The battle for Winnipeg's munis

Interesting to see the notion of privatizing Winnipeg’s munis has gone down in flames amidst finger pointing at the union that employs the workers at the facilities. The Winnipeg Freeps picks up the story:

The City of Winnipeg’s largest union is trying to take control of city hall, deputy mayor Russ Wyatt charged as a plan to lease four city-owned golf courses died Wednesday.

A divided council voted 8-7 to reject a deal that would have seen Ontario’s GolfNorth Properties maintain and operate links at Kildonan Park, Crescent Park, Harbour View and Windsor Park for 20 years.Although the defeat was expected, an angry Wyatt lashed out at the Canadian Union of Public Employees Local 500, claiming the union controls the votes of six members of council and will attempt to seize a majority in 2014 when Winnipeggers next go to the polls.

The Transcona councillor said his colleagues should be more concerned with taxpayers who support money-losing golf courses than they are with the union that provides support on election day. For the past 15 days, he’s maintained the cost of unionized labour has hamstrung the city’s 12 golf courses, citing a 2011 city audit that also identified dramatically declining golf rounds as a factor in annual losses at the city’s Golf Services special operating agency.

Winnipeg had sought to have Ontario’s Golf North take over the courses and even run an advertising campaign trying to get support for the notion. ‘

The union that represents workers at the courses, CUPE, came out swinging against allegations the courses lose money (source):

While in 2011 WGS direct revenues exceeded direct expenses by $107,000, the transfers back to the city create the illusion golf courses are in the red.

While other years have seen ups-and-downs in revenues and expenses, they are hardly the shocking numbers pushed by the mayor.

The current bidder for the lease of our golf courses, GolfNorth, vows to inject roughly $4 million into capital repairs (over 20 years, about $50,000 annually).

Since 1995, however, golfers contributed a $1-per-round course-improvement levy to help keep the facilities up to par.

But in 2003, when the city created the SOA, this course improvement fund was raided and transferred to general revenues.

Had the city maintained the course improvement fund and invested it into the golf courses as intended, the value would be well over $3.6 million. The city proposal would also allow the company to set its own green fees, increasing the cost of golf and making it a less affordable activity for many Winnipeggers.

In the end it looks like Winnipeg may sell the land where one of its courses resides, but otherwise it is status quo. The city looks like it lost and the union and golfers look like they’ve won.

I’m not sure it is that simple. The truth is that unionized fees at courses for work that is largely staffed by unskilled labor kills plenty of munis. City courses should be low-cost, no frills offerings that allow people to enter the game. High labor costs have made them a target for those who feel the city shouldn’t be in the golf business. But couldn’t the same be said for, say, arenas? When was the last time an arena made money for a city?

The truth is that the battle over most munis isn’t a fight over whether a city should run golf or not. Nope. It is a fight between unionized labor that runs up costs disproportionate to private operations and city officials who are trying to rein in unions and spending. Winnipeg isn’t alone — Kingston, Thunder Bay, Kitchener, London and Windsor have all faced issues with their munis in recent years.

This isn’t a problem that’s going away — expect to see more stories like the fight over Winnipeg’s courses capture headlines in the years to come.

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Robert Thompson

A bestselling author and award-winning columnist, Robert Thompson has been writing about business and sports, and particularly golf, for almost two decades. His reporting and commentary on golf has appeared in Golf Magazine, the Globe and Mail, T&L Golf and many other media outlets. Currently Robert is a columnist with Global Golf Post, golf analyst for Global News and Shaw Communications, and Senior Writer to ScoreGolf. The Going for the Green blog was launched in 2004.

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