic impact to the area, would be to become a 36-hole resort. This would make SNGC and Cook County a golf destination as opposed to simply being a location with a resort-quality golf course. The difference is significant.
“…In short, a 36-hole resort course has a better chance of success in an isolated area such as Cook County. Further, it is likely to have a far greater economic impact on the area.”
Only three commissioners were at this meeting—Sue Hakes, Fritz Sobanja, and Bruce Martinson. Commissioner Sobanja said he was not looking to Sirius to recommend upgrading the course that much. Waite pointed out that the board had planned to spend $1.8 million of the county’s 1 Percent Recreation and Infrastructure Sales Tax on golf course upgrades. Waite said he envisioned finding numerous sources of funding, including grants, to pay for the upgrades, but he suggested that the board consider spending $3.3 million of the 1 percent revenue on Phase 1.
They had not talked about spending $3.3 million of the 1 percent on the golf course, Commissioner Hakes said. “What I see is us as the only skin in the game, and that’s not going to work for me.”
If the intent of the 1 percent is to “provide for the future of the county” and maximize its investment, Waite said, this is the only project slated for the 1 percent that would do that. “We’re talking about millions of dollars a year in terms of economic benefit to this county,” Waite said.
He said he believed the Iron Range Resource and Rehabilitation Board (IRRRB) would be likely to help with funding if they saw the investment Cook County had in the golf course and would not require anything further from the county beyond $3.3 million.
Commissioner Hakes pointed out that the cost of additional land and any wetland mitigation was not part of the projected project cost. Waite’s recommendation was “not what we talked about,” she said. “It’s too risky.”
Commissioner Sobanja addressed one of those potential risks. “The season is short,” he said. “There might be some economic red flags there.” Businesses in the area that would benefit from an upgrade in the course should invest in the project, he said. The people of Cook County would like to see some private sector buy-in.
Without intervention, Waite said, the golf course will eventually need to be subsidized in order to continue operating. Spending only $1.8 million would not make a significant difference, Waite said. Making it the best course it can be, on the other hand, would bring the county the biggest return on its investment, he said. “We’re talking about something that will have a national impact on the county. That’s why we’re excited. That’s why we’re here. …Everyone we know in the golf industry is saying this is a world-class site with an average golf course.”
Commissioner Sobanja told Waite that plans had already been made for most of the $20 million the 1 percent tax is authorized to bring in. Waite countered, saying that he has heard that not all of the 1 percent had been earmarked. They had hoped to wait and see, said Sobanja, on some of the potential requests and needs for the 1 percent.
They would probably need to consider making the proposed community center smaller in order to have more 1 percent revenue to allocate to the golf course, Commissioner Martinson said.
“This isn’t what we talked about,” Commissioner Hakes said. “We’re willing to commit some 1 percent funding. Now you need to find some more money somewhere.” She would not be changing her position on this, she said.
Superior National General Manager Bob Fenwick said, “We need that to go forward and obviously, without county support for that plan, we can’t move forward.”
Who will walk the board through whatever upgrade process it goes through is still unknown. The business proposal states, “This plan is designed to work as a ‘blueprint for success’ regardless of who is managing the facility. …The EDA has hired Sirius Golf to act as a consultant. In that role, we will be advocating for implementation of this business plan until a permanent management solution is found.
“It is also important to note the Sirius has submitted a proposal to the EDA to become the third party management company. However, if the EDA rejects our proposal, we will be working with them to find a long-term management solution.”
The business plan made many other suggestions, including things like increasing marketing and tying Superior National to Giants Ridge and The Wilderness in a regional “golf trail” to attract people from outside the area.
Revenue projections show annual profits of $969,054 to $2,157,026 from 2012 to 2016, barring major natural disasters or prolonged economic downturned.
The board will discuss the business plan at a special meeting on November 14.
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