Yes, golf is not what it was twenty years ago, and the Sacramento market is an especially competitive one in which part- time volunteer management is no longer appropriate. However. RMCC’s circumstance is uniquely complicated. For any country club, labor is by far the largest cost, but for RMCC it is 25% more than industry average, most of that overage in the benefits package. This is because RMCC is saddled with a defined benefit pension plan the union management of which has permitted its promises to far outrun its assets. Not only is this a constant drag, but it precludes other needed spending, and it renders the club unsaleable, since no buyer is willing to take on that obligation.
Although it would be far less expensive to sub- contract course maintenance to an outside firm, this option is foreclosed for it would trigger the ruinous pension plan withdrawal fee, which amounts to millions of dollars. Dissolution of the club also triggers the fee which is what torpedoed the Bellagio deal.
So, what to do? The current RMCC board says it has a plan which probably involves Ch. 11 bankruptcy. Bankruptcy is one of the great inventions of the law. In Ch. 11 cases it makes possible the continued success of otherwise doomed enterprises. For proof of this, one need look no further than the airlines industry, which several years ago underwent a wave of major Ch. 11s and is now thriving. The problems there were similar to those here.
This plan is opposed by a slate of eight challengers. They are accomplished citizens with good standing in the community. Their interest in the welfare of the club is proof of RMCC’s vitality However, they are late comers. Only one has ever served on the board, and only one on a committee. And this they regard as virtue.
Of course, being new is not a disqualifier, especially if there is a plan, or at least a good set of ideas. However, the slates recent letter to the RVT does not contain these. Rather, it calls for a “fresh look”, for “transparency”, for a “careful review of the financials”, for better marketing and more involvement by RMA and CSD. Well, yeaah. Every member of RMCC can support that platform, INCLUDING every member of the current board. In other words, there is no difference between the Slate of Eight and the current board, EXCEPT, the latter has studied the situation, while the former is still planning a careful look at the financials, and the board has developed a plan to escape the club’s crippling obligations, while the slate knows intuitively that this is wrong.
There is still Candidates Night.