From my perch analyzing the economics of golf courses and clubs on a daily basis, I see and learn many ways that the golf business succeeds and struggles and try to help our clients make sound decisions to enhance their profitability. Sometimes, the economic goals cross paths with both social (DEI) and environmental goals that can create a win, win situation. Recently, while chatting with Steve Mona of the American Golf Industry Coalition (AGIC) about the upcoming 2023 National Golf Day (NGD), I hatched an idea that I think golf should promote.
NGD is a day held each year where golf industry leaders travel to Washington, DC and visit members of the US Senate and House of Representatives to promote the many virtues of golf. Not surprisingly, there are several members of Congress who support the game’s efforts – on numerous fronts – but we can always use more support.
As we all know, water is becoming a more and more precious resource and is critical to the success of any golf facility as a lifeline for the course’s turfgrass maintenance. In some locations, water is not only scarce, but expensive. We have one client – not in a desert area – that spends $1.5 million per year for irrigation water. In the desert southwest, high water cost is not uncommon. With Net Operating Income (NOI) multiples of 9-10, it doesn’t take sophisticated science to calculate the impact on property value or profitability.
Back in October, I spoke with Scott DeBolt of DLF Seed about the modern turfgrass varieties and some of their characteristics relating to water usage and other inputs. While speaking with Mona about AGIC’s lobbying efforts, it dawned on me that there might be a way the golf industry can work with government for the benefit of not only clubs seeking an improved bottom line but also environmental interests seeking to preserve our planet.
What if (I thought) the federal government offered tax credits to golf facilities that converted to turfgrass varieties that use less water, chemicals and other resources? There are tax credit incentives for electric cars and tax incentives for other types of investments. Why not golf? It seems like a win, win. From a political perspective, those who focus on environmental issues would be happy with the positive environmental impact. For those who focus on business incentives, the turf and golf course industries would benefit from additional business and lower golf course maintenance costs. Golfers could also conceivably benefit from the potential for lower dues and green fees as a result of the maintenance cost savings realized.
It’s not often that there’s an idea that both sides of the political “aisle” can agree on, but I think this is one. Business wins. The environment wins. The game of golf wins. When I go to NGD in May, I will most certainly be promoting this idea and plan to write my representatives about it soon.