On major legal, political and social issues California often functions as the leading edge for the nation, testing new ideas and signaling trends.
We believe that lessons learned recently in California in our ongoing fight against a substantial sales tax targeting golf (the Golf Tax) should especially be helpful to private clubs. Clubs across the country confront a broad variety of legal and regulatory issues on the state and local level, including water rights and restrictions, labor law compliance, mandatory sick and maternity leave, health care insurance, smoking bans and the like.
The California Golf Tax
In the fall of 2008 a genuine financial crisis loomed in California. Under pressure to find new tax dollars, revenuers in the state’s Finance Department chose to target the golf industry specifically as low-lying fruit: historically disunited, politically invisible, vulnerable because of a public image of affluence and unlikely to mount any meaningful opposition.
On Nov. 6, 2008, the governor announced the Golf Tax—a proposed sales and services tax of roughly 9 percent (more than 10 percent in Los Angeles) on previously untaxed dues, initiation fees and guest fees in clubs, and on cart rentals, green fees and golf lessons in all facilities, both public and private.
The Golf Tax created a fire drill in the California golf industry. To mount an opposition, existing institutions were forced to join together and they did so effectively.
Round one lasted until Feb. 23, 2009, when the governor signed legislation designed to resolve the budget deficit. The Golf Tax was not in that legislation, primarily, we believe, because of our effective political campaign.
When the February budget fix proved inadequate, the crisis returned as round two. At the end of July, round two ended when the governor signed new legislation to resolve the deficit, again without the Golf Tax.
Now we are ready for round three. We have met with the chair of a blue-ribbon commission appointed to address tax reform, which is scheduled to report to the legislature this fall. After receiving the commission’s report, the Legislature is expected to take up new revenue proposals, with golf likely to be targeted again in some way.
During this tax crisis California golf has been fortunate to have in place a trade association available to coordinate the industry’s advocacy efforts—the California Alliance for Golf (CAG), a nonprofit entity incorporated in 2007. CAG represents all California golfers and the golf industry, unifying them on issues of mutual interest. Its members include the Southern California and Northern California Golf Associations and the various associations that represent California superintendents, course owners and operators, managers, golf professionals, private clubs, women golfers and public links players, as well as retailers, suppliers, consultants and vendors to the industry.
No single golf organization or club group acting alone could accomplish the organizing, messaging and advocacy required to effectively oppose a proposal such as the Golf Tax. That effort requires help in the use of constituent rosters, e-mail lists, phone calls, financial support, and volunteer hours—in short, teamwork. For example, early on CAG needed and received valuable assistance from the National Club Association in the form of research on similar tax provisions affecting golf in the various states.
CAG could not have performed its advocacy work on these issues without major help and financial support from its constituents and especially from private clubs—in this case from the California State Club Association (CSCA) and its member clubs. In turn, CSCA could not accomplish its mission for its member clubs in major political matters without leveraging available resources of CAG.
Our favorable results so far have been an upset victory for the golf industry generally and especially for private clubs, who have the greatest financial exposure and most to lose if and when a substantial tax targeting golf is imposed.
Key Campaign Elements
Looking back, we now identify five critical elements that came together to produce an effective political campaign against the Golf Tax. We believe these same elements will be critical in organizing campaigns on other state and local legal/regulatory issues.
1. A strong, proactive lobby presence in the state capital
2. A professional public relations firm
3. A politically sophisticated, dedicated, interactive Web site
4. A single coordinating entity
5. A cooperative team with available resources to reach out to potential constituents
Thanks to our lobbyists, we were able to begin combating the Golf Tax within hours of its announcement. Fortunately, in 2007 CAG had engaged a governmental relations firm in Sacramento on a retainer basis to provide proactive lobby services and advice on pending and potential future matters of interest. Throughout, our lobbyists have given us timely and accurate intelligence, plus wise strategic advice.
Our public relations firm, engaged in December 2008, helped us focus the various political messages needed to energize our constituents and to inform and persuade government officials. One major goal was to combat erroneous public perceptions of who plays golf and who is adversely affected by a tax targeting golf. In fact, golfers are predominately public course players, including seniors and youth participating in community-based programs. In 2006 golf provided $6.9 billion in revenue to the California economy, supported 160,000 jobs in golf and related hospitality, retail and landscape employment, and produced $323.4 million in charitable giving. Our public relations people directed all forms of media to these and other compelling facts, induced favorable articles and editorials, and submitted the accumulated coverage to decision makers at the appropriate times.
Without a dedicated political Web site (www.forecalifornia.com) we likely would have failed irrespective of our other efforts. We registered more than 10,000 coalition supporters and were able to orchestrate meaningful, timely messaging to the governor and key legislators. Our coalition partners—with their Web sites, newsletters and e-mail blasts—served as conduits to get our messages to their constituents and to our potential supporters. Ultimately this is how we reached the individual golfers, more than 3 million in California. Going forward, CAG will continue to ask coalition partners to encourage their constituents to register on the Web site regarding such foreseeable issues as water allocations, funding of water infrastructure improvements, and environmental regulations.
The Importance of Coalitions
In 2009 CAG became a catalyst bringing together California golfers, golf-related businesses and allied organizations both to defeat the Golf Tax and to raise the industry’s profile as a vital economic driver, job creator and charitable contributor. CAG emerged as a national model for organizing golfers and the golf industry.
At a 2009 national golf course owners retreat in Monterey, California, CAG was recognized as a model for advocacy. It was noted that a similar Golf Industry Alliance for advocacy matters is emerging at the national level as a coalition of the national associations representing course owners, managers, superintendents, professionals and clubs. The primary goal is to create one voice to defend the industry. A major sub-goal is to shape the perception of golf in the court of public opinion.
CAG has been contacted by golf organizations in several states—Nevada, Oregon, Hawaii and Georgia—all interested in California’s experience with an alliance model to address industry issues.
Most recently, in July 2009, the Carolinas golf superintendents and course owners defeated a golf tax proposal in North Carolina using methods similar to CAG. Like CAG, they expect another golf tax proposal to reappear next year. Accordingly, they recently have asked CAG to assist in shaping a Carolinas Alliance for Golf.
From our perspective in California, we see a growing and enduring need for effective advocacy in both the golf and club industries. Necessity has forced CAG to identify several essential elements for success in advocacy.
The biggest challenge for CAG, and for all other alliance efforts on the state and national levels, will be to develop reliable models for sustainable funding. We have demonstrated that positive advocacy results are achievable in California, which hopefully will induce appropriate investments in future industry efforts across the country.