Golf course operator asks MCRA to consider reducing amount of original purchase agreement
By Bruce Justice 06/06/2021
The lessee/operator and eventual purchaser of the Twisted Gun Golf Course attended last week’s Mingo County Redevelopment Authority meeting with a request.
Addressing the board, Ernie Sammons requested that the MCRA consider the unanticipated operational losses and everyday maintenance costs that he has incurred during the last six years of his lease and reduce the original payout price to help offset some of his losses.
Sammons’ Bella Vista, LLC leased the golf course from the MCRA in 2015. The lease contained an initial term of five years, with an option to extend the lease for an additional year.
The lease additionally encompassed a $1,000 per month rental fee, as well as an option for Sammons to purchase the golf course from the MCRA for $500,000.
The purchase price would then be reduced by the total amount of rental payments Sammons had made to date, which as of the end of May amounted to $72,000, leaving the balance owed at $428,000.
Because the one-year renewal lease expired at the end of May making the balance due immediately, Sammons asked the board to reduce the remaining balance to $375,000.
Sammons said golf courses in general across the country are experiencing financial difficulty and that many have already closed as a result.
“The golf course will never stand on its two feet financially because the expenses are simply too great,” he said. “It’s a great course, but probably within a 30-mile radius there are 200 golfers, with most of those coming from Pike County (Kentucky) and places like Charleston and Huntington.
“The original investment I had was $500,000 but I wound up having to pay another $300,000 for equipment, so it turned out to be a far greater number than I expected on the front end.”
Because the golf course in itself is not financially sustainable, Sammons said, he has had to find alternate sources of income to keep the course afloat.
“Three years ago I started hemp farming … the first year was a miserable failure and the second was moderately successful, but this year I feel we’ll have far greater success,” he said.
Sammons said he has since opened a store in Gilbert called “Hillbilly Jacks,” at which he sells hemp products and which he said has been surprisingly successful.
During the board’s discussion and consideration of Sammons’ request, Executive Director Leasha Johnson reminded members that the MCRA’s acceptance of the golf course from its former three-coal company ownership came with several obligations, one of which was the extension of electricity.
“When the golf course construction was completed, power was provided by the coal company’s private power source, and the former owners asked us to secure a power source that was independent of the coal company’s power,” she said. “We transferred that obligation to Bella Vista in the lease agreement. The process of securing a new power connection to the AEP grid has been an ongoing process, one that remains incomplete. While Ernie has paid the costs associated with the extension, we’ve been actively involved in the process from the beginning.”
Johnson said another obligation assumed by the MCRA when it accepted the golf course was to secure a public water connection. Since the golf course’s opening, she explained, it’s primary potable water source has been provided by the town of Gilbert; however, in the absence of a public utility connection, she said water has to be hauled to the golf course and requires monthly water samples to ensure the water quality has not been compromised during its transfer.
Water for the golf course’s irrigation system is pumped from a nearby mine pool, she said.
She said the MCRA applied for and secured a U. S. Economic Development Administration grant for nearly $1.4 million, for which it agreed to provide the local match of $348,00. She said the agreement was due to the MCRA anticipating the sale of the golf course to Sammons would generate more than $400,000 and possibly generate more development in the Twisted Gun Gap area of Mingo County.
Because of these and additional expenses, as well as a great many man hours the MCRA has incurred or obligated itself to during the six-year lease agreement, Sammons request to lower the payout by $53,000 was denied.
After attaining the approval of land and mineral owner Pocahontas Land Corporation and Mingo Logan Coal Company, both those companies, along with Premium Energy Corporation owner Don Nicewonder, began developing the golf course in the late 1990s.
All three companies agreed to contribute money for each ton of coal that was mined, which was money that ultimately would complete the golf course once the mining operation was finished.
It was considered Mingo County’s first Post Mine Land Use project, and, after its completion in the early 2000s, was and remains West Virginia’s only links style, 18-hole golf course.
In 2005, Alpha Resources bought Nicewonder’s West Virginia mining interests and co-shared an operating interest in the golf course, which was operated as a public course until 2015.
At this time, the three owners ultimately donated the course to the MCRA, which “due to having neither the capacity, expertise, nor the capital to operate the course successfully,” ultimately accepted transfer of the property after securing the lease agreement with Sammons.