Coatesville has been trying since 1999 to take the land of Dick and Nancy Saha to build a golf course as part of a regional recreational center. As of December, the city had spent all of the proceeds of a $5 million bond on land acquisition, engineering and design studies, and more than $1 million in legal fees. Now negotiations with the Sahas are at an impasse.
In its infinite wisdom, the City Council last month approved putting a referendum on the November ballot that asks Coatesville residents to decide whether the city "shall proceed" with a proposed revitalization plan and the recreation center and golf course.
In considering the issue, Coatesville voters should ask themselves two questions:
Is a municipal golf course the proper function of local government?
Is there demand in the area for another 18-hole course?
The first question is soon to be litigated in Chester County Court, where the Pennsylvania Golf Course Owners Association and several people are suing Coatesville. They contend that the city is prohibited from any activity not expressly authorized by the state that results in competition with private enterprise. A hearing has not yet been scheduled.
On the second question, there's plenty of data to look at.
A survey this year by Jeff Broadbelt, president of Agrostis Golf Management, showed that there are at least 30 public "daily fee" golf courses within 20 miles of Coatesville. Agrostis manages two such courses - Downingtown Country Club and Ingleside Golf Club in Thorndale.
Statistics from the National Golf Foundation in Jupiter, Fla., show that the total number of rounds played in the United States has declined from approximately 518 million in 2000 to approximately 495 million in 2003.
The same group's feasibility study led Bayonne, N.J., to drop the idea of building a municipal golf course. As Mayor Joseph V. Doria Jr. told the New York Times, the foundation "concluded that it would be economically suicidal for Bayonne to get into the golf course business." Instead, Doria was able to negotiate discounted fees at local golf courses for Bayonne residents.
Two further examples of the current market for golf courses also come from New Jersey.
Evesham, in Burlington County, is still digging out from a disastrous 2003 at its municipal course. After three decades of financial success and no drag on taxpayers, the township had to dip into its open-space fund for $750,000 to make an annual bond payment of about $875,000. The golf course also posted an annual operating deficit of $900,000. The culprits were bad management, overly ambitious capital improvements, and a 35 percent drop in rounds played during the year. This year, however, business is improving and management is optimistic.
Coatesville officials should also look at Blue Heron Pines East in Atlantic County, N.J. - considered one of the best public (though not municipally owned) courses in that region. After four years, it is losing money and may be sold and converted into an age-restricted community with a nine-hole golf course. The reason? Not enough paying customers, according to published reports.
Closer to home, Lower Makefield in Bucks County opened a $16 million golf course on July 1. Township supervisors hope that the course generates sufficient revenue to repay the $15.9 million loan, as well as cover course expenses, which include a $7,500 monthly management fee to KemperSports for this year.
With more golf courses competing for a pool of golfers that's been shrinking in recent years, it's clear that some will fail and go out of business. That's the nature of free enterprise.
A municipal golf course, however, has an alternative not available to private owners: If it loses money, taxpayers can make up the deficit through increased taxes. Is this fair to taxpayers? Or to the private owners who have invested millions in their daily-fee courses near Coatesville?
Coatesville officials should concentrate their efforts on the worthy goal of revitalization of what has been a depressed city. They should abandon their costly and wrongheaded notion that a golf course is a vital element in that revitalization. And they have no business venturing into competition with privately owned courses.
Source: Philadelphia Inquirer