Florida municipal golf courses lose nearly $100 million in past 5 years

Sandridge Golf Course

Florida municipal golf courses lose nearly $100 million in past 5 years

Courses

Florida municipal golf courses lose nearly $100 million in past 5 years

Like orange groves, royal palms and Disney World, golf has long been part of Florida’s identity, and municipal golf courses have provided locals with affordable opportunities to play.

But as golf and local demographics change, many municipal courses are struggling with declining participation and revenue.

That change is forcing local governments to re-evaluate what role, if any, they should play in running golf courses.

Florida’s municipal golf courses have lost nearly $100 million over the past five years, an investigation by USA TODAY Network-Florida revealed, TCPalm.com reported.

While some dipped into reserves or found one-time sources of revenue, overall these county- and city-owned courses required $64.9 million in subsidies to stay afloat, the investigation showed.

Financial documents indicate that most municipal golf courses are set up as enterprise funds — or special funds that are expected to be self-sufficient — but only a handful of munis can actually cover their expenses.

The investigation also revealed that, increasingly, local governments are getting out of the golf business, or refusing the opportunity to jump into it.

Other findings from the investigation include:

  • Golf courses remain a priority for many cities and continue to receive a significant portion of the general-fund budget, despite being a drain on resources.
  • On many golf courses, participation is declining.
    Most municipal golf courses continue to pour millions of dollars into capital improvements, even though those courses consistently operated at a loss.
  • Some courses have accumulated serious debt that will hang over them for years to come.
  • Numerous courses have failed to address ballooning maintenance costs.
  • Several counties that hired third-party contractors to run their courses experienced significant mismanagement.

Sarasota City Commissioner Hagen Brody — like many elected officials in Florida — is conflicted about continuing to subsidize the city’s course, which lost nearly $3.7 million in the past five years. Next year it will need a nearly $1 million subsidy to make ends meet, according to city records.

Bobby Jones Golf Club is a product of demand from decades ago and is not necessarily viable in today’s golf market, according to Brody. And yet, Brody said, the course provides the city’s poorer residents the opportunity to play a round.

“Golf traditionally is an expensive sport to enjoy, but folks with limited means also should be able to enjoy a sport that’s really become a staple of Floridian society,” Brody said. “The goal is to provide access for people of all ages and incomes.”

Declining numbers

There are limits to the vibrant Florida golf market, particularly in the spring and summer, when snowbirds head back north and locals seek cooler, shadier activities, according to Richard Singer, National Golf Foundation director of consulting services, who frequently works with local governments.

And in recent years, the market — the number of people who play golf and the total golf rounds played per year — has decreased for many municipal golf courses, the USA TODAY Network-Florida investigation revealed.

In 2005, 30 million people in the United States stepped onto a golf course and played a round. By 2016, the most recently available data, that number had dropped to 23.8 million, according to the National Golf Foundation.

To remain competitive with Florida’s estimated 1,100 golf courses, including exclusive, private courses, some local governments pour money into course upkeep and beautification at a significant cost to taxpayers, the investigation revealed.

The Martin County Golf Course, for one, has lost nearly $6.6 million since 2015, when it took over the course, according to data provided by the county. And yet, the county is considering a $12.3 million project to build a clubhouse and partially redesign the course.

Financial success

Municipal governments tend to fall into two categories when it comes to subsidizing golf courses.

Some officials view their course as an amenity — something that enhances overall quality of life, like a park or a library — and are comfortable subsidizing the course, even if it is set up as an enterprise fund.

Others, though, “cannot stomach any subsidy,” Singer said. “They need to break even or turn a profit.”

Sandridge Golf Course in Indian River County is in the latter category, according to County Commissioner Joe Flescher.

“It gives the average Joe the opportunity to go play golf on a very high-quality course,” Flescher said, “but it has to live and die by the money it brings in.”

Sandridge has been $2.8 million in the black over the past five years, making it one of only a handful anywhere in Florida that has, in fact, been largely self sufficient.

Twenty years ago, Sandridge began outsourcing maintenance, a step that saves about $200,000 annually and has improved the appearance of the course, which is crucial in developing customer loyalty, according to Bela Nagy, director of golf.

“If you don’t have good greens, you aren’t going to stay in business very long,” Nagy said, adding that, still “there’s a budget, and we stay within fairly closely.”

About this investigation

The USA TODAY Network-Florida analysis of municipal golf course records was made through public-records requests and review of annual budgets. Revenue was calculated from all operating and miscellaneous revenue minus subsidies from other government funds. Interfund loans were excluded. Expenses include operating expenses, debt payments and major capital-improvement projects.

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