Under the headline of “Sacramento on the Mediterranean,” Mark Steyn links to a Wall Street Journal article on why “Building a golf course in Greece is a byzantine process:”
Much of Greece isn’t covered by zoning laws, so forestry experts have to pore over military aerial photos to figure out what land might be acceptable to develop. Then, because land is typically held in small lots, it’s sometimes necessary to buy up more than a thousand tracts.
After this, approval is needed from three sub-sections of Greece’s culture ministry—the Classical, the Byzantine and the Modern—plus an additional one devoted to underwater relics.
Finally, Greece is not yet geared to develop mixed-use resorts—with golf, villas and hotels—of the kind that might attract wealthy tourists. One developer, Spyros Tzoannos, said he had to accumulate some 2,000 government signatures for a complex of resorts in the Peloponnese.
“There is a matrix of laws and a whole list of approvals that deter many investors,” says Mr. Tzoannos, a director of Dolphin Capital Partners. “This maze does not only deter investors, but also overwhelms governmental employees as they, too, are often unsure of what needs to be done.”
The hurdles to building a golf course in Greece speak to the country’s broader economic problems and, in particular, how Athens hasn’t been able to capitalize on the country’s rich natural environment to earn some badly-needed money.
Like other southern European countries, Greece’s sunny Mediterranean coastline is a perfect backdrop for golf courses, which bring in high-paying tourists. The demographics also are appealing to investors. With the retirement of the European baby boomers, there’s likely to be more north-to-south migration.
Yet Greece has only six full-size courses, compared with nearby Spain, which has more than 300. Greece depends heavily on tourism, but so far its idyllic islands tend to attract young people looking for cheap drinks.
“We need jobs and we need investment,” says Peter Doukas, president of the Hellenic Golf Federation. “It’s an economic necessity.”
Dolphin thinks it will start building its golf course in late 2011 or in 2012, seven years after the company was formed to move forward with this and other projects.
While I don’t know what the golf courses are like in fiscally and morally bankrupt Sacramento, I do know that Thomas Sowell wrote a great piece back in early 2007 on San Francisco’s numerous municipal golf courses, or as he put it, “Par for the Big-Government Course:”
San Francisco has six municipal golf courses — and they are losing money. Now there is all sorts of hand-wringing over what to do about it.
An economist might see this as a non-problem. If the golf courses are losing money, then get rid of them. Given San Francisco’s sky-high land prices, selling the land that the golf courses are on would bring in millions, if not billions, of dollars.
But such advice is why so few economists get elected to political office.
A politician has to be all things to all people — a friend of the golfers, a protector of the workers who maintain the golf courses, and of course a believer in mother and apple pie.
Even the suggestion that the golf courses might be turned over to some private operator of golf courses has caused opposition. One golfer declared: “Privatization would raise greens fees. Nobody could afford it.”
This is the kind of talk that has to be taken seriously by elected officials, even if an economist would dismiss it as sheer nonsense. Have you ever heard of any business raising its prices to the point where it no longer had any customers?
Obviously, what “Nobody could afford it” really means is that this particular golfer and others like him might not be willing to pay it. But that is the whole point of prices — to determine where resources go when different people want to use the same resources for different purposes and have to bid against each other.
If you put San Francisco’s golf courses on the open market, in a city with a serious housing shortage and sky high housing prices, chances are good that the land occupied by golf courses would quickly be bid away by those who would build some much-needed housing.
Of course, this would make the city’s municipal-golf-course workers unhappy. And unhappy municipal workers can be a big problem for a politician, especially if these are union workers.
How have San Francisco’s golf courses been kept going when they cost more to maintain than they are receiving in fees from the golfers who use them? Recent renovations alone cost more than $23 million.
But as I said, that was early 2007; what’s going on with San Francisco’s city-owned golf courses nearly four years later?
After doing exhaustive research (aka, a quick Google search), I came across a June 2010 article in the SF Weekly (an alternative paper even further to the left that the flatfooted San Francisco Chronicle) titled “Bleeding Green — Forget about Sharp Park’s endangered frogs and snakes. The real problem with the golf course is its enormous cost to the city:”
Sharp Park Golf Course, in other words, is remarkably affordable to those who play it. To the city of San Francisco, which owns the course and is responsible for its management and upkeep, it is anything but.
In recent years, the course has been at the center of a roiling environmental debate that has pitted golfers and golf advocates against activists who want to see the course bulldozed and restored to wilderness. The unwitting instigators of this battle have been two creatures that call Sharp Park home: the San Francisco garter snake and the California red-legged frog. Both are protected under the federal Endangered Species Act, and environmentalists have gathered evidence that both have been harmed by careless maintenance operations — lawn-mowing, flood control — at the course.
In December, the San Francisco Recreation and Park Commission approved an apparent compromise when it adopted a plan that calls for keeping 18 holes of golf at Sharp Park while realigning parts of the course to create more habitat for the frog and snake. Rec and Park general manager Phil Ginsburg triumphantly announced in a Nov. 6 letter to city officials that the endangered species “can not only survive, but also flourish at Sharp Park” without impinging on the activities of golfers. This solution appeased golf advocates even as it frustrated environmental activists, and its wisdom, from the perspective of species conservation, is still in dispute.
However, one of the most important consequences of keeping Sharp Park operating — the financial burden it poses to San Francisco and its taxpayers — wasn’t fully explained. According to government records and interviews with officials in San Francisco and San Mateo County, the total minimum investment Sharp Park requires will range from at least $17 million to $23.4 million or higher — roughly twice as much as Rec and Park officials acknowledged in their report. It’s a staggering amount, exceeding even the cost of the landmark 2003 renovation of San Francisco’s Harding Park, a premier public golf course that last year hosted the prestigious Presidents Cup tournament.
In a time when depleted government coffers are forcing the park department to consider slashing basic services — and when the city as a whole faces a $483 million budget shortfall — is Sharp Park worth it? That depends on whom you ask, but some surprisingly prominent voices have singled it out as a waste of money. In December, $2 million in grants devoted to improving the course’s water system was highlighted in a report by Republican Senators John McCain (Ariz.) and Tom Coburn (Okla.) on misallocated federal stimulus funds. (“Water Pipeline to a Money-Losing Golf Course,” the headline read over the entry.)
Outside funding sources, from the federal government or from public agencies in San Mateo County, might eventually become available to defray the full cost of preserving cheap municipal golf at Sharp Park. To date, however, such income streams have not materialized, and some think San Francisco residents remain uninformed about the full fiscal burden the golf course poses.
“That [Recreation and Park Department] report, even though it was a good first step, it was very incomplete, in my estimation,” says Supervisor Ross Mirkarimi, who has sought to draw attention to the financial realities involved in keeping Sharp Park open. “It did not give a full estimate — not only of the upfront costs, but of the long-term capital costs. People shouldn’t be fearful of that discussion.”
For several reasons, however, the discussion is a complicated one, involving multiple layers of state and federal government regulations and a hotly contested body of scientific evidence on the fate of Sharp Park’s nonhuman inhabitants.
And there you have it: forget about privatizing the course or relieving San Francisco’s lack of affordable real estate; the choices come down government-managed golf or garter snakes.
Incidentally, speaking of Thomas Sowell, don’t miss the Fourth and latest edition of his magnum opus Basic Economics treatise. Something tells me it’s not been widely read in San Francisco, Sacramento, or Greece.