Dear Valued Guest,
As mentioned in a prior notification, a new pricing model will be implemented at Paradise Valley and Rancho Solano beginning April 1, 2023. This pricing model, called dynamic pricing, is likened to what the airline, travel, sporting events, hospitality and yes, even golf industries have been using where prices fluctuate based on elements that impact demand.
Frequently Asked Questions (FAQ) concerning dynamic pricing at Paradise Valley and Rancho Solano
1. Why does the Fairfield municipal golf system need to dynamically price?
• Both Paradise Valley and Rancho Solano operate under an Enterprise Fund which essentially means the golf courses need to be a self-sustaining business without the need to receive a subsidy from the City’s General Fund. The operating budget currently does not meet the capital and infrastructure needs of the two golf courses.
• The Enterprise Fund structure also means that discretionary tax revenues collected by the city do not fund either golf course’s operations.
• If costs to operate the golf course, including their capital needs are not covered by operating revenues, the Enterprise Fund has to borrow funds internally, without an identified source of repayment.
• The Fairfield City Council has communicated the goal to have the golf courses become more self-sustaining. In support of the goal, in 2021, the City Council adopted a fee schedule with a flexible price cap of up to 20% above the baseline fees and further authorized the operator, KemperSports, to adjust all golf course fees up to the 20% price gap using a demand-based pricing model.
2. How will dynamic pricing work?
• Prices will be determined based on historical data that considers the day of the week, time of day, season, weather, and occupancy (or how busy the golf course is during that time of the day).
• The key takeaway is prices will fluctuate daily with the customer choosing either the time of day they wish to play regardless of rate, or the rate they prefer to pay depending on the time.
3. How much will green fees go up?
• Green fee pricing will fluctuate from $1 to $5 above the posted rate for all player types: public, senior, resident, senior resident, Loyal-Tee or senior Loyal-Tee based on the demand and all the other contributing factors that define that day slot.
• During this initial rollout phase of dynamic pricing, green fee increases during high demand times has been capped at $5 which is below the 20% price cap City Council approved. The city and the operator will continuously monitor and reevaluate the dynamic pricing model throughout the year.
4. Could green fees be lower?
• Yes, if these same measures show demand to be low during any given time slot, prices can fluctuate down $1 to $4 as well.
The table below outlines the range of price each player type will pay throughout the week:
5. Would green fees have gone up without dynamic pricing?
• Yes, instead of prices being based on customer demand for tee times available at each course, the golf course would have instituted a fixed price increase across the board.
• The current rolling 12-month Consumer Price Index (CPI) increase for the region currently sits between 5-6%. So instead of arbitrarily increasing all prices by a fixed amount, dynamic pricing will offer a range based on demand between -8% to +11% depending again on day of week, time of day, and player type.
We hope that you will find that these modest price fluctuations through a dynamic pricing model a reasonable compromise to assist in creating capacity to bridge gaps in covering the total costs needed to operate and sustain both golf courses.
Kind regards,
Jeff Perry
General Manager
KemperSports, Inc.
Kristina Kaunzinger
Director of Parks & Recreation
City of Fairfield