June 3, 2008

Municipal Bonds

Bethpage Black was just the beginning. Public courses are now part of the USGA's Open mix. It's good for the game—and business

For many americans the very word golf suggests a Smails-ian world of clubby elites. Golf, as they see it, is a small circle of small people putting a small ball into a small circle.

But broad trends, underscored by the U.S. Open's arrival at municipally owned and operated Torrey Pines, suggest that the clubby image of golf and the on-the-ground reality of today's American game are miles apart. According to the National Golf Foundation, 99 percent of American golfers play at least some golf on public courses; 77 percent of all rounds played in the United States are played on public courses; and 72 percent of all American golf facilities are public. Furthermore, between 1990 and 2007 when the game saw a net decrease in the number of private clubs, the NGF says the number of public facilities actually rose by 3,519.

This is not in itself shocking. Golf was born as an equal-opportunity activity (The Old Course at St. Andrews is public parkland). What is surprising is the degree to which in recent years public golf has virtually commandeered the sport and the extent to which public courses are now go-to venues for elite championships.

It has been 36 years since the U.S. Open was first played on an arguably "public" golf course (exorbitantly priced Pebble Beach); nine years since the damp-eyed drama of Payne Stewart at the not-inexpensive Pinehurst Resort's No. 2 course; and six years since the elite universe of USGA Championships was completely inverted and the world was let in on a truly public, truly affordable celebration called Bethpage Black on Long Island.

At the time these venues—particularly Bethpage—were announced, it was newsworthy that the USGA, founded in the 19th century for and by private golf clubs, was not only embracing public golf (which it has actually done for some time), but entrusting the nation's golfing crown jewel to the hoi polloi. Now Bethpage looks as if it is the sire to a new tradition: Of the 71 U.S. Opens played prior to the 1972 national championship at Pebble Beach, all were at private clubs. Of the 17 Opens that have been or will be contested between 1999 and 2015, nine will be staged at publicly-accessible venues, and the next three years represent a perfectly public trifecta: next week's Open at Torrey, the 2009 edition at Bethpage and the 2010 staging at Pebble Beach.

And the USGA is not alone. Consider the PGA Tour. Of the 49 events on the PGA Tour's 2008 calendar, 25 will be contested on publicly accessible golf courses (albeit some of those are TPC courses from which the tour derives a healthy income and where the tour avoids costly course-rental fees it has to pay private clubs). Still, contrast that with 28 years ago when only 14 events were staged on public courses.

What's driving these changes? Several disparate but confluent factors, ranging from the 1990 PGA Championship at Shoal Creek to the PGA Tour's PR dust-ups with antitrust regulations and Casey Martin, and, to a lesser extent, Martha Burk's criticism of Augusta National. These chinks in the game's image spurred grassroots feel-good initiatives such as The First Tee program, the "These Guys Are Good" campaign, and a heightened focus on the tour's charitable donations.

At the same time the American golfer weighed in. Citing cost, lack of time and hectic family schedules, he began eschewing private clubs. The children and grandchildren of older Baby Boomers arrived at adulthood and turned their back on the notion of private-club exclusivity.

The result has been a boon to public golf. Today approximately two-thirds of the USGA's member clubs are public facilities. Same with the USGA Members program: More than 60 percent of those ubiquitous red, white and blue bag tags (signifying USGA contributions) are dangling from bags at public courses.

The USGA and the PGA Tour deserve credit for embracing public golf. But in reality, they are simply following the migration. Willie Sutton robbed banks because that's where the money was. Championships are increasingly headed to public courses because that's where the sport is.

"Since I joined the USGA in 1978, we've witnessed a fundamental change in the profile of American golfers," says USGA executive director David Fay. "A majority of American golfers play most of their golf on daily-fee courses, as opposed to private courses. The idea of periodically playing the Open at a public-access course had and has great appeal. For folks to plop down a fee and play the U.S. Open course is—for me at least—pretty cool."

Mike Hughes, CEO of the National Golf Course Owners Association, says selecting public courses for the U.S. Open reconciles the USGA with the marketplace. "The USGA is validating public golf. They're saying something. They're saying that they recognize that public golf is the predominant form of golf in the U.S."

For all its seeming club-centricity and WASPy pedigree, the USGA has long been public golf's best friend. In 1922, after a post-World War I surge in public course play, the USGA created the U.S. Amateur Public Links Championship, a national championship for public course players (ironically, the Publinx has come under criticism in recent years for attracting elite players whose ties to public golf are questionable). Today the USGA donates millions of dollars to facilities and programs that promote public-access golf. All of which raises the obvious question: Given the popularity of public-access golf and the USGA's longstanding recognition of public-course play, why did it take the better part of a century to bring the national championship to a public course?

"My guess," says Fay, the driving force behind the USGA's shift to truly public venues and the person most responsible for bringing the 2002 Open to Bethpage, "is that the private-club influence was so solidly ingrained within the USGA's DNA at that time that the idea of taking the Open to anything but a private club may never have been seriously considered."

Another factor that is no doubt influencing the USGA's awarding of its championships is private-club reflux. In recent years the USGA has experienced resistance from private clubs that had once proven eager to host the Open. In December 2007, only a year and a half after hosting the 2006 Open, Winged Foot famously walked away from a potential return date in 2015. A golfdigest.com article blamed the club's reluctance on "member fatigue."

The fact is an established iconic venue such as Winged Foot has little to gain from hosting an Open. Aside from a little ego massage, the only impact an Open can have on a prestigious club is a headache: Your course gets shut down, and if you're Winged Foot, your second course (the East) is closed for eight months because the Third Army is using it as a staging area.

Conversely the upside for public facilities is obvious: cachet and cash. "For any public golf course that is able to get the U.S. Open, it's sort of like being named the president of the United States: From that point on you will always be known and respected as the site of a U.S. Open," says Hughes. "That's a designation that's unique in the world of golf. There's nothing in our country that's a parallel mark of distinction."

Now comes the cash. Public courses' heavy usage and light municipal funding mean that they are far more likely to be interested in the U.S. Open windfall. In the mid-1990s Bethpage, which hadn't held a USGA championship since the 1936 Amateur Public Links, needed a lot of work and was therefore the beneficiary of lots of U.S. Open dollars. The facility got a $2.5 million course renovation, including a facelift from the "Open Doctor," Rees Jones, all paid for by the USGA.

Upon granting the 2008 Open to Torrey Pines, the USGA opened the spigot—sort of. Local donors already had paid for a multi-million dollar renovation by Jones. According to Mark Woodward, golf operations manager for the city of San Diego, the USGA covered projects such as leveling the landing area on the 18th hole, but not the new tee-to-green cart paths needed to enable effective movement of men and machines (such work was considered deferred maintenance and was therefore the responsibility of the city).

By and large, however, the benefits to a public course of hosting a U.S. Open are limitless. "It's incalculable as far as I can see," says David Catalano, director of Bethpage State Park. "For us to try to quantify the improvements that have occurred, it's not really measurable. The benefits to the public in terms of the conditioning and beauty of the golf course have been monstrous."

But as with increasingly weary private clubs, hosting an Open at a public course is not without its frustrations. In the run-up to this year's Open, Torrey Pines regulars have seen serious cutbacks in their access to the facility. Says a sympathetic Woodward, "The demand is high, but the supply is not what it needs to be."

For all the attention that will be showered on Torrey Pines next week, the greatest benefit (or frustration depending on what side of the cash register you stand on) will accrue well after the Open. At Bethpage, an Open-induced bump in rounds was a physical impossibility (the facility is historically maxed out on tee times), but that hasn't stopped the state of New York from charging a little more. As a result, green fees on the Black Course have risen from a pre-U.S. Open rate of about $25 (for New York residents) to a post-Open cost of about $50 ($60 on weekends; non-residents pay $100, and $120 on weekends). Still a very good deal. As Catalano points out, the late Robert Moses, the incomparable New York power pol who in the 1930s envisioned Bethpage, always referred to the park as the people's country club, but says Catalano proudly, "I'm not sure they had country club conditions back then. They sure do now."

Torrey Pines will hit the post-Open jackpot: higher name recognition, better golf course, more rounds and higher green fees. It can't cash in just yet, however. The facility's contract with the USGA forbids a rise in residents' green fees until 2009. The plan calls for residents' fees to go from about $44 now to about $58 next year. Non-residents, however, will feel the impact of the Open a little sooner. Starting July 1 their rate bumps from $145 to $181.

It took the USGA 107 years to find a truly public golf course for the Open. And from the viewpoint of facilities, players, the USGA or even recalcitrant private clubs, the experiment is working. So, where does the Open go next? A daily fee, stand-alone facility?

Says Fay, "Don't bet against it."