Introduction
Sharp Park and Golf Course is located on the sea front in San-Francisco. The park has a beach front view with holes 3 and 4 located right at the beach and a coastal trail passing adjacent to these two holes. The golf course in Pacifica is under the ownership of the government of San-Francisco. This prime piece of property generates a modest amount of revenue for the state. There has been a recent debate on whether the golf course should remain in operation with rising sea levels and erosion of the beachfront property threatens to engulf the whole course. Passionate golfers and a section of the public propose that a costly wall is put up to protect the course. The idea has been dispelled because the wall would lead to the eventual destruction of the beach. Environmentalists are against this proposal.
The problem of erosion is, however, very real, and measures need to be put up for the future of the golf course. This paper will delve into the evaluation of the economic value of the course and the trail, and see whether the loss of the course would be a tragedy or a good thing. The paper will also highlight the growing problem of erosion of coastal land due to the increasing sea levels. The issue is of global importance because the situation is the manifested in all areas of the world in the form of flash floods, landslides and hurricane storms causing massive loss of lives and property.
Soil Erosion and Rising Sea Level
The coastal areas of the world’s continents are facing the threat of erosion due to the growing rise in the sea level. The coastal regions of the world hold a significant amount of the world’s population with USA having a third of its population, approximately 100 million people, living in coastal region. Soil erosion is the gradual removal of the top layer of soil by water and air. The coastal city of San-Francisco is subject to incidences of soil erosion. The El-Nino has subjected the coastal cities along the Pacific to the threat of having buildings along the coast fall. The erosion brought about in the coast has seen the government close down apartments that are in danger of collapsing into the ocean (Mazza).
The sea level has been steadily rising from the start of the industrial revolution. The rate of the rising level of the sea has increased exponentially over the past few decades than at any other time in history. From 1993 to 2009, the sea level has risen by 0.11 to 0.13 inch per year representing a 90 percent increase in rate when compared to the rate in 1907 (Union of Concerned Scientists,43). The exponential rise in sea levels can be attributed to the impact of global warming on the world’s water bodies.
Carbon emissions from human machinery and industrial activity have led to an increase in global temperatures. The slow but sure destruction of the ozone layer leads to a situation where more heat enters the atmosphere, and little is reflected back into space. This greenhouse effect has affected the water levels in two ways. The first is the expansion of the water bodies. Water bodies such as oceans and lakes absorb approximately 80 percent of the heat in the atmosphere; an increase in global temperatures has led to increased absorption and expansion of water bodies. The water level rises because of this.
The second and greater factor is the melting of the land ice. Glaciers, ice and ice sheets account for 70 percent of the fresh water on the planet. When the temperatures in the atmosphere rise, the ice melts and flows downstream to oceans. This accounts for the increased rate in which the sea level is rising.
Economic Value of the Golf Course
The economic value of an asset is measured by how much financial gain it can give the owners over a period. The value is based on the expected returns minus the projected cost. A positive difference indicates that a positive economic value can be derived from the asset whereas a negative one indicates the asset is economically unviable. To establish the economic value of Sharp Golf Course, a thorough evaluation of the expected gains must be carried out (San Francisco Budget Analyst).
a) How many people use Sharp Park Golf course?
The number of people who attend the golf course can serve as an indicator of the popularity and profitability of the course. The Department of Recreation in San Francisco lacks a proper data collection method, and decisions are often made based on employee preferences without supporting data. The information collected on the number of people who attend the golf course is collected on a monthly basis. This information is crucial in determining the economic value of the golf course to the people of the city.
Reported Recreation Attendance Figures for August of 2005
Source: Recreation and Park Department Planning Division
The information shows that there is a bigger number of people attending the course informally and for fun. These figures indicate a large number of users of the recreation facility (Shmanske 58).
b) Value of a round of golf
The demand for golf often dictates the value of the rounds. In a situation where the golf course is located in a scenic area with good grass, the value of one round will be higher than one located in a less scenic place. Another factor that contributes to the value of a round in a golf course is the type of course. A private golf course focuses on making profits, and their operation is inclined to the same. There is extra effort put in customer care making the golfer feel as comfortable and pampered as possible.
Municipal courses are run by the administrative authorities and the policies surrounding the value of a round are often dictated by the current political issues. Some cities give special discounts to the elderly and some have special family days where the value of a round is often reduced. Most courses use time periods to quantify the quality of the game. There is usually an “early bird” and "Twilight" rates that are usually different from the normal rates. The early bird rate is usually lower, encouraging increased patronage during these hours.
Sharp Park Rates
Source: sfrecpark.org
The rates for the golf course are among the standard rates of most golf courses. The prime location of the course with the beach front view makes the rates of this particular course slightly higher than other public courses in the region. The course offers special rates for its residents with the elderly and young getting great discounts. All patrons pay less during the twilight and more for when major tournaments are being played.
c) Substitutions
If Sharp Park were to close down, the average golfer would have to go elsewhere to find golfing activities. There are many golf courses in the city of San Francisco. San Francisco is well known for its private courses such as Olympic Club where the US open was played. There are also a varied number of well-known and well-maintained public golf parks.
The top rated courses available in the city include Wente Vineyards, StoneTree, Northwood, and Cinnabar. San Francisco Recreation and Park Department is proud of having six world-class public golf courses under its management. The parks include TPC Harding Park, Lincoln Park, Gleneagles, Golden Gate Park and TPC Fleming. All these parks are alternatives that a golfer can visit in the case that Sharp Park closes down.
Consumer Loss
A regular golfer who goes to Sharp Park will suffer a loss in the form of cost of transport and the possibility of paying higher rates. If the client chooses to go to Lincoln Park instead, there will be the extra cost of transport because the park is further away from Sharp Park. The rates are also slightly higher making the experience more uneconomical for the client.
There is little demand for 17 hole courses since most of the major tournaments are held in 18 holes courses. Amateur golfers also want to try a hand at the big courses to feel like one of the pros. There is a decline in the patronage of seventeen holes courses such as Sharp Park among the golfers.
d) Economic loss
The closure of Sharp Park will have a significant economic impact on the economy of San Francisco. The willingness to pay often exceeds the actual price that would be paid. In the case of Sharp Park, the expected daily revenues can be calculated by multiplying the expected annual income from the annual cost of maintenance. The city stands to make a profit of $2 Million annually from shutting down the park.
2) Coastal Strip
The coastal strip borders the Pacific Ocean and passes right next to Sharp Park. The beautiful strip attracts many locals and tourists who want to enjoy a walk along the coast with a great view of the ocean. The data of the strip is thin and not well organized. The department does not have a well-maintained record.
a) Attendance
An estimate of the number of people that visit the beach is hard to track. There are several ways through which an estimate can be made according to the factors of the location. A beach in an area with sunny weather will have more visitors per day than one that has bad weather. San Francisco experiences good weather along its coasts is located next to a metropolitan with a large population. The number of tourists travelling to San Francisco on a daily basis is also considered in making the attendance estimates. The estimated number of people passing through the strip is 2000 per weekday and almost double that figure during a weekend.
b) Estimated Number of People
There are an estimated 400 customers at the Park; this is considering the distance from the city where the park is located. Another factor that is considered is the price of playing at the park. The estimates total to 2,400 persons passing through the beach on a daily basis. This figure is subject to change during the winter season and increases during the summer. Holidays also sees a spike in the number of people passing through the beach and the Park as well (INFONA).
c) Economic metrics
The best method to be applied in estimating the economic value of the company includes estimating the number of persons attending the golf course. The number can be extrapolated to get an annual figure through which it can be multiplied by the amount raised. This method is simple to use and involves little jargon.
d) Total Value
The total value can be obtained by multiplying the number of visitors by the value they generate in a day. These figures are obtained from the various statistics gathered in the park. The total value, in this case, is not a final figure because of the dynamic nature of visitor numbers.
The daily visitor estimates are 400 and the value raised is estimated at 80,000. The total value would be $32,000,000 annually.
Conclusion
In conclusion, the problem of global warming has had a diverse effect on the planet. Sea levels have risen in the past few decades to bring about a threat to coastal life. The world's coastal regions are facing the threat of being wiped off as the rising sea levels push further inland. In this paper, the issues surrounding rising sea level and soil erosion are discussed.
Sharp Park is a state-owned park that is located next to the beach. A study of the economic value of the course in the case of closure is done. The economic value of the park is $32 million and would be a great loss for the economy of San Francisco.
Works Cited
INFONA. "Who's Counting: An Analysis of Beach Attendance Estimates and Methodologies in Southern California." INFONA - Science Communication Portal. N.p., n.d. Web. 18 Apr. 2016.
Mazza, Ed. "El Niño Erosion Leaves Pacifica Apartments On The Brink Of Collapse." The Huffington Post. N.p., 25 Jan. 2016. Web. 18 Apr. 2016.
San Francisco Budget Analyst. "Management Audit of the Recreation and Park Department." (2006): 58. Web. 18 Apr. 2016.
Shmanske, Stephen. "PRICE DISCRIMINATION AT THE LINKS." 1.1 (2013): Web. 18 Apr. 2016.
Union of Concerned Scientists. "Sea Level Rise." SpringerReference (2012): n. pag. Print.
