As you know, I’ve talked before about sunsetting tax expenditures. Sens. John Carona and Rodney Ellis have filed a bill to require a periodic review of the many exemptions, exceptions, and other special cases in the tax code, with the aim of requiring legislative approval to renew or extend them. This is a good idea for many reasons, and State Impact Texas highlights one of those reasons.
One break Sen. Ellis says could be targeted right now is one used by country clubs. Ellis will be the first to tell you what a lovely time one can have on the links of the exclusive River Oaks Country Club in Houston.
“I have a lot of good friends who are members there, have had the benefit of being able to play once or twice, would like to get invited again, may not get invited the day you run this story,” Ellis told StateImpact.
Two decades ago as a newly-elected legislator, Ellis saw a news article about how some local country clubs took advantage of a big break and avoided paying millions in property tax. Known as the Greenbelt Act, it gives enormous property tax discounts to owners of tracts of green space that is used only for recreation.
Ellis’s staff found that in the 10 most-populated counties in Texas, a total of 36 clubs took advantage of the break (some counties had no clubs that used it including those in Dallas, Fort Bend, Travis and Bexar counties).
Harris County had by far the most clubs utlilizing the break with 22 of 26 private clubs saving millions in taxes. Ellis’s office found that the River Oaks Country Club had the biggest savings, about $2 million a year from getting its golf course’s market value of about $80 million marked down to only $4.2 million. A call to the club did not result in obtaining a comment.
OK, I’m open to suggestion here. What’s a good public policy rationale for giving this tax break to the River Oaks Country Club? Are we afraid they might lay off a groundskeeper or something if they paid taxes based on the actual appraised value of their property? Make your case in the comments, I’d love to hear it.