October 28, 2001 11:00 pm

By T.L. Petersen

Observer Staff Writer

UNION The City of Unions Buffalo Peak Golf Course is planning for what could be a difficult second year.

But for now the city is simply studying its options, not making any decisions, says Councilor Barbara James, a member of the citys golf course committee.

James said the city was able to make the full interest and principal payment due July 1 and has the money $150,000 already banked for the Jan. 1, 2002, interest and principal payment.

But the original planning for the 18-hole course had been to have the golf course open for a full year and part of another year before any bond payments came due.

That, James said last week, didnt happen because of delays related to the relocation of the transfer site and access road to the property, and the hiring of a golf pro.

Instead of opening for play in the fall of 1999 and playing all of 2000 before the first bond payment came due in 2001, the golf course didnt open until late September 2000 leaving less than one full year of revenue from green fees and memberships.

And since Buffalo Peak opened, the number of rounds of golf played has been less than originally anticipated.

Its probably been a little lower than I would have expected, golf pro Dave Spurgeon said.

Since April there have been about 10,500 rounds of golf played. Spurgeon did not have figures on how many of those rounds were for 18 holes and how many were for 9 holes.

In addition, the course sold just 59 season passes, less than anticipated in early projections.

While Spurgeons duties this winter include setting up more detailed recording and tracking systems at Buffalo Peak, the citys golf course committee, a community advisory group and county officials are still only able to suggest where difficulties arose as the course developed.

James, who has been involved in the planning since the idea of using a golf course as part of a waste water recycling system originated, looks back to a situation beyond the citys control.

The city hired First Golf, a company based in Tempe, Ariz., to oversee the development of the course.

During development, First Golf merged with Classic Golf, a Georgia-based company that soon went public.

The situation between Classic Golf and the city has left some at Union feeling that the city has gotten less attention than was expected while dealing with First Golf.

Weve got a beautiful course here, James said. First Golf did an excellent job.

But the city has been through two course managers/golf pros since opening, a situation that is supposed to be handled by Classic Golf, the course management company, but that has fallen on the shoulders of county and city supporters.

After a temporary manager left just as the course was opening, county and city golf committee members recruited the next two pros, both of whom were hired by Classic Golf at the citys urging.

The first pro left for an advancement offered by Classic Golf in June this summer.

But now with a pro in place and the course open for a year, James, Spurgeon and others are taking a proactive approach.

The return this fall of 15 golf carts to a rental company was planned, James said. The course also leases 30 carts year-round.

Spurgeon is beginning work on a long-term publicity and marketing plan for the course, which to date has only put out a number of spot ads and relied on word-of-mouth advertising.

And the city is researching possible ways to redo the revenue bond financing to try to gain a more favorable bond agreement.

Initial contact has been made with the bondholder, James said, to see if there could be any renegotiations. The city is also in touch with Oregon Economic and Community Development Department representatives about other financial options.

Approaching the county which has the ability to get state financing at a lower interest rate for the golf course bond than that of the present bond and asking it to purchase the bond is an option, but no official steps have been taken in that direction to date, James said. She added that it has been made clear to Union that the county isnt trying to take over the course.

Were leaving no stone unturned, she said.

Weve got the time to work out what we need to work out before there are any critical financial problems.

The city has received help from the county in getting the golf course open and operating with some economic development funding, James said, but none of the aid has come from taxpayer dollars.

Were so thankful for the help they have given, she said.

The current efforts to refinance the bond at a lower interest rate are not the result of any one thing, both James and Spurgeon said.

The opening delays were hurtful, the personnel problems distracted from some original marketing efforts, and the death of former city administrator Leonard Almquist a font of knowledge caused the city to be without his help during the final stages of construction and opening.

This golf course means a heck of a lot to me, said James, who doesnt even golf. And that golf course is not walking away. All this just takes a little bit of time and a lot of work.