Laserfiche WebLink
City of San Leandro <br />City Council <br />Meeting Date: December 19, 2022 <br />Agenda Number: 10.k. <br />Agenda Section: CONSENT CALENDAR <br />File Number: 22-687 <br />File Type: Staff Report <br />Adopt a Resolution to Approve an Appropriation of $134,049.82 from the Shoreline Enterprise Golf <br />Course Fund (596) and Authorize the City Manager to Approve a $250,399.82 Disbursement for <br />American Golf Corporation’s Fiscal Year 2022 Incentive Management Fee for the Management of <br />Monarch Bay Golf Club <br />COUNCIL PRIORITY <br />·Community & Business Development <br />SUMMARY AND RECOMMENDATIONS <br />American Golf Corporation (AGC) successfully completed the second year (July 1, 2021 to June <br />30, 2022) of management of Monarch Bay Golf Club for the City of San Leandro (City). The City’s <br />agreement with AGC states the City shall pay AGC 20% of the amount by which net operating <br />income for a given operating year exceeds $750,000. Staff recommends that the City Council <br />adopt a resolution to approve an appropriation of $134,049.82 from the Shoreline Enterprise Golf <br />Course Fund (596) unrestricted fund balance, and to approve a $250,399.82 payment for AGC’s <br />Fiscal Year 2022 Incentive Management Fee for the management of Monarch Bay Golf Club. <br />BACKGROUND <br />On November 15, 1997, the City entered into a Lease Agreement with AGC for the operation and <br />maintenance of Monarch Bay Golf Club, which includes the 9-hole, par 30, Marina golf course, the <br />18-hole, par 71, Tony Lema golf course, the Everett Rooney driving range and the 9,000 square <br />foot clubhouse. <br />The general terms of the 1997 Lease Agreement were: <br />·20-year term with two 5-year extensions, if mutually agreed to; <br />·Creation of a Golf Capital Improvement Project account; <br />·Minimum rent of $750,000.00 annually, or 75% of the average total annual rent paid for the <br />previous three years, whichever is greater; and <br />·Escalating percentage rent from years 1-10, with the highest rate of 30% on golf revenues <br />and 6% on clubhouse revenues. <br />With the City’s intention to sell a portion of the 9-hole golf course to Cal Coast as part of the <br />proposed Shoreline Development Project, this action opened the Lease Agreement between the <br />City and AGC. Subsequently, on June 1, 2020 the , City approved a Management Agreement with <br />AGC. The Management Agreement replaced the Lease Agreement. <br />Page 1 City of San Leandro Printed on 12/14/2022