Legislative Public Meetings

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File #: 19-0309   
Type: Report to Council Status: Passed
Meeting Body: City Council
On agenda: 6/11/2019
Title: Approve Budget Modification No. 19 for the Golf and Tennis Operations
Attachments: 1. Management Agreement and Termination of Existing Agreement, 2. Barrel 19 FY2018/19 Operating Budget
REPORT TO COUNCIL

SUBJECT
Title
Approve Budget Modification No. 19 for the Golf and Tennis Operations

Report
BACKGROUND
The City presently owns and manages two public golf courses Sunnyvale Golf and Sunken Gardens. Sunnyvale Golf Course was built by the City in 1967 and opened for business in 1968. It is an 18-hole championship course situated on 145 acres of property at 605 Macara Avenue. Sunken Gardens Golf Course, which includes a driving range was purchased from a private entity with bond revenue in 1973, and was shortly thereafter re-opened as a public course. These facilities operate as part of the Golf and Tennis Enterprise Fund. Services provided at these facilities include golf play on-course, golf practice on the driving range and putting greens, golf merchandise sales, golf cart and equipment rentals and golf lessons.

Buildings at each course currently house a pro shop, restaurant, bar, banquet rooms and outdoor patio space. Areas used for food, beverage, and banquet related services (those encompassed by the scope of these leases) include approximately 16,000 square feet at Sunnyvale Golf Course and 3,000 square feet at Sunken Gardens Golf Course. Since inception, food, beverage, and banquet services have been provided through agreements with outside vendors. These agreements are non-transferable, and non-saleable.

The City entered into a Concession License Agreement with Gold Rush Eatery for the operation of the restaurant at Sunken Gardens Golf Course on August 13, 2015 (RTC 15-0908). Subsequently, the City entered into a Concession License Agreement with KSM Sunnyvale, LLC (KSM) for the operation of the restaurant at Sunnyvale Golf Course on June 1, 2016 (RTC No. 16-0163).

KSM signed the Concession License Agreement on June 1, 2016 to open Barrel 19 Bistro & Bar (Barrel 19) at Sunnyvale Golf Course. The Agreement was for ten years and called for rents to be paid to the City of $500 per month for the first two and one-half years gradually in...

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