SACRAMENTO — Teed off at Gov. Arnold Schwarzenegger’s proposal to tax their game, golf course owners, pros and superintendents are mobilizing like never before.
They’ve got a lobbyist, launched a Web site and rallied course owners across the state, including in the Valley — all in an attempt to stop the proposed sales tax on golf, an activity that long has been exempt along with other sports and services.
It’s a new game for golfers, who have lobbied before but never to this extent.
Gary Elliott, chipping balls at Airways Public Golf Course in Fresno, opposes Gov. Arnold Schwarzenegger’s proposed sales tax on greens fees, saying it would have a Band-Aid effect on the state’s budget crisis.
Die-hard golfer Jeff Lang says a proposed sales tax on greens fees wouldn’t stop him from playing.
“It’s an immediate, major issue,” said Bob Bouchier, executive director of the California Alliance for Golf, the trade group behind ForeCalifornia.com. “Every single part of the industry is adversely affected by this.”
The governor also wants to broaden the sales tax to include repairs to appliances, furniture and vehicles, as well as veterinarian services, starting March 1. The golf tax would start April 1, along with new taxes on amusement parks and sporting events.
The expanded tax would raise more than $1 billion a year in 2009-10, according to the governor’s Department of Finance. Schwarzenegger also is calling for a temporary 1.5-cent increase in all sales taxes.
The extra revenue is needed to help close a projected state budget deficit of more than $41 billion through June 2010, Schwarzenegger administration officials say.
“You can make the argument that there is no good time to raise taxes. But that said, we cannot close this gap with [spending] cuts alone,” said H.D. Palmer, a department spokesman.
Republicans have long opposed any new taxes, although there is growing consensus in the Legislature that at least some new taxes or fees will be part of a budget deal.
The GOP-aligned California Chamber of Commerce opposes tax increases that target specific industries — like the golf tax — but has expressed at least some support for a broader tax increase.
“If there are going to be tax increases, [they] need to be spread as much as possible to minimize the economic harm,” chamber President and CEO Allan Zaremberg said by e-mail.
California taxes fewer services compared with other states — only 21 out of a possible 162 services, according to a survey by the Federation of Tax Administrators. By taxing more services, the state would create a more reliable revenue stream in today’s service-oriented economy, state finance officials say.
But the push-back by golfers, as well as by sporting and tourism industries, shows that almost any tax proposal faces strong political headwinds.
“The governor definitely got their attention, there’s no doubt,” said state Sen. Dean Florez, D-Shafter. “And it’s brought different people into our office than we [normally] see.”
For instance, Florez said he has been lobbied by the Golden State Warriors, the professional basketball franchise, which would be affected by an extension of the sales tax to sporting events.
The golf industry says it is being unfairly targeted. Other recreational activities, such as skiing, are not on the tax list. Plus, golf leaders say now is not the time to raise taxes, because courses already are suffering from the recession.
The tax would apply to greens fees, driving-range fees, cart rentals and monthly dues at private clubs.
At Hank’s Par 3 & Driving Range, a public course in Fresno, business is down by 30%, said Hank and Nancy Bocchini, the husband-and-wife team who own the course. Greens fees there are among the cheapest in the state — $10 for nine holes on a weekday.
Under the governor’s proposal, Fresno’s sales tax would jump from 7.975% to 9.475%. And if golf were included, Hank’s greens fees would go up by nearly a dollar — unless the course decided to lower prices and eat the cost. It doesn’t sound like much, but every bit counts for the working-class golfers who play there, Hank Bocchini said.
“It would hurt, I just know that,” he said.
At the private Sunnyside Country Club, the sales tax would add $455 to the yearly membership dues of $4,800.
Steve Menchinella, the club’s golf pro and general manger, said membership has dropped from 440 to 360 in the past year. “If everything’s taxed, it’s just going to run more people away,” he said.
But some tax experts say golf, and other industries, have gotten a free ride for too long.
Rental cars are taxed, but golf carts aren’t, points out Lenny Goldberg, executive director of the California Tax Reform Association, a union-backed advocacy group.
“There are many, many inconsistencies” in the tax code, said Goldberg, an avid golfer.
Still, Goldberg said if golf is taxed, other services also should be added.
The governor is “right to be taxing a round of golf — but he’s selected out things with no apparent rationale.”