OCEAN CITY — With the Eagle’s Landing municipal golf course having a banner year and significant and costly upgrades pending, resort officials this week debated if there was room to grow the per-round fees.
The Recreation and Parks Committee this week discussed Eagle’s Landing and its current per-round fee structure. The fee structure is largely driven by supply and demand and fluctuates by the season and even the time of day, as most courses do. Because it is a municipally-owned and operated course, the goal is to provide value to the residents and visitors, while covering expenses.
That is how Eagle’s Landing has been and continues to be operated for the most part. The municipal golf course is essentially an enterprise fund, and as such it’s supported largely through user fees. In a perfect year, round fees and other user-generated fees support the golf course with little or no contribution needed from the town’s general fund.
Eagle’s Landing remains a gem among the other private courses in the area and was ranked by Golf Advisor magazine as the third best course in the state this year. There have been times when Eagle’s Landing has been ranked the best in the state, but it has consistently been in the top five over the years.
However, after three decades, Eagle’s Landing and its infrastructure are in need of renovation and repairs. There is a chronic flooding problem on some of the tidal waterfront homes and a consultant did a recent study to develop a series of recommendations to mitigate those issues. Some of the bunkers need to be renovated and some repairs are needed to the clubhouse and other facilities.
The flooding mitigation project was ranked as “very important” in the town’s most recent capital improvement plan and it comes with an estimated $1.5 million price tag. The project will likely be funded in a future bond issue, but the recreation and parks committee debated if some of the cost could be offset by a modest increase in per-round fees. Recreation and Parks Director Susan Petito said Eagle’s Landing has been thriving this year, largely because it’s considered a great value compared to some of the other private courses in the area, but welcomed the discussion about nudging up the fees. She said the fees per round are adjusted to meet the demand and the time of year and event time of day.
“We’ve had an incredibly successful year,” she said. “We’re not jumping in for price increases because we’ve been doing it all along.”
Eagle’s Landing PGA Professional Bob Croll said the per-round fees are adjusted throughout the day with higher rates for a peak early morning slots, another adjustment for the 11 a.m. to 2 p.m. range, and, finally, a later afternoon rate.
“We do the same dynamic pricing as, say, hotels and airlines do,” he said. “When they’re booking close to the time they want to play, the cost is more.”
Croll said the rates are adjusted by season as well.
“It really depends on the season,” he said. “During golf package season, the rates are pretty set. During the summer, the booking is often last minute anyway.”
Croll said there has been very little pushback from the consumer on the per-round rates at Eagle’s Landing.
“There is no problem for the customers,” he said. “They’re used to it. We’ve been doing it for four years. The demand has increased substantially in recent years.”
Croll said the spring golf package season was a little off compared to other years, but Eagle’s Landing still had no problem filling in its time slots.
“Packages were down about 25% in the spring,” he said. “We still filled the rounds. It was interesting. There are times when the cost per round goes down. We’ve been able to take advantage of those looking for value.”
Councilman and committee member Mark Paddack questioned if there was a twilight rate for those seeking to sneak in few holes at the end of the day. Croll explained there has traditionally been a late afternoon twilight rate, but the demand for that has changed.
“There was a time when you started in the afternoon and may not or probably not going to get in 18 holes,” he said. “There’s not a lot of demand for that these days because there are so many courses.”
Questions were also raised about the pace of play. Paddack said he recently played a round at another local course and it took over five hours. Croll said Eagle’s Landing carefully moderates that, which contributes to the value.
“We’re really good about the pace of play,” he said. “Some courses react to slow play, but we try to be out in front of it.”
Croll said it seems the average player is less consumed with the cost of a round compared to the value.
“I’ve found this year the price doesn’t make a lot of difference,” he said. “They’re getting a great value. They want to play when they want to play. We’re always trying to provide a value.”
Paddack asked if there was room to nudge the per-round cost a little to help offset the pending improvements.
“We have a plan to mitigate the aging course with improvements,” he said. “If there is room to explore growing our fees, we should consider that. We don’t want to go to the taxpayers to foot that bill if the user fees can help cover it. If you’re talking about 5,000 to 10,000 rounds, a couple of bucks adds up.”
Croll said he could certainly explore that, but was conscious of the value at the municipal course.
“If you want to be more aggressive with pricing, we can do that,” he said. “We’re always trying to be competitive, but we’re also value-oriented.”
For her part, Petito agreed there could be an opportunity to nudge the price per round, but said things were going well and there was a risk in increasing the fees.
“We’re very conscious with pricing,” she said. “What will the customers bear in terms of what they pay to play? We’ve had one of our most successful years in a long time.”
Croll pointed out a handful of courses in the area have closed in recent years, which makes the demand at Eagle’s Landing higher.
“The market is still very competitive,” he said. “The number of courses in the area has been shrinking. That has had an impact on the courses still around. That’s a lot of rounds to spread around. The goal has always been to break even and cover expenses. We’re in a little different position as a municipal course.”
Councilman and committee member Lloyd Martin asked about the Talon Club, a rewards program of sorts for locals.
“The Talon Club years ago offered an affordable opportunity for the locals,” he said. “Things have changed. We’re still happy taking care of the locals, but there might be an opportunity to raise prices a little during peak times.”
Councilman and committee chair John Gehrig said Croll, as the course’s PGA professional, was best suited to determine the fee schedule for Eagle’s Landing.
“You’re the pro and we rely on you to keep an eye on the market,” he said. “We have capital projects we need to do. We just need to make sure we’re offsetting that during what has been a great year.”