By Amy Silverman
By Olivia LaVecchia
By Monica Alonzo and Stephen Lemons
By Chris Parker
By Michael Lacey
By Weston Phippen
In the end, the $4.3 million in land and an estimated $10 million in improvements now have a taxable value of about $1.3 million. At current tax rates, the $13 million value reduction saves Grayhawk's owners nearly $100,000 in county property taxes each year.
These tax breaks apply to all courses, new or old. Even allowing for differences in the level of development and amenities at each course, it is not difficult to see that huge amounts of property value are taken off local tax rolls by the rule. Maricopa County assessor and treasurer records show that the county loses nearly $10 million in revenue per year as a result of the new golf-course valuation law.
County Assessor Pete Corpstein says the golf property-tax giveaway is indicative of legislative efforts to shift tax burdens off developers, utilities and industries and onto the general public.
"With all the [budget] trouble the county has had in the last few years, the Legislature still shrinks the tax base," Corpstein says. "We're talking about a lot of money."
It may be worth remembering that a $238 million subsidy for a baseball stadium caused outrage in the Valley. Because the golf subsidy is less visible, however, there have been few protests against it--even though it will cost taxpayers a lot more than Bank One Ballpark over time.
The Arizona Golf Association lobbied hard for this change in the law, and it's easy to see why.
As more courses were built in Arizona over the past few years, overall attendance numbers have not gone up. New, flashier courses may pull in more tourists during the winter, but the total number of annual rounds played in the state has remained basically flat. With more and more courses vying for the attention of golfers, business at all of them has suffered somewhat. Removing virtually all of their property-tax burden--that is, giving golf courses an indirect but huge public subsidy--is one way to keep profitability high.
Curiously, Arizona is the only state in which golf-course owners enjoy such protection. In the other big golfing states--California, Texas and Florida--no such appraisal law exists. And despite the annual boost the income gives the courses, average year-round greens fees are higher in Arizona than in any other state.
Local preservationists say that Reach 11 is one of the Valley's most significant desert areas not yet overrun by rapacious growth. A "reach" is an area along a canal that is unbroken by roads, bridges or the like. Reach 11 runs on the north side of the Central Arizona Project (CAP) between Cave Creek and Scottsdale roads. The city of Phoenix, with Scottsdale's help, plans to turn much of this rich habitat area into developed land--complete with two golf courses.
Five years ago, there was one fully operational golf course in the area loosely defined as "Carefree-Cave Creek." Now, there are 11. At least ten more, including the two in Reach 11, are on the drawing boards. Besides the increased traffic, noise and pollution that longtime residents bemoan, there is a less obvious but more serious problem: water.
Golf courses in Arizona use at least 1.5 million gallons of water per acre each year. They need much more water, per acre, than do courses almost anywhere else in the world. Course superintendents can truthfully say that golf courses have drastically reduced their water use in the last decade, through the use of special sprinkler heads and closer supervision of their watering regimens. But those claims are little consolation to the planners who must contemplate the unslakable thirsts of desert golf meccas such as Palm Springs, Las Vegas and Phoenix. At the hot, windy Palm Springs Country Club, for example, about 430 million gallons of water--enough to meet the daily needs of almost 11,000 people--are pumped from an aquifer each year to maintain the golf course. So alarmed were town citizens when they realized how much of their water was being used to irrigate the course that they drastically changed the club's water-use rules.
So far, no one has done that in Cave Creek.
Look at a map of the Cave Creek area and you'll see a more-or-less straight line of golf courses and clubs stretching from Tatum Ranch, near the intersection of the Carefree Highway and Tatum Boulevard, to the north and east. Other courses in the chain include the Boulders, at the Carefree Highway and Scottsdale Road; Desert Forest, at Pima Road and Cave Creek Road; and Desert Mountain, near the Carefree Airport. These courses form a part of the hodgepodge of courses which depend, to one extent or another, on groundwater from the Cave Creek Basin. The basin is an underground aquifer about eight miles long and two miles wide. It was formed around 13 million years ago after volcanic rock in the area cooled and cracked, and water began leaking in from surface and underground sources. It is one of the smaller aquifers in the state and has provided well water for residents of Carefree and Cave Creek ever since they began moving there more than 100 years ago.
In the last few years, however, locals have noticed something disturbing. Their water table has fallen at the rate of nearly 20 feet per year in some areas.