Villa Monterey refers to a golf course project in which the City of Scottsdale asked the Arizona Golf Foundation to assist in refurbishing and managing the course in 1998. The then golf course owners had recently purchased the Scottsdale Culinary Institute and turned the clubhouse, cart barn and maintenance area into a school. The City of Scottsdale wanted to keep the golf course in tact, and requested that AGF keep it alive until a commercial parcel could be identified to house a clubhouse, which would make the course financially viable.
Villa Monterey was donated to the AGF at the behest of the City of Scottsdale. The key element in the Foundation’s decision to accept the challenge was the City’s commitment to create a commercial site outside the Indian Bend wash at the south end of Chaparral Park on which we could build a new clubhouse and connect it by a tunnel to the Villa Monterey Golf Course. However, although $700,000 was appropriated in the City budget to build a tunnel under Chaparral Rd., the City chose not to construct it. The City of Scottsdale had changed its direction as to the use of critical commercial property that would have allowed for a clubhouse and the construction of important infrastructure. This change in direction eliminated the long-term viability of the project.
The Arizona Golf Foundation continued to work with the City of Scottsdale in an attempt to implement the necessary changes to the course and find an alternative spot on the property that could be zoned to build the clubhouse. This was a long and complex process which continued through 2003.
During that time the AGF operated the property, and served thousands of youth and senior golfers in Scottsdale. The AGF created and subsidized a child friendly golf facility where parents were welcome to bring their children to enjoy a round of golf for a reasonable price. It contributed funds throughout the process, assisted with a $40,000 grant from the City as the AGF showed continuing interest in making the course succeed. AGF implemented junior programs aimed at not only teaching kids how to play, but also about respecting the golf course and the game. We were proud to have Villa Monterey become the host site for the Special Olympics as well as a regular venue to facilitate charitable golf marathons.
With the decision by Scottsdale not to implement the underlying conditions for the creation of a clubhouse site, it was determined that the operation of Villa Monterey was simply not feasible. The AGF subsequently sold the property in 2004.
Rancho Sahuarita Golf Course
The Rancho Sahuarita project was one developer’s vision that was never completed because it did not work within the policy framework of either the Town of Sahuarita or that of Pima County. A finance authority necessary to deliver the tax exempt financing for the project could not be established or accessed, in part, because the local jurisdictions did not support the construction of a significant water user and had concerns about the size of the development surrounding the prospective course. The AGA and the developer spent a considerable amount of time attempting to secure private financing, but were unsuccessful because there was no history of operational performance in that area for the “new build” course that was proposed. The Project never proceeded beyond the design process.
This situation is exactly the opposite of the proposed revitalization of Papago Golf Course in which there is a history of operations that has been recognized by our lender Wells Fargo enabling the AGA to obtain financing for the Papago project.
Project Financing – IDA Funding
It has been suggested that there may be a problem of a legal nature regarding the AGA and its 501(c)(3) affiliate (the Arizona Golf Foundation, AGF) having the legal authority and power to finance the acquisition, improvement and equipping of capital projects related to the refurbishment of Papago Golf Course. Pursuant to A.R.S. Section 35-701, et. seq., and Section 145 of the Internal Revenue Code of 1986, as amended we can indeed move forward to obtain financing through the Phoenix Industrial Development Authority. The project falls within the parameters of what can be approved by the Phoenix IDA.
Wells Fargo is the financial partner committed to the Papago Golf Course redevelopment project. We are very optimistic that we can complete the financing for this project in a timely manner. In fact, a Vice President for Wells Fargo was present at the RFP presentation to the City to confirm its interest. To argue that financing is an issue is simply not supported by the facts.
The AGA also has a second potential lender for the project. Johnson Bank has expressed an interest in funding the restoration. The preferred vehicle is the IDA, taking advantage of tax exempt funding.
Phase II Building Proposal
As part of our proposal to the City, we included a Phase II of the Papago Golf Course revitalization, which included office expansion – a building that would provide office space for our amateur association partners, thus allowing each to monitor and coordinate their programs at Papago Golf Course. We would also provide office space for the City of Phoenix golf staff.
Phase II would not begin until the fifth year of operation. It is anticipated that rent will be negotiated regarding AGA space as well as for other Strategic Partners. The expansion is also projected to provide space to exhibit the Arizona Golf Hall of Fame, to expand the restaurant facilities to accommodate large events including weddings and workshops and to create meeting rooms for corporate groups as well as the Papago Men’s and Women’s Associations.