September 19, 2010

Utah County alone has shed 16,738 jobs since September 2008. Demand at the Provo food bank has doubled. Families are hurting.

In that same time, some local cities have been forcing families to subsidize golf with their taxes, and even their utility bills. Many of those cities have spent years flushing large amounts of taxpayer cash into their in-the-red golf courses.

In fiscal year 2010 (which ended June 30), Utah Valley cities used more than $1 million in taxes to subsidize golf courses that are bleeding cash. And if you think these struggling golf courses are just temporary victims of the economy, think again. Even when the economy was flush, many local public golf courses required yearly bailouts.

Some local golf courses have been getting bailouts for decades.

“It makes no sense,” said Royce Van Tassell of the Utah Taxpayers Association. “We have long felt that it is entirely inappropriate for cities, counties and the state to subsidize rounds of golf with taxpayer dollars. The cities, counties and state have no business running their own golf courses.”

The cities say they view the golf courses as amenities for residents, just like libraries and pools.

For the past two months, the Daily Herald has been using government records requests to get cities to divulge their golf subsidies to residents — and even with that effort, one city, Cedar Hills, did not comply.

Most cities have already budgeted their golf subsidies for fiscal year 2011, which started July 1, even as the number of city fees mushroom and services such as library hours are slashed. And in several cases, cities — including Lehi and American Fork — are planning larger bailouts than in 2010.

The expenditures are a sign that public officials have lost sight of the job of government, said Van Tassell.

“Cities exist to maintain law and order,” he said. “Not to make sure people can play cheap rounds of golf.”

Change will not come until resident make it clear to elected officials that taxpayer money should not be used for golf, he said.

“Residents need to make sure their elected officials understand that, especially in these economic times, government needs to be focusing on their core purposes,” Van Tassell said. “They should not be doing commercial activities. They should not be subsidizing golf.”

Subsidies for local golf courses

Public ire over golf subsidies has perhaps been the loudest in Cedar Hills over the past several years, and during the course of those years the Daily Herald has repeatedly asked the city to provide a history of the city’s bailouts to its golf course, which private developers benefited heavily from before leaving the city with the bill. Cedar Hills has never provided the public with the requested history, and that did not change in response to requests for this article, though both city manager Konrad Hildebrandt and Mayor Eric Richardson promised to be forthcoming.

But Richardson has not returned any calls from the Daily Herald since federal officials named him — but did not charge him — as part of a fraud investigation.

Provo officials told the Daily Herald it will work to reduce its golf subsidy for its East Bay Golf Course from $300,000 to $100,000 next year by replacing one full-time position with a part-time position, reducing the golf course’s operating budget and not doing any construction. The last year the golf course did not require any city subsidy was 2005, said Helen Anderson, Provo’s spokeswoman.

Pleasant Grove, American Fork and Lehi share ownership of Fox Hollow Golf Course. In 2010 Fox Hollow had the dubious distinction of losing more money than any other public golf course in Utah Valley.

“I do not know when, if ever, the course has been profitable,” said Pleasant Grove Mayor Bruce Call. “We view it as an amenity to our citizens, similar to our swimming pool, our library, our recreation center and our parks, none of which are profit centers for Pleasant Grove, and all of which are supported with taxpayer funds. In fiscal year 2010, Pleasant Grove covered $209,980 as our share of the shortfall.”

Lehi alone has put $500,000 of taxpayer funds into Fox Hollow over the past three years, and plans an even larger subsidy — $245,000 — in 2011.

Lehi city manager Jamie Davidson said all three cities “have made great efforts to contain costs. The course operates with a minimal corps of just two full-time employees. All other employees are either part-time or seasonal workers.”

American Fork has sunk $545,000 into its share of subsidies for Fox Hollow in the past three years, and projects to pay another $225,000 next year alone. Meanwhile the city has slashed the number of hours the library is open, citing budget shortfalls.

Spanish Fork told the Daily Herald it is taking money from residential utility bills to bail out its in-the-red golf course. The city said its 2010 subsidy was $173,000, but in a small notice to residents in the city newsletter, the city said it was taking $250,000 from electric bills and transferring that money to keep the golf course solvent.

The Utah Taxpayers Association did not mince words about this transfer.

“What they are doing there is trying to hide it, that’s what it looks like when we see those kinds of transfers as an association,” said Van Tassell of the Taxpayers Association. “We become very concerned that local elected officials are trying to avoid transparency in the tax system and trying to hide it by increasing utility fees. Those utility customers are buying utilities, not subsidizing rounds of golf.”

Meanwhile, Spanish Fork has been working for four years to try to reduce the subsidy, said Seth Perrins, assistant city manager. The last time the golf course operated without a taxpayer subsidy was “sometime in the early to mid-1990s,” said Perrins.

Payson spent $315,000 to bail out its golf course, the largest amount spent by any single city in 2010. Officials project the course will require another $210,000 in 2011, even after cutting one salaried position.

The course has never operated in the black.

“We view Gladstan golf course as not only a recreational activity but an economic development tool and a quality of life amenity,” said Payson city manager Rich Nelson in an e-mail to the Daily Herald. “Please come down and play a round. It is the most beautiful golf course in Utah.

“Payson’s plan is and always has been to sell excess land around the golf course” to pay off the city’s debt on the golf course, said Nelson, noting that has not been feasible so far.

Not every city lost money on their golf course this year.

Springville’s Hobble Creek Golf Course put a profit of $36,500 into the city’s coffers, said Mayor Wilford Clyde. The city did not respond to the Daily Herald’s request for information about any history of subsidies for the golf course.

Eagle Mountain last year took over a golf course from a struggling subdivision, but demanded and got a $300,000 cash infusion to go with the land transfer. The city immediately hired the same company that manages the Thanksgiving Point golf course to take over.

Orem owns the land at the Sleepy Ridge Golf Course and leases the ground to a golf management company. Orem subsidizes irrigation water to the course by providing it at wholesale rates, but the city has no debt on the property and does not give any other subsidies to golf.

“The city has not made any payments to the golf course or operator in any fiscal year to subsidize the course,” said city manager Jim Reams.

• Caleb Warnock can be reached at [email protected].

Taxpayer bailouts to local golf courses in 2010:

Provo: $293,696

Pleasant Grove: $209,980

Spanish Fork: $173,383 from electric rates.

Lehi: $195,080

American Fork: $201,000

Payson: $315,000