Rockville Lowers RedGate Lease Payments Due to Water Woes

The City of Rockville will reduce the lease payment for the company that manages RedGate Golf Course, due to problems managing irrigation water.

The Mayor and Council voted 4-1 on Monday to amend the city’s 10-year lease with Billy Casper Golf, which has been operating the 18-hole course since January 2012. Councilwoman Bridget Donnell Newton cast the opposing vote.

Under the amended lease, Billy Casper Golf will pay a lease fee of $100 per year through 2016, and $12,000 for 2017 to 2021.

Under the old terms, Billy Casper Golf was to pay $12,000 per year through 2016, and $24,000 for 2017 to 2021, according to city records.

Billy Casper Golf will be relieved of a debt service payment obligations of $25,000 to $30,000 a year and $38,085.66 of a $133,463.65 past due water bill will be forgiven.

Councilman John Hall Jr. characterized the lease amendment as a $500,000 subsidy over the remainder of the lease.

"That is less than the cost of the subsidy that this city was putting into this operation less than two years ago—for one year,” Hall said Monday. “So we're talking about a half a million dollars over the remaining eight and a half [years of the lease]. That is less than the $600,000 that the city was pouring into this operation just two years ago, and it's a little more than the $400,000 that it was pouring in 10 years ago when I served on this body previously."

Solutions for RedGate's water problem

Christine Henry, the city's acting director of recreation and parks, said the amended lease was an attempt to address water problems at RedGate. 

“Anybody who is going to run that course is going to need water to run it, period,” Henry said. “We're investing in our asset, so that our asset is viable in the future.”

The city agreed to cover part of the cost of to mitigate some of the water problems, like lowering the pipe that drains the irrigation pond so that it yields more water and exploring the long-term solution of installing a well on the property.

“We feel that a one-time investment in well exploration or digging a well would be worth it for the future of [Red Gate],” Henry said.

City staff and the golf management company have since agreed that 18 million gallons a year is more plausible for RedGate—though it’s 7 million gallons more than Billy Casper Golf had budgeted.

Under the new terms, if the well were to produce those 7 million extra gallons each year, the lease would be renegotiated back to its original state.

Other changes to the RedGate lease

Though the lease amendment passed 4-1, Mayor and Council made some tweaks to what was proposed.