Plenty of waste to swing at

Government-subsidized golf underscores lack of fiscal discipline

Many observers across the state are decrying Gov. Gibbon's "bare-bones" Executive Budget. Assembly Speaker Barbara Buckley has hinted at the need for tax hikes, saying, "We are going to have to start on a new plan. This just won't work." All the indications from the big-government crowd are that there is nothing left to cut from government spending in Nevada, and, as a result, the legislature must approve tax hikes.

Speaker Buckley made it a point last week to highlight the fact that the governor's proposal to re-direct $79 million from Clark and Washoe County governments to the state general fund could adversely impact the operations of county government in those locales.

Apparently, one of the government operations she is trying to protect is government-subsidized golf. One of the most egregiously wasteful uses of tax dollars in Nevada channels public funds into taxpayer-subsidized golf courses. As privatization of these subsidized golf courses has not yet been proposed, one must assume that subsidizing golf is—in Speaker Buckley's view—an essential government function and must remain even when the budget is "cut to the bone." The notion is enough to make one second-guess what that expression means.

Entity/Year	Planned Subsidy	Actual Subsidy
City of Henderson
FY08	$1,768,857	$1,062,196
FY07	$2,128,465	$1,254,287
FY06	$1,620,675	$1,433,530
FY05	$296,994	$683,520
City of Las Vegas
FY07	$1,561,139	$960,086
FY06	$751,965	$856,920
RSCVA
FY08	$714,115	$741,338
FY07	$732,859	$480,110
FY06	$714,407	$547,879
FY05	$646,699	$646,156
Washoe County
FY08	$195,618	$95,771
FY07	$257,941	$23,757
FY06	$221,828	$183,828
FY05	$135,700	$328,757

Public entities such as the cities of Henderson and Las Vegas, Washoe County and the Reno-Sparks Convention and Visitors Authority all own and operate subsidized golf courses in Nevada. Government golf courses operate as "enterprise funds," which means that they are supposed to operate like a business.  However, each of the publicly owned golf courses has regularly operated at significant losses, and these losses have been made up with tax dollars. What's more, financial documents reveal that the government entities operating these golf courses have regularly planned to incur a loss—meaning the plan all along has been to force taxpayers to subsidize these golf courses.

Demographically, golfers are among the wealthiest Americans. The average household income of golfers exceeds $91,000 while 77 percent of golfers hold over $190,000 in investment portfolios. According to the U.S. Census Bureau, the median household income in Nevada is $53,912. Speaker Buckley has decried the fact that "Abused children are not getting served. Kids with heart problems are not getting operations." However, she has made no calls for curtailing the regressive subsidies that are given to wealthy golfers.

In 2007, subsidies for government golf courses in Nevada totaled $2.7 million, while in 2006 they totaled $3 million. While these annual amounts are small, they underscore the lack of fiscal discipline that continues to exist in Nevada. Few lawmakers have, as yet, voiced a willingness to implement true fiscal discipline despite the fact that NPRI has outlined a host of needed structural reforms in its recent "Recommendations for Cost-Cutting and Reform." Clearly, the goal of many lawmakers is not to ensure that Nevada citizens receive efficient, cost-effective service for their tax dollars, but really to grow the size of government.

If lawmakers were serious about setting spending priorities that would benefit education, healthcare, public safety or capital improvement, they would require the immediate privatization of government boondoggles such as subsidized golf courses. Nevada has no lack of privately owned golf courses. In fact, there would likely be even more if local governments were not operating to crowd them out with subsidized rates. 

Selling public courses to private owners could result in a significant infusion of tax dollars for state and local governments at a time when officials have complained of declining revenues. According to the most recent financial reports, public golf courses owned by the cities of Las Vegas and Henderson, Washoe County and the RSCVA are valued in excess of $40 million.

Taxpayer-subsidized golf is a poster-child for government waste in Nevada and is almost certainly only the tip of the iceberg. Lawmakers have no reason to bemoan the projected slight decline in tax revenues when local governments are wasting tax dollars frivolously.  Calls for new taxes should not even be considered until there is a serious effort to eliminate this wasteful spending.

Geoffrey Lawrence is a fiscal policy analyst at the Nevada Policy Research Institute.

Tags: Fiscal, Budget, Taxes