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Plenty of waste to swing at

| January 29, 2009

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.

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Geoffrey Lawrence is director of research at Nevada Policy. Lawrence has broad experience as a financial executive in the public and private sectors and as a think tank analyst. Lawrence has been Chief Financial Officer of several growth-stage and publicly traded manufacturing companies and managed all financial reporting, internal control, and external compliance efforts with regulatory agencies including the U.S. Securities and Exchange Commission.  Lawrence has also served as the senior appointee to the Nevada State Controller’s Office, where he oversaw the state’s external financial reporting, covering nearly $10 billion in annual transactions. During each year of Lawrence’s tenure, the state received the Certificate of Achievement for Excellence in Financial Reporting Award from the Government Finance Officers’ Association. From 2008 to 2014, Lawrence was director of research and legislative affairs at Nevada Policy and helped the institute develop its platform of ideas to advance and defend a free society.  Lawrence has also written for the Cato Institute and the Heritage Foundation, with particular expertise in state budgets and labor economics.  He was delighted at the opportunity to return to Nevada Policy in 2022 while concurrently serving as research director at the Reason Foundation. Lawrence holds an M.A. in international economics from American University in Washington, D.C., an M.S. and a B.S. in accounting from Western Governors University, and a B.A. in international relations from the University of North Carolina at Pembroke.  He lives in Las Vegas with his beautiful wife, Jenna, and their two kids, Carson Hayek and Sage Aynne.

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