Eastmoreland Origin Story: Part 5 - "the final click to the combination."

In Part 4, Keyser finds himself between a rock and a hardplace.  Eastmoreland is proven to be a going concern earning greens fee revenues in excess of expectations, yet the Tax Board Chairman Mulkey has determined that the the the City will not be allowed to endure any debts to complete the purchase of the land.  He declares golf must be totally "self-sustaining."

So while Mulkey may be the villain, like all great villains he sets the stage for the great triumph of Parks Superintendent Keyser, who in principle, also believes golf should be "self-sustaining" in that the golfers pay an exclusive privilege to play public lands (thus why we have no joggers or picnics on the 6th fairway).  Further he had the revenue - it's just the rate of the revenue was sufficient to pay a portion of the land price each year - and thus required some type of bond or mortgage to complete the purchase (again completely normal for real estate purchases).  To catch us up - he discovers the the "open sesame" magic key - to have golf construed as a public utility and thus open up the ability for the city to raise municipal utility certificates - that not considered part of the city's dept.  (Why - you may ask? Well the thought is due to the fact that since a utility has regular revenue the debt to be serviced can be considered to have reliable revenue - and this provision no doubt was to help spur municipal utility projects - like water and sewer and electricity and also provide an out should a private utility go under for some reason to ensure the utility maintains in service for the community.

Even though the leaders of the City thought construing golf a utility was a little crazy - except the Commissioner of Finance who happened to be a golf nut himself, Keyser was faced with a remarkably challenging task ahead.  That said he persevered as always and with the opinion of prominent corporate lawyer, he convinced Paul Murphy - the president of the development company that owned the land to accept the municipal certificates.  Not only that Mr. Murphy further agreed to pay the legal expenses to prove in court that golf would be construed a utility under the laws of the State of Oregon.  Now it certainly helps that the Commissioner of Finance was a avid golfer and the City Attorney wanted nothing greater than to ingratiate himself with a prominent corporate law firm, the plan went forward.  The certificates of $95,000 for the back 9 plus an additional $16,000 to expand the front 9 across Johnson creek. (as will be discussed more in layout and design) were issued and Mr. Murphy proved the entire issue legal and adjudicated in the courts that golf could be construed a utility under the law and approved by the Supreme Court.

Thereafter - the certificates were sold out in a matter of days and the city was able to use revenues for the greens fees to cover the debt - that is until the great depression hit and caused a bit of challenge. That said the going concern for golf was great and the City's Chamber of Commerce campaigned to bring the USGA National Public Link's Amatuer to Portland in 1933, the first time this tournament was played west of the the Mississippi. Not only that, the 1933 tournament was the 1st time the USGA national event was help in the state of Oregon! Having a national tournament at the club proved it's place in history as a top municipal course. 

Before carrying Johnson's opinion back to the city hall Keyser got in touch with Murphy and acquainted him with Johnson Murphy reported that he would accept the city's utility certificates at par, and, further, would undertake on his own account to test in the courts the validity of the postulate that golf was a utility within the meaning of the law. Murphy and Keyser called on the Mayor. The Mayor called in the City attorney and the commissioner of Finance. The upshot was that the City Attorney drafted an ordinance setting up an issue of utility certificates providing retirement in the amount of $95,000 to exchange for title to the land occupied by the 2nd or North 9 holes of the Eastmoreland Golf Course. The certificates for 6% interest and we're scheduled to be retired serially in ten years. The preceding was adjudicated and the decision was affirmed in the Supreme Court of Oregon. Murphy had no trouble in selling the entire issue at better than 102.
Prior to 1916 the Ladd estate company had leased the ground occupied by the first 9 holes together with 50 acres west of the S. P. Railway to the continuous Willsburg Dairy for cow pasture it. But a dairy cannot continue indefinitely within the limits of a growing city. This space was somewhat tight at the South End of the link and the city, in time, became the logical buyer of the dairy, which added 18 acres to the original 150. This property was negotiated with a payment of $2,000 cash and a supplemental utility certificate issue of the $16,000. It was anticipated that the total debt on the Eastmoreland Golf Course could be amortized as scheduled by 1936. The setup appeared to be sound. The course grossed $48,500 in 1930, from which revenues declined to $14,000 at the bottom of the depression.
When the City settled with Murphy as above related, the wet nursing tour of the trusteeship had been accomplished. All monies and properties it had controlled were turned over to the City in a final accounting. Through their initiative and perseverance the city had come into possession of a handsome adjunct to its recreational system, at a cost of a quarter of a million and with a realized value of at least a half a million. All along it have been the contention of the Head of the Bureau of Parks that as a policy the cost of the land should have been defrayed from the general taxation while requiring the golfer, because he enjoys the special exclusive privilege on public property, to pay the cost of development and of maintenance and operation. He was in friendly disagreement with Earl Riley when Riley became Commissioner of Finance in the tough days of the depression. However, there was nothing for Riley to do but make up the deficits to meet the debt retirement schedule. At length he succeeded in recapturing all outstanding utility certificates and holding them against redemption from greens fee revenues, principal and interest at 6%. Later Kaiser prevailed on Riley's successor to allocate 2% to the general fund  (the rate charged by the bank when the city had occasion to borrow) and to apply 4% to debt reduction. This was the final click of the combination.

In 1933 with the active support of the Portland Chamber of Commerce angling for conventions, the National Public Links Championship was staged on the Eastmoreland Course. To get this tournament awarded, the city had to promise a partial swamping of several greens and tees to bring the course up to National Tournament standards, particularly the 1st, 5th, 6th and 14th holes, and also irrigate all the fairways. This put the course deeper into the red, but at least made it a finished product second to none in class, to serve the golfer who may not belong to a country club.