LV audit finds golf course lost money

Dan Kulin

Friday, April 15, 2005 | 11:13 a.m.

A Las Vegas audit found the city's Durango Hills Golf Course lost more than $2.8 million during its fist two years open, overpaid taxes, saw more than $25,000 worth of food spoil, and had a former supervisor who used course employees and equipment for his private business.

The $12 million executive golf course in the northwest part of the city opened in November 2002, when it was projected to clear more than $1 million in profit during its first two years open.

Instead, there was lower than projected play and the course lost $2.84 million during that time. Deputy City Manager Steve Houchens said the course was expected to see 72,000 rounds of golf a year. But instead the number of rounds played was 29,000 in the first year and about 40,000 in the second year, he said.

The golf course is operated by IRI Golf of Arizona, Houchens said. Attempts to reach an IRI official this morning were unsuccessful.

Houchens said IRI has a six-year contract with the city that ends in November 2008. Under the contract, the city pays IRI $100,000 a year, plus bonuses based on financial performance, to run the course.

In addition to the financial shortfall, the audit, which Houchens said was part of the city's regular practice of self-auditing different divisions, also reported several questionable situations or practices at the course.

The audit, which was authored by City Auditor Radford Snelding, said that between November 2002 and May 2004, the golf course operators overpaid state taxes by about $100,000 and have not taken any action to get a refund.

The operators also didn't take advantage of city's exemption from paying taxes on certain items and ended up paying more than $40,000 in other taxes they didn't have to.

Other points in the audit included: