Putnam Weighs Golf Course Payoff

Finance chief says loan hobbles contractor
Putnam's finance commissioner is recommending that the county spend $4.7 million to pay off the loan used to acquire its golf course in 2003 and rebid the contract to run the operation.
Michael Lewis told the Legislature's Audit Committee on Monday (June 23) that the county would save $477,000 in interest with the early payoff of the tax-exempt bonds whose proceeds were used to buy the former Lake MacGregor Golf Course in Mahopac. He also presented an alternative in which the county would use $1.7 million to pay off a portion of the bonds, saving $175,198 in interest, when they are eligible for redemption on Jan. 15.
In addition to saving on interest, retiring the bonds would release the county from IRS rules that have proved "restrictive" for Homestyle Caterers & Food Services of Yorktown Heights, the company hired to provide beverage and food service for golfers and events. Those rules mean that Homestyle cannot "claim ownership, claim depreciation and/or amortization deductions, investment tax credits or deduct for any payment" related to the golf course, according to Lewis.
Because of the restrictions, Putnam also owns the drink, food and pro shop inventory and is responsible for the cash-handling, said John Tully, the commissioner of general services. Without those rules, a company holding the golf course contract would own the inventory and simply pay Putnam a share of the revenue from the course.
In addition to Homestyle, Putnam contracts with Troon Golf to run and maintain the golf course and its pro shop, and a third company hired "to protect our interests and make sure that those two other contractors are playing nice in the sandbox, and that they're coordinating events and all things together," said Tully.
"There would be a benefit to the county to only have one person or one entity to deal with, and that entity could be one of the three operators that are there today or somebody new," he said.
Putnam spent $11.35 million in 2003 to purchase a 375-acre property, which included the money-losing golf course and its banquet facility, the former Mahopac airport and Hill-Agor Farm. The county took the money from $40 million it received under a watershed agreement signed with New York City but later had to repay $5 million to the fund.
Since the purchase, the county has spent millions more on upgrades, ranging from repaving the parking lot to renovating the clubhouse. The upgrades included making the facility accessible to people with disabilities to settle a lawsuit filed in 2016 by Westchester Disabled on the Move Inc.
Homestyle has also faced accusations. A 2018 report by the Journal News centered on catering contracts that appeared to show that the campaign of then-County Executive MaryEllen Odell and a nonprofit founded by Legislator Amy Sayegh and directed by an Odell assistant were charged less than other groups for events at the course. Odell's campaign denied the accusation. Sayegh is now the Legislature's chair.
In 2022, the Legislature voted to use $400,000 of Putnam's $19.1 million in federal pandemic relief funds to renovate the golf course's restaurant, despite a $272,000 profit the year before. Putnam reallocated the money after being told the golf course project did not meet eligibility guidelines.
Legislator Nancy Montgomery, who represents Philipstown and part of Putnam Valley, has repeatedly called for more disclosure about the golf course finances. "I like the idea of saving money," she said on Monday. "But I think, for the public's interest, we need to review everything from the inception of the golf course."