Is Hiawatha Golf Course making, or losing, money?

Is Hiawatha Golf Course losing money or making money?

Both options are asserted during community meetings.

The confusion lies in whether people are looking at the audited or unaudited figures, according to Minneapolis Parks and Recreation Board (MPRB) Assistant Superintendent Michael Schroeder.

It gets even more confusing because of the flooding in 2014 when the golf course lost money during and after the flood.

“Floods impact financial performance for many businesses, including golf courses,” pointed out Schroeder. “For Hiawatha, the potential for flooding exists, and it needs to be a part of a financial model.”

MBRB planner Tyler Pederson explained, “The unaudited financials tell us if a golf course is making money based on revenue received and expenses paid within the year.

Chart right: Hiawatha Golf Course Audited Revenue and Expenses (Illustration by Tesha M. Christensen)

“The audited financials also include depreciation (annual charge for past investments in the courses), revenue and expense adjustments made during the audit, and non-cash expenses including compensated employee absences, post-employment benefits, and pension liability. The audit is conducted by the Office of the State Auditor and requires the inclusion of the aforementioned expenses.”

Chart right: Hiawatha Golf Course Audited Income (Illustration by Tesha M. Christensen)

Hiawatha Golf Course last made money in 2009, when it generated a net audited income of $143,274. Since then, it has lost between $22,041 (2012) and $696,567 (2014). In 2017, it lost $360,370.

The 10-year audited loss is $1,986,049.

All MPRB’s golf courses have lost an audited $8,870,202 in the last ten years.

This does not include the $125,000 MPRB is setting aside each year for reinvestment in each course.

The unaudited 10-year loss is $749,518 with six of the last ten years losing money ranging from $11,122 in 2011 to $611,822 in 2014 (the year of the flood). In considering just the revenue received and expenses paid and not any other factors, the golf course was in the black in 2008, 2009, 2010 and 2012.