Portland’s network of city-owned golf courses was supposed to earn enough to pay for itself. Instead, it has required bailouts to survive.
“Intended to be self-supporting, the program required an infusion of $800,000 of taxpayer funds in 2017 to remain solvent,” reads a report released today by the city’s auditor. “While Parks has taken steps to cut costs and increase the number of golfers, it is fighting a national trend of a sport in decline and past ineffective program management.”
The report detailed problems at the five city-owned golf courses (one of which is actually in the neighboring town of Beaverton). Like many government-owned pieces of infrastructure around the country, the courses suffer from deferred maintenance, poor oversight, and ballooning wage and benefit costs.
The annual budget for these city-run golf courses is $9.6 million. Some $1 million of this was spent administering the golf program. Another $3 million when to staff salaries and benefits, the largest single expense.
Ballooning staff costs were reportedly a driving factor behind that 2017 bailout of the golf courses. “Some conditions that led to the bailout remain and are projected to worsen, for instance, employee retirement and health benefits,” says the report, which also projects that those benefits will outpace inflation.
The golf courses have also apparently fallen into another common problem with government-run services: bold, debt-funded initiatives that suffer from cost overruns and disappointing revenue.
In 2014 the city bought the Colwood golf course, its fifth, with borrowed funds. The plan was to restore wetlands on a portion of the land and build a redesigned nine-hole course on another, which would then generate enough money to pay back the loans that financed the purchase.
Construction delays and disappointing earnings meant the city was unable to pay back these loans and was forced to refinance. Four of the five courses now generate enough business to cover their own operations, though not enough to pay for the city’s administrative costs. But the Colwood is still losing money.
Deferred maintenance on the courses has also turned off golfers, cutting down on revenue even more.
The report also notes golf’s waning popularity with the public—and suggests solving this problem through an effort to “increase the game’s appeal to more Portlanders, across age, gender, race, physical ability and more.” But rather than trying to sell minority communities on golf, the city could just sell the courses themselves. Indeed, the decline in the public’s love for the sport could be taken as hint that there isn’t a huge public purpose in maintaining a bunch of government-owned golf courses. Surely entrepreneurs in a growing, desirable city could fine better uses for the land.
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