Residents of Beavercreek, Centerville, Miamisburg and Springboro will have more than $3.8 million of their tax dollars spent this year to pay down the debts of their municipal golf courses.
Depending on the weather, more tax money could flow from the cities’ general funds — which pays for the day-to-day operations — to cover operational losses of the golf courses. That money is roughly equivalent to the cost of repaving more than 57 miles of road each year.
They are expenses that the communities took on years ago with the hope of spurring residential development. The courses have produced several thousand new housing units that have added to the tax rolls.
Residents of those communities are not alone in their subsidies of their municipal courses. A 2011 analysis of golf operations in 13 area cities by the Dayton Daily News found only one — the city of Dayton’s — made money in 2010. The rest ran a deficit when operations and debt are taken together.
The four high-end courses in Beavercreek, Centerville, Miamisburg and Springboro all opened within five years in the mid-1990s during a nationwide explosion in golf course construction.
Research published in PGA Magazine estimated the equivalent of more than 2,400 18-hole golf courses were constructed between 1995 and 2004 with no corresponding increase in demand.
“It was around that time that local governments were developing golf courses to enhance the cities’ tax base. The thinking was the new housing that came with the golf course would provide a good revenue stream,” said Jack Dustin, director of Wright State University’s Center for Urban and Public Affairs. “The question was how you run them, and can you do it profitably with a huge debt load?”
All four courses succeeded in creating new housing, but not without some heartaches for elected officials.
Beavercreek taxpayers will pay just over $1 million this year to keep the Beavercreek Golf Club operating and not default on the revenue bonds issued to fund the golf course’s construction.
Taxpayer concern about the continued subsidy of the golf club and its debt has plagued city council since ground was broken in 1994. The final bonds will not be retired until 2028.
“We had three separate golf consultants come in. All came to the conclusion that the course would be very viable,” said Jerry Petrak, current vice mayor who served on the council that approved the project. “In retrospect, they were wrong.”
Added longtime council member and non-golfer Scott Hadley, “It turns my stomach. But it really is an excellent course, I’m told, and an excellent facility.”
Some residents question why the community needed a golf course when other services aren’t provided by the city.
“Beavercreek is one of the few cities that doesn’t have water, doesn’t have sewer, doesn’t have a fire department, but it has a golf course,” said city resident Robert Sharp, a retired government accountant.
The city’s water and sewer is supplied by Greene County and fire protection by Beavercreek Twp.
“It’s never made money. It’s not like a park that everybody paid for and everybody can use. Everybody paid for the golf course, but it will cost you to use it,” Sharp said.
Still, the $10.8 million, 412-acre development has fulfilled what city fathers were hoping for: increasing the city’s housing stock. Jeff McGrath, city planning director, said the development is around 90 percent complete with 695 housing units constructed, ranging in price from $750,000 for the high-end single family house to $250,000 for the least expensive condo.
“At the time the course was built, the typical housing in Beavercreek was half-acre lots with single family houses,” said Mike Self, a 27-year veteran of the city planning commission. “There were few condos and few high-end housing on smaller lots.”
Self said the golf course spurred those types of development both on the course and in the surrounding area. Those housing types are attractive to empty-nesters “who are tired of maintaining half an acre. I have friends who retired and moved to condos rather than leave the city. They are tickled to death,” he said.
The other three cities have seen the same housing growth.
- Centerville taxpayers will pay $2.1 million toward the debt on the Golf Club at Yankee Trace, which will be retired around 2017-18. City Manager Greg Horn points to the $300 million in residential development of the 900 homes on Yankee Trace since the course opened in 1994. “I do believe future generations will be pleased that we took on this extremely ambitious program.” This year, the city will pay $5.7 million toward the debt. Of that, $3.6 million comes from the sale of land over the years to developers and $2.1 from the general fund. The part of the general fund money is coming from the final year of the estate tax. The course opened in 1994.
- Springboro taxpayers will pay $260,000 this toward Heatherwoode Golf Club’s debt, which will be retired in 2018. “It was,” Christine Thompson, Springboro city manager, said of the Heatherwoode’s development, “the municipal thing du jour. It was, ‘Let’s sell land for housing around the golf course to pay for the golf course.’ But it doesn’t really work that way. Over the 25 years, there has been no lack of pain. There have been plenty of trials and tribulations … I think you have to look at (a golf course) the same way as a subdivision or a retail node. It’s a positive for the community.” The course opened in 1991
- Miamisburg taxpayers are spending $320,000 toward Pipestone Golf Course debt, which stood at $3.4 million at the start of the year. That debt will be retired in 2021. “It was not all about economics,” said Gary Giles, the city’s spokesman. “There was community pride, community image. The course has been a long-term asset to the city and a benefit to the residents.” The course opened in 1992.