ENCINITAS — At Wednesday night’s meeting, the City Council voted to form a subcommittee to address questions raised over the Encinitas Ranch Golf Course.
The Encinitas Ranch Golf Authority (ERGA) governs the 18-hole course.
ERGA is an independent board that was established by the city and developer Carltas Company nearly 20 years ago.
Councilman Tony Kranz, who proposed creating the subcommittee, said he recognizes that the City Council doesn’t have a direct say over ERGA’s board, but oversight is still necessary.
“Our agreement with Carltas was, I think, intended to leave the council and politics out of it,” Kranz said. “And I recognize there’s some good rationale for doing that. But by the same token, as we’ve heard somebody mention tonight, this council will be held accountable for decisions that are made.”
He added that the subcommittee will help the City Council “answer the questions that were posed here tonight.”
Dick Stern, representing homeowners as president of the Encinitas Ranch Community Association, brought up concerns about ERGA’s transparency and financial practices.
He said ERGA didn’t seek enough bids when awarding a 10-year contract to JC Resorts to manage the course.
He added that JC Resorts is paid higher than the industry standard. There isn’t data to support that decision, he maintained.
“I like JC Resorts,” Stern said. “I think they do a great job. But one has to question a couple things about the contract.”
Encinitas Ranch homeowners who live near the golf course also complained that property taxes increased as a result of an ERGA decision two years ago.
This occurred, they said, because ERGA created a new, ill-advised contingency fund.
In effect, that meant allocating less money to CFD (community facility district) bond payments, passing on the CFD debt to 924 Encinitas Ranch homeowners.
And that triggered an increase in property taxes, the homeowners said.
John McNair, vice president of JC Resorts, said that the course upgrades were “much needed.” They were developed in response to survey information submitted by golfers who played the course, he said.
According to the staff report, the course has been profitable and self-sustaining since inception.
In 2011, 53,844 rounds were played on the golf course, and 55,441 in 2012. This year is on pace to have 56,778 golf rounds.
Deputy Mayor Lisa Shaffer and Kranz were assigned to the subcommittee.
They didn’t announce concrete dates for the subcommittee meetings or settle on a timeframe for reporting back to the City Council.
Although questions have been raised, Shaffer said, “no one is proposing closing the golf course.”
“The issue on the table is — are we managing the assets in our public-private partnership effectively?” Shaffer asked.
Mayor Teresa Barth said the development agreement between the city and Carltas Company is due to expire in 2014.
It’s a good time for the city to learn what the end of the agreement could mean, she said.
Councilwoman Kristin Gaspar recused herself from the topic, citing a potential conflict of interest because she lives near the golf course.