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5) What has been the 'real' cost of operating Pinewood (outside of interest and <br /> principle)? What portion of these expenses are long-term purchases (i.e. new golf <br /> carts)? <br /> Principal,interest,and capital improvements/equipment replacement are the"real'cost of operating <br /> Pinewood Golf Course. <br /> The operational subsidy per year,excluding P&i,are cited below. Before Pinewood could open in <br /> 2006, the course needed carts and a mower. An equipment lease was subsidized with General Fund <br /> monies. The course needed new maintenance equipment in 2013 and was projected for 2014 in <br /> order to sustain operations. The course was not projected to earn enough revenue to cover <br /> operational costs and fund the new equipment. <br /> YEAR Operate GF Lease ERF TOTAL <br /> 2006 (85,761) (28,969) - 114,730 <br /> 2007 (89,364) (34,634) - 123,998 <br /> 2008 (81,190) (36,049) - 117,239 <br /> 2009 (24,902) (36,050) - 60,952 <br /> 2010 (45,398) (8,496) - 53,894 <br /> 2011 (48,301) (8,496) - 56,797 <br /> 2012 (46,578) - 46,578 <br /> 2013 (47,027) (27,764) 74,791 <br /> 2014 Budget (60,100) (18,200) 78,300 <br /> 6) How do the expenses for the last two years of the golf course compare to the total <br /> expenses of the course? <br /> The taxpayer subsidy for the past two years is similar to previous years with the exception that we <br /> have postponed planned equipment replacement,which would have increased the annualized losses. <br /> Incidentally,2012 had an early start following a tepid winter and was our longest season and still <br /> required a similar subsidy to operate. <br /> 7) Who initiated the process to not make the final balloon payment? <br /> City staff identified scenarios that potentially would provide leverage to renegotiate the final <br /> payment. The city attorney and real estate attorney representing the city on the final closing <br /> researched the legalities. The information was provided to the Council for their direction. The <br /> decision to propose to the Krauses an amendment to the Contract for Deed was made by the entire <br /> City Council. As discussed previously,even though the Council decided to propose an amendment <br /> to the Contract for Deed, the Krauses immediately commenced suit without further negotiation or <br /> discussion. There has never been a decision of the Council not to complete the Contract for Deed. <br /> 176706v2 <br />