From Deseret News archives:

Green space, black holes: Subsidized golf courses costing cities, taxpayers

Published: Tuesday, Aug. 23, 2005 10:40 a.m. MDT
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In July 1999, a year after the course opened, Salt Lake County bought it for $15 million. The county auditor later concluded that the course had an appraised value of $12 million at the time of purchase.

"The course was already there. A private corporation was already doing it," says Joe Watts, president of the Utah Golf Association. "Why would the government bail them out? Why would they take $15 million of taxpayer money?"

In Cedar Hills, Zions Bank officials were also skeptical of the golf course proposal. If the tiny town really wanted to build a course in an already saturated market, it would have to put its public safety building up as collateral.

But Mayor Brad Sears — a real estate developer and avid golfer — saw the course as a potential cash cow. The city had virtually no business-tax base and badly needed the revenue a golf course would provide, he said.

In fact, a consulting firm told city officials they could expect to make $150,000 a year on the course in its first 10 years. After that, the city would see profits of $400,000 annually.

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Armed with this information, the city plowed forward, until former councilman Ken Cromar circulated a petition that demanded the matter go before the public. (Widely considered an activist in Cedar Hills, Cromar would later lead the fight to keep stores there closed on Sundays and beer out of the stores.)

In a letter to Cedar Hills residents, Sears urged them to vote for the $6.4 million course. He called it a great opportunity for the city. "According to the experts, the golf course will be successful," he said.

But who were the experts?

One was the city's financial adviser, Zion Bank. The bank would later lend the city the money to build the course. Another was the course designer.

But the city put the most stock in a study done by a Denver consulting firm called THK, which concluded that there was a "pent-up demand" in Utah County for more courses.

No one seemed to mind that THK was also working for the developer on the project.

"It may have appeared to be a conflict of interest," Sears says now. "But anyone I dealt with in the process dealt with the city earnestly. Mistakes were made, but they were honest mistakes."

The city also hired an independent appraiser, Sears says, who confirmed what THK had told them — that the course would make money.

What Sears didn't say in his letter to residents is that the course would initially lose money. Others did, including Fotheringham and Cromar, but the measure passed anyway — by a mere 47 votes.

That was May 2001. By August of the next year, property taxes had skyrocketed by 37 percent. Residents were outraged.

"Where are our priorities?" resident Brad Creer asked the City Council. "I love to golf, but I have six kids. My priority in life right now is not to golf."

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Golfers putt at East Bay Golf Course's second hole. The state has experienced a golf-course building boom.

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