Private Clubs and Moving Past COVID-19: Re-opening Considerations

Written by: Amber Stone, CPA

Over the last month, clubs have been consumed with loan and grant applications, worst-case budgeting scenarios and trying to follow the daily legislative updates. As clubs settle into their new “normal,” they are left with a lot of uncertainty and the stress that comes with it. One thing we know for certain is that sooner or later, the pandemic will end and the club will get back to full operations. Clubs may only have a few days’ notice that they can reopen and there is a lot to consider before then ⁠— so having a solid plan for each area of the club is essential.

General Considerations

Clubs can expect some level of social distancing upon reopening, whether it is required by law or encouraged to help members feel comfortable. Some activities, such as summer camps and large banquets, may need to be delayed beyond the initial reopening to adhere to social distancing. Clubs should begin considering how and when these policies will be communicated to members and guests. One great option is to continue using the electronic and virtual communications practices that were implemented as a result of COVID-19.

The club will also want to be transparent about its continued sanitation practices throughout the entire club. This applies to areas such as the kitchen and locker rooms, but also needs to include commonly overlooked spaces such as the card room, library, golf carts and so on. Cleaning supplies are still in high demand, so be sure to place orders well in advance.

Staffing

Clubs have unfortunately had to lay off or furlough much of the workforce, and it is important to keep a line of communication open to determine how many of those employees will be returning to the club. Some employees may want to return but need flexibility or more time off before returning due to school closures and caring for family members. Employees may need to be brought back in small groups, or even on alternate days of the week, to comply with both government and club-imposed social distancing measures. Additionally, informing employees of their status and schedule as soon as possible goes a long way in maintaining a good relationship.

Dining Services

Inventory levels have dropped significantly based on demand and suppliers have subsequently cut back on deliveries and availability. The club will need to plan ahead to determine the appropriate inventory levels and any purchasing delays prior to reopening. At the same time, the club should evaluate the physical layouts of dining areas in relation to social distancing. Members might be hesitant to come to a crowded restaurant. Outdoor dining spaces can help with social distancing and also feel more open, which may comfort members.

Carry-out has seen a sharp increase as a result of COVID-19. For non-profit clubs, this is considered a non-traditional activity which can impact your non-profit status. However, during the pandemic the general consensus among industry experts has been that the IRS will likely turn a blind eye to take-out services since the club is providing an essential service. Once the club is permitted to reopen, it is imperative for carry-out and other non-traditional activities to return to a “de minimis” amount as required by the IRS. This may make some members unhappy, but the club could be exposing itself if it continues to offer this service.

Golf

Some states are still allowing golf course access, while others have been required to close entirely. Either way, the greens are not being maintained at their standard levels right now. The club will need to determine how many days are needed to get the course ready, and if all of the holes will be reopened at once. The driving range and golf simulator areas may need to be evaluated separately. Fortunately, golf courses easily allow for social distancing but traffic in the pro shop may need to be monitored or limited. There may also be a preference or requirement for one person per golf cart.

Moving Forward

The same thought process used above can be applied to any area of club operations by thinking about what will make members comfortable and excited to come back to the club, as well as which resources are necessary for the club to fulfill those expectations. Clubs have really stepped outside of the box to come up with fresh and innovative ways to stay connected to members while the club is closed.

Continuing to brainstorm and encouraging creativity will lead to a successful reopening and increased member satisfaction in the future.

Amber Stone, CPA works in public accounting providing attestation, tax and consulting services to private clubs. She is vice president of the HFTP Maryland Chapter and a member of the HFTP Young Professionals Advisory Council.

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1 Comment

  1. This is a good post and certainly fits the timing, very insightful.

    Many of our clients have already started to re-open facilities in a phased approach.

    One thing we see common is that they are all setting up reservation systems that were not fully utilized before. One of our clients has opened up their Swimming Pool Facilities too by reservation only and restricting number of people along with blocking swimming lanes in between 2 swimmers to maintain social distancing of at least 6ft.

    We are also seeing many clients moving towards opening up there Fitness Centers that are being governed by the same kind of laws and in accordance to the guidelines by CBC.

    I cant comment on exactly how good of a decision it is to re-open or not; but it is certainly a positive sight to see club facilities like fitness centers and dining areas to start reopening and occupied by people instead of appearing to be just empty.

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