Americans and Golf, and the local assessor

For the past few days, an article entitled "More Americans Are Giving Up Golf" has been on the NYT's "most emailed" list.  A few excerpts:

“The problem is time,” offered Walter Hurney, a real estate developer. “There just isn’t enough time. Men won’t spend a whole day away from their family anymore.”

The five men who met here at the Wind Watch Golf Club a couple of weeks ago, golf aficionados all, wondered out loud about the reasons. Was it the economy? Changing family dynamics? A glut of golf courses? A surfeit of etiquette rules — like not letting people use their cellphones for the four hours it typically takes to play a round of 18 holes?

Or was it just the four hours?

Here on Long Island, where there are more than 100 private courses, golf course owners have tried various strategies: coupons and trial memberships, aggressive marketing for corporate and charity tournaments, and even some forays into the wedding business.

Rodney B. Warnick, a professor of recreation studies and tourism at the University of Massachusetts, said that the aging population of the United States was probably a part of the problem, too, and that “there is a younger generation that is just not as active.”

But golf, a sport of long-term investors — both those who buy the expensive equipment and those who build the princely estates on which it is played — has always seemed to exist in a world above the fray of shifting demographics. Not anymore.

Surveys sponsored by the foundation have asked players what keeps them away. “The answer is usually economic,” Mr. Kass said. “No time. Two jobs. Real wages not going up. Pensions going away. Corporate cutbacks in country club memberships — all that doom and gloom stuff.”

In many parts of the country, high expectations for a golf bonanza paralleling baby boomer retirements led to what is now considered a vast overbuilding of golf courses.

Between 1990 and 2003, developers built more than 3,000 new golf courses in the United States, bringing the total to about 16,000. Several hundred have closed in the last few years, most of them in Arizona, Florida, Michigan and South Carolina, according to the foundation.

“Years ago, men thought nothing of spending the whole day playing golf — maybe Saturday and Sunday both,” said Mr. Rocchio, the public relations consultant, who is also the New York regional director of the National Golf Course Owners Association. “Today, he is driving his kids to their soccer games. Maybe he’s playing a round early in the morning. But he has to get back home in time for lunch.”

This struck me as I thought about one of the things I see in my town's property tax assessments.  The private golf clubs have been given very generous (low) assessments.  Where surrounding land is selling for $400,000 per acre, the 3 private golf courses are assessed at $140,000 per acre (that's the 100% figure, not the CT 70%).

What a kind gift to give those who own or benefit from these private parks!  But I've got a real problem with asking the low-income homeowners of my town to subsidize those who  can afford expensive club memberships.  No, more precisely, I've got a problem with all the non-members -- probably 99% of the property-owners in town -- being asked to subsidize the club members. [And the golf course assessments aren't the worst assessment gift in my town.  I'll post on that one soon.]

One might argue that since this land does not send any children to the public schools, it should be entitled to favorable treatment.  (By that argument, the corporations and REITS who own the best land downtown should be given a sweet deal, too!)

Some might argue that this is "open space" which people want to see kept open (on a par with either the land owned by the [Australian] water company or the local conservation [not community] land trusts), and that the lovely views benefit the entire community.  Well, the landscaping may be lovely, but most of us are limited to viewing it as we drive by; we aren't welcome through the gates or over the stone walls without the specific invitation of a member.  And the amount of water that a well-groomed golf course uses, per acre -- drawn from our common water table -- likely exceeds what housing would use, and certainly the amount of fertilizer used to keep the greens green, and the amount of fuel used and pollution produced to keep the greens mowed -- and blown free of clippings and leaves -- is not inconsiderable.

Private parks should be assessed at their full value on the market, not given a special privilege, to be subsidized by working people who are only welcome on the premises as employees.  I'm not aware of a private golf club that is open to the general public even one day a year.

Shouldn't the members of the private clubs bear the full freight, without subsidy?  [Gee, that sounds something like the Lincoln quote I posted on yesterday!) Particularly at the point where fewer people are playing golf, and there are good public courses available (my town has 2), shouldn't we stop subsidizing them?

This is another reason why frequent reassessment of all the properties in town is a wise and just idea, and why all assessments should be readily available online.   Maryland reassesses 1/3 of its counties every year, so assessments are reasonably up to date.  Connecticut mandates every 4 years.  Some Pennsylvania and New York State towns haven't done a full revaluation in decades.

Cui bono? 

Comments

[Mason Gaffney]

The Los Angeles Country Club contains 39 holes, so its area is pushing 500 acres. Under California law, members-only golf clubs are assessed on capitalized income only - and a members-only club has little income to capitalize. Abutting the club's east side a 6-acre parcel sold last year for $1400 per square foot, a new record for L.A. To the south is Century City, with about the highest values p.s.f. in L.A. The land straddles Wilshire Blvd and extends north towards, if not to, Sunset Blvd and Beverly Hills - all prime locations.
Now, grab your calculator. $1,000 p.s.f. x 43,560 s.f. per acre x 500 acres comes to -- a lot of tax-exempt land value!

[lvtfan]

I'll do that math ... $43.56 million per acre (assuming a discount of about 30% off the comparable next door). An ordinary otherwise unprivileged mortal who buys a property like that will pay 1%* to 1.25%** of that amount each year in property taxes in California, the first year -- $435,600 to $544,500 -- per acre.

*1% is mandated by Proposition 13
** the additional 0.25% accounts for parcel taxes voted by local residents.

The next year, for the ordinary California-grandfathered-privileged landholder, no matter how much the market value of the property rose, his taxes would only rise 2%,*** to 444,312 to $555,390.

*** the 2% maximum increase is also mandated by Prop 13

But the membership of this and other private golf courses are not, of course, ordinary unprivileged or merely California-grandfather-privileged human beings, and therefore get to keep this huge private park as their own economic treasure, not subject to the taxes which would support the community.

And I'm willing to bet that most of the members are also major beneficiaries of Proposition 13 -- as homeowners and as business-people, because they are older, have owned their properties for extended periods of time, and tend to own property in the most valuable and fastest-appreciating locations.

There is more about special assessment for California's "non-profit" golf courses at http://www.boe.ca.gov/proptaxes/pdf/86_51.pdf.

Another example of how our system makes things so much easier for the wealthy and well-connected. (See also: the post on "Clawback") And yet they balk at measures that could benefit the people who are so generous to them!