On Tuesday at City Council, a request was approved from Hillcrest Golf Club for the club to enter into an open-ended loan for 90 percent, or up to $400 thousand dollars, from RBC for a clubhouse expansion project. 

Construction for the project is already underway. 

The Hillcrest Golf Course is currently under a 35-year lease agreement with the City of Moose Jaw. According to the original lease terms of the agreement, Hillcrest cannot enter into any debt obligation that exceeds $75,000. 

In 2017, Hillcrest’s profits totalled just over $2,900. This year, that increased by nearly 200 percent to just over $360,000. Cited reasons for the increase are recent operational changes, better accountability with finances, additional corporate sponsorships and contracts, reduction of unnecessary expenses and staffing changes.

During the discussion, councillors congratulated Hillcrest staff for increasing and stabilizing their financials. 

“Their financials I feel are very healthy and strong,” said councillor Crystal Froese. “I think this'll be a great thing not only for the golf course but for Moose Jaw.”

Councillor Dawn Luhning, however, asked to table the request to review it at a later date, citing questions about legalities in the event that Hillcrest defaults on the repayment.

“We own the facility and the land up there, right? So I’m just wondering if any legal opinion has come in about whether or not if this loan is defaulted on, how does the City protect themselves? Without some kind of reassurance that the City isn't going to be held accountable, I don't think I can vote in favour of the motion. Four hundred thousand dollars is not a small amount of money. There is a possibility that we could end up owing some of this money if it's defaulted on.”

Part of the request states that the City of Moose Jaw will not be held liable in any way for the repayment of the loan and will not be named in the contract with the Hillcrest Golf Club and RBC. 

“If they were to default in their payments, the most likely scenario would be that the bank would have to take over the operations of the golf course,” said Derek Blais, Parks and Recreation director.

Hillcrest is projecting a surplus of $200,000 this year, which they say will be set aside and applied to their loan payments for the first two years. This will give them the opportunity to fundraise and work on increasing club profits to help fund the remaining three years of payments. Hillcrest has indicated that additional revenues will be put towards the loan.

The Club has also indicated that they have $201,591 available in a low-interest GIC account which can be allocated towards the project.