Eagle Creek Opening Back on track (at least the golf course portion)

[The Filthy Oar]

Story  from http://shelbyvilledailyunion.com/

Work to Start on Eagle Creek Resort Reopening
Contract Agreement Signed Wednesday
VALORIE EVERSOLE - Daily Union Staff Writer
Daily Union

SHELBYVILLE, IL. ? A year after being shuttered by court order, Eagle Creek Resort and Conference Center near Findlay has a chance at a new life.

The Illinois Department of Natural Resources (IDNR) has approved an agreement Wednesday with BMDD Resorts Corporation of Decatur for redevelopment and operation of the the resort.

The 23-year-old resort was shuttered in July 2009 because of mold and financial issues.

The IDNR took over the property shortly after the closure of the facility and began the search for a new manager.

?It was unfortunate to have to close it (Eagle Creek Resort) in the first place,? said IDNR spokesperson Chris McCloud. ?We worked as fast as we could to turn this over to someone. We are not a property manager so it is exciting for us to hand this over to someone responsible.?

?There were four bids submitted and this company met the needs of the department,? McCloud said.

He added that BMDD Corporation was approved earlier this year but the contract had to be worked out between them and the IDNR.

Part of the agreement states that BMDD will pay the IDNR $40,000 a year for 10 years to operate the resort. Renovations could cost as much as $3 million.

?This is exciting news for Eagle Creek State Recreation Area and the Lake Shelbyville region as the agreement clears the way for millions of dollars in private investment in the complex - and the reopening of the resort, which will provide a huge boost to the area economy and create jobs,? said IDNR Director Marc Miller. ?BMDD Resorts Corporation has pledged improvements that will make Eagle Creek Resort the perfect destination for golfers, anglers, business meetings, and family vacations.?

BMDD has already taken over management of the golf course at the resort and plans to reopen it later this summer.

?We have been maintaining the golf course grounds since March,? said Mike Ballinger of BMDD. ?We are starting to ramp up the renovations on the course itself to be able to open it in August. We?ve had a lot of golfers call about it.?

Ballinger also said that work will begin immediately on redevelopment of the lodge and conference center facility and is expected to reopen in 2011.

?It?s a wonderful facility and I see a lot of potential in it,? Ballinger said. ?I?ve been there myself for conferences. I?ve noticed the slight decline over the years.?

BMDD plans a multi-phase redevelopment project for the complex, including roof replacement; mold remediation; replacement of furniture, fixtures, and mechanical systems; complete guest room renovations; kitchen, conference room and restaurant and lounge renovations; and indoor pool facility rehabilitation.

?It will be about a year?s worth of work,? he said.

BMDD will manage the facility according to the state guidelines.

The closure of the facility last year impacted finances for Shelby County. With the reopening, there is a positive outlook at the local level.

?We could definitely tell a difference because we didn?t get the motel taxes,? said County Board chairman Dick Clark. ?I feel this (the reopening) is a great thing for the county. It will help our tourism and enhance our county.?

Clark added that having a local  management will help with the success of the facility.

?They know what our area is. They must feel positive about it themselves to take it on,? Clark said.

State Representative Bill Mitchell on a stop in Shelbyville Thursday said he was very pleased with the news about the reopening of Eagle Creek.

?The sooner they get the golf course open, the best for the economy for this area, ? Mitchell said.

?It?s an attraction that definitely needs to be utilized. The tourism dollars for this county is huge. The tourism industry pays dividends to this area.? added visiting state representative candidate Adam Brown, who accompanied Mitchell.

The Shelby County Office of Tourism will also benefit from the reopening as some funding will be restored, according to director Freddie Fry.

?Just getting the golf course reopened will bring another layer of focus to our area,? Fry said. ?Having an area based firm manage it is a benefit because they know about our area and what we have to offer.?

[The Filthy Oar]

Interesting piece of information from The Champaign News Gazette

Eagle Creek lease means state may never get income, documents show
Wed, 07/21/2010 - 10:00am | Tom Kacich
SPRINGFIELD ? The new owners of the Eagle Creek Resort on Lake Shelbyville will pay the state Department of Natural Resources an annual rent of $40,000, according to the lease agreement signed July 7.

But the agreement is structured in such a way that the state may never receive any revenue from the resort's operation.

The lease agreement was obtained by The News-Gazette through a Freedom of Information Act request.

The 21-year lease, which runs through June 29, 2032, says that Eagle Creek's new owners, BMDD Resorts Inc. of Decatur, "upon inspection and approval by DNR shall be permitted to offset the annual rent due under this paragraph against the reasonable costs incurred and paid by lessee and reported to DNR."

Reasonable costs include "those that are appropriate and necessary for the rehabilitation of any part of the premises" as well as capital improvements.

In the bid proposal it submitted to the DNR last winter, BMDD estimated it would cost $3.7 million to rehabilitate the 138-room lodge and resort that was closed last summer because of extensive mold problems. The former owners of the property, Barry Shiffman and Edwin Edelberg, had abandoned the 24-year-old resort.

Eagle Creek is about 70 miles southwest of Champaign-Urbana on Lake Shelbyville.

Chris McCloud, a spokesman for DNR, acknowledged that it may be some time, if ever, before the state receives any lease payment.

"This wasn't our property to begin with. It was the former owners and operators of the facility who foreclosed on the property. The bank did not choose to keep the property. So in that sense this problem was given to the state," McCloud said. "So if we were not able to sign an agreement and not turn it over to a responsible party that has some expertise in running theses kinds of facilities, then it would have cost us much more than forgoing the lease payment for however long it takes for BMDD to recoup some of their costs for renovation.

"The trade-off is that it would have cost us a lot more if our only option was if we had to run it or renovate it."

In another section of the lease agreement, DNR is required to remove at its expense all furniture, furnishings and equipment at Eagle Creek that BMDD does not want.

That could be a considerable expense to the cash-strapped state government.

A report last January estimated it would cost $892,500 just to remove mold-damage infrastructure and contents from Eagle Creek.

Dennis Fayhee, owner of the nearby Sullivan Marina and an unsuccessful bidder for Eagle Creek, called the lease agreement "a sham."

He asserted that state officials had said they didn't want to be burdened with more Eagle Creek expenses, but that the lease agreement did so.

"That's a big expense, especially when the primary purpose the state had was to not commit any state money to the renovation," Fayhee said. "That's a major, major part of the mold remediation. That could be carpeting. That could be wall covering."

McCloud said he did not have an estimate for how much the state would end up paying to remove unwanted furnishings and equipment.

"I don't know what has to be taken out and what is going to be used and is not going to be used. There are a number of things that are going to have to be taken out," he said.

Fayhee said the lease agreement requires little from BMDD.

"There's just no commitment. I've never heard of anyone signing a lease agreement that doesn't commence for nine months," he said of the provision that says the lease begins April 1, 2011.

"They signed a lease with no development plan? In the last 4 months they didn't have time to come up with a development plan? They've got no commitment from the guy they gave the lease to."

Other provisions of the 22-page lease agreement, which was signed by Gov. Pat Quinn, BMDD President Michael Ballinger and DNR Director Marc Miller, include:

? BMDD to deliver by early September a plan for its improvements to the resort. DNR has 14 days to review the plans and to provide written comments.

"I think it's just a chance to review what their plans are for the facility. We have full confidence they know what they are doing in terms of how they want to go about renovating it," McCloud said. "I don't believe there is any kind of looking over anybody's shoulder on a daily basis."

? Permitting BMDD to open the 18-hole golf course at the resort as soon as possible.

"IDNR hopes that you are able to open the course soon ? it would be a wonderful show of commitment to the local community to have it open," Miller wrote.

? Requiring BMDD to pay prevailing wages in the renovation project and in the operation of the resort.

? BMDD to file quarterly reports with DNR documenting all renovation costs and capital expenditures.

? Allowing DNR to shut down the resort permanently in the event of a fire or other casualty.

? Requiring BMDD to provide the state every May 31 a copy of the previous calendar year's annual financial statements.

? Permitting both sides to terminate the lease at any time upon mutual agreement.