Inver Grove Heights' City Council has signed off on a separation agreement with longtime golf course manager Al McMurchie, part of a larger plan to shore up the financially struggling operation.
McMurchie, who had managed Inver Wood Golf Course since it opened in 1992, declined an interview request. His last day at work was Friday.
In March, the council voted to eliminate the golf course manager's position and not reassign McMurchie to a different job. The move, under which McMurchie's duties are being assigned to other employees on a reorganized golf course staff, saves the city $60,000. City Administrator Joe Lynch said that represents about 3 percent of the golf course operation's annual expense structure.
McMurchie, whose annual salary was $95,900, will receive $30,000 in severance pay, plus pay for accrued but unused vacation time. Under terms of the agreement McMurchie also retains full ownership and rights to five instructional videos that he made on various aspects of the game. The videos have been on Inver Woods' website but will be removed and can't be put back up without McMurchie's permission.
Inver Wood has an 18-hole championship course and nine-hole executive course that sit on 275 acres of rolling, wooded terrain near 70th Street and Hwy. 52. The course was developed during headier times for golf, when participation was on the upswing. Like many courses, Inver Wood has suffered from an ongoing decline in the number of people playing the sport.
The city golf operations recorded 47,821 rounds played in 2013, the lowest recent total since 2008. Poor weather last year was part of the reason for the low number, but even in 2012 — when weather conditions were ideal — the course recorded 52,582 rounds, far less than in the early 2000s.
Inver Woods' problems have been compounded by the way it was financed. The city chose to fund the entire cost of buying the land and developing the course — about $7.6 million — with revenue bonds. Annual debt service payments climbed to about $500,000.
"We were able to cover our normal operating costs sometimes and our capital improvements sometimes but we were not able to cover those and debt service," Lynch said.
Inver Grove Heights had the largest operating loss among 17 metro area municipal golf courses in 2012, according to the most recent report on city finances by the state auditor.
Late last year the city made a transfer of funds to wipe out the accumulated deficit, setting it up as a no-interest loan that needs to be repaid over three years. The city also paid down development debt by selling excess land next to the course to the city's Economic Development Authority for about $1.3 million.
The land is in two parcels: about four acres across 70th Street from the northwest corner of Inver Wood at 70th Street and Babcock Trail, and about 11 acres on the south side of 70th Street west of the golf course parking lot.
Lynch said the EDA intends to sell the parcels, both of which could attract interest from housing developers.
Meanwhile, the city is taking steps it hopes will generate more golf revenue.
Inver Wood doesn't do much tournament business because its clubhouse lacks banquet facilities. "We recognize that's somewhat of a handicap, but we're going to try to attract more," said Eric Carlson, parks and recreation director. The course also has adopted a new rate structure for larger groups, he said.
One thing it won't do is cut its fees, Carlson said. The course tried that about three years ago on the advice of a consultant, but the lower fees didn't draw enough golfers to make up for the lost revenue. "We need to hold our rates and not discount," Carlson said.