Whitby could see $650K deficit


According to the interim Rye Golf Club manager, the club restaurant at Whitby Castle is running at a deficit, but City Manager Scott Pickup said he is still optimistic the entire club will be in the black by the end of the fiscal year. File photo

The Whitby Castle restaurant at Rye Golf Club is running at a deficit of roughly $650,000, according to interim club manager Jim Lopolito.

However, City Manager Scott Pickup said the club as a whole is still in position to end the year in the black if the next few months bring in sufficient earnings.

At the Sept. 11 City Council meeting, Pickup told the council the Rye Golf Club Commission believes the club is “on target to having a cash-positive year,” a feat that, if it happens, would be achieved for the first time in five years.

If the club turns a profit this year, it would be especially impressive given the avalanche of negative publicity it received after former club manager Scott Yandrasevich was removed for allegedly stealing hundreds of thousands of dollars in member dues from the club over six years through shell companies he created.

But at last week’s golf commission meeting, Lopolito offered a different perspective. Based on the restaurant’s recorded earnings for the fiscal year so far, he reported that a lack of bookings for catered events, among other reasons, had resulted in a hearty deficit for Whitby Castle.

Looking ahead, while the club is projected to be in the red based on preliminary revenue estimates for the remaining months of 2013, there is still a possibility that the club will be in the black by the end of the year, Pickup said, calling the $650,000 estimated deficit for the club’s food and beverage operations “a moving target” that is likely to change.

“We are still managing within that expectation and we are hoping to still meet it,” he said.

This is in part because the club has reduced expenses in other places, he said. The city tried to drastically cut costs this year to account for changes at the restaurant; transitioning to new management under Lopolito in January and, for the first time, closing for two months out of the year.

At the moment, “it’s a pretty aggressively-managed facility,” in terms of keeping costs low, Pickup said.

In general, while Pickup admits that the year brought in disappointing golf cart rental revenue and total club member revenue, “we think we have ways that we can try to make up for this,” particularly looking at securing sought-after catering bookings during the holiday season, he said.

In addition to the possibility of realizing revenue via booking more catering events that were hard to come by during the earlier part of the season, there may also still be revenue for the taking by way of any golfers who trickle in to play the course over the next few months.

The commission will start to look at the club’s revenue at the next public commission meeting, Pickup said, which is scheduled for Oct. 23.

Outgoing commission member and strategic commitee member Angela Sposato said she was disappointed in the restaurant’s revenue numbers, but the commission is still waiting to see revenue numbers for the entire club.

“I was quite shocked at the numbers,” she said. “But I didn’t think [the restaurant] was performing to the level that we expected given that we hadn’t gotten many catering events in.”

However, Sposato said the club does have some big events coming this month, including a concert, that they hope will generate some revenue. The club will continue working toward this goal until the end of year, she said.

As the commission currently works on the club’s preliminary expense budget for 2014, members are considering the current year’s financial outcomes as well as a multitude of future challenges facing the club. Among these challenges is figuring out how to run the operation in 2014, Pickup said.

Councilwoman Julie Killian, a Republican, said the biggest issue concerning the golf club right now is figuring out who is going to run the club, including its food and beverage operations, for the foreseeable future.

Killian, who is the golf club strategic committee’s liaison, said she does not think the city should spend the money on a search firm to go look for a manager until the job of that manager has been clearly defined.

The reason the definition of the job is uncertain is the strategic committee just recently received permission from the commission to move forward in preparing a request for proposals for a company to outsource the club’s food and beverage operations, the councilwoman, who is seeking re-election in November, said.

“And [the general manager] job, if you’re running an entire club…they’re different jobs. Search firms are expensive, so I still think we need an interim person while we’re still figuring out what it’s going to look like,” she said.

“I think that if it’s city-run, the city has oversight and, even with the best manager in the world, the restaurant and catering business is really difficult,” Killian said.

Contact: liz@hometwn.com