Municipal golf has many images. To some, the “muni” is a low cost, high value golf solution. To non-golfers the local muni is perceived (sometimes true) as a drain on public finances that serves a small portion of the community (the golfing population) and possibly more patrons from outside the town borders. The politics of municipal golf is often centered on whether the course is profitable or not, if and how much the municipality subsidizes it and what benefits the community and the non-golfing population receives. The question of whether the site could be put to a better use is often raised. There are often differing views of these issues.
Municipal golf courses are often “political footballs” that pit a community’s golfing population against the broader community, especially, if the golf course can’t maintain fiscal independence. While some communities develop, acquire and maintain golf courses to provide a recreational amenity to the community, others treat it like a business, avoid discounts for residents and seek to generate a profit, used either for mitigating a deficit somewhere else or funding capital improvements at the golf course.
The most prominent image of municipal golf is of one located in an urban area, sometimes in an undesirable neighborhood surrounded by security fencing, often in disrepair. For sure, there are many “munis” in similar locations. However, municipal golf, like all daily-fee golf is location sensitive. Simply put, there needs to be sufficient population surrounding any golf facility (public or private) to support it unless it’s a destination. There are numerous examples of all types of golf courses developed in sparsely populated locales, often on cheap land that never make it. Municipal golf is a not-for-profit enterprise, and thus, often has some advantages for the golfer and the operator, who can either be the municipality or a third-party lessee or manager. In many cases, municipal golf courses are exempt from real estate taxes, something for-profit operators often lament. This significant expense relief allows municipal courses to compete at potentially lower fees. Conversely, municipal golf courses sometimes contend with a mandated minimum wage or union organized labor which can add a financial burden.
Golf Property Analysts is currently involved in an assignment where these and other issues are being examined to help set a path forward for the town’s golf facility. We’ll examine whether the course is currently generating its “fair-share” of rounds based on a market analysis. Located in a destination resort area and adjacent to premium lodging, we’ll evaluate not only how many rounds are being played, but by whom. We’ll study the impact of discounted “resident” rates and consider if and how some of the site may be better utilized.
An often prominent issue with most municipal golf courses is whether it should be run as a business to maximize revenues and profit, or if it should serve as a subsidized recreational amenity for the community. This is always a tough decision for local governmental officials charged with stewardship of the course. There are competing forces at work. With golf participation typically below 10% of the adult population in most communities, subsidizing residents’ golf with favorable resident rates obviously makes local golfers happy. If the course isn’t profitable, those that don’t play golf ask why the town is paying the freight. An intangible exists when one raises the question of benefits (often real but also intangible) to the town as a whole, including non-golfers. Does the golf course improve quality of life? Does it help attract businesses and residents, thereby enhancing property values and increasing the local tax base? Does the course attract visitors injecting additional funds into the local economy? In the case of our assignment, there is also the question of whether (all or some of) the land could be put to a “higher and better” use that might be both economically and socially attractive to a wider segment of the population.
Municipal golf courses come in many variants. Some are upscale facilities that compete at the high end and serve as a calling card for the town and an attraction. Some are very simple and designed to provide low cost golf to the greatest number of people. It has been said that municipal golf “democratized” the game back in 1895 with the opening of Van Cortlandt Park in New York City. What was then a game for the aristocracy, over time has become more a game of the people, with over 80% of rounds played being at public access courses. Municipal golf will likely continue as a political debate in those communities with courses and the stakeholders will continue the debate the ultimate goals of the course.