ON THE RANGE
by Tom Cunneff
Jay Karen is the CEO of the National Golf Course Owners Association, where he leads efforts in advocacy, education, and commerce for golf course operators. Last April, U.S. Senator Ted Cruz invited him to testify at a Senate Commerce, Science, and Transportation Committee hearing about “Locking the Clock” (sticking to either standard or daylight time), causing Jimmy Kimmel to poke fun at the proceedings and mention the NGCOA by name on his late-night show on ABC. Karen also represented the golf industry at a House Subcommittee on Commerce, Manufacturing, and Trade hearing in November, discussing issues related to travel and tourism, such as H-2B visas for non-immigrant foreign workers. Although the NGCOA has 4,000 member facilities, 85% of which are public, it really represents all 15,000 golf course operators in the U.S. with its work, which includes educating operators through conferences, publications, and research.
There are some conspicuous associations in golf, and we’re the least conspicuous of them all. We’re kind of the behind-the-scenes association, advocating for golf course owners and operators, and that is everything from what’s happening in Washington to fighting lawsuits and putting out a ton of information. There are many public policies and laws that impact the golf industry because we’re a multifaceted business. We’re not only in the land business with more than 15,000 golf courses; we’re also in the people business with 2 million jobs in America. The NCCOA represents the golf industry on taxation issues, environmental issues, labor issues, and many others. We even helped fight some errant golf ball lawsuits at the highest courts in New York and Massachusetts that were going to be very detrimental to the golf industry, leaning in with amicus briefs.
That was Cazenovia Golf Club, a nine-hole, private club in upstate New York that’s over 100 years old. They were playing their annual member-member tournament in 2020, and someone riding up the seventh fairway got hit in the eye with an errant golf ball from the third hole. The injured guy sued the golfer, the golfer’s playing partner, and the golf course. And during the court process, the playing partner and the golfer were removed from the suit, and the golf course remained as a defendant, and it made its way all the way to the New York State Court of Appeals. Because it’s a nine-hole course, members play the nine twice to get in 18 holes. On the third hole, they play the tee box that's farther back the second time, just to create a little variety. The club added a new back tee around 2005, and the plaintiff was trying to argue that the situation in question superseded the doctrine of reasonable assumption of risk. When you step on a golf course, you’re kind of assuming the risk that you might get hit by a ball, right? Well, that doctrine applies universally in these cases unless a plaintiff can prove that the golf course did something very negligent that created a dangerous situation that is beyond what’s inherent in the game of golf. He was trying to argue that this tee box was created with no safety standards in mind. But it was just a terrible accident, and the golf course won unanimously. I was at the trial, and it was quite a spectacle to watch these seven justices ask questions of both attorneys about the game of golf, inherent risk, and all of these interesting questions. You could tell immediately who was a golfer and who wasn’t by the questions they were asking.
Congress is deliberating if we should stop changing the clocks twice a year, and if so, land on standard time or daylight saving time. If Congress makes standard time permanent, that would be an enormous economic wound to the golf industry because the extra daylight in the evening is much more conducive to outdoor exercise, including golf, than in the morning. Imagine losing or hampering all the spring, summer and fall evening leagues, junior golf, lessons, etc. Two-thirds of course operators would like to see DST made permanent, while about a quarter of them are fine with the status quo. My job in the testimony was to explain the nuances and implications of all options on the golf industry, and by proxy the outdoor industry.
Economic uncertainty. If you’ve been a golf course owner or operator for more than 20 years, then you’ve seen some ups and downs. How do we remain economically viable in the next generation? It’s the push-pull of, how do I set my tee time rates so that I get what I need to run this business, but I’m not alienating the customers and not making golf too unaffordable, because there’s something in the DNA of golf that we want everybody to play the game. There is also the question of, how am I going to have enough money in my operation for capital improvements? It’s often been described as a land-rich, cash-poor business. Top of mind for owner-operators is cash flow. Can I pay my people, can I pay my vendors? And workforce issues are always a challenge, finding the talent that you need and paying your employees what they need to be paid.
The supply of public golf is likely going to continue to decrease over the long haul. One of the biggest things on my mind is, what is the golf course supply in America going to look like 100 years from now when you’ve got courses closing now because of redevelopment opportunity? As we say in the industry, the dirt is worth more than the turf, so courses are turning into data centers and solar farms and are getting tens of millions of dollars for the land that might be worth a fraction of that price as a golf course. These privately owned daily fee courses are ripe for redevelopment because you’ve got 200 acres of land in the suburbs near population centers. Most of the courses being built now are high-end, private clubs in the middle of nowhere. Building a daily-fee course doesn’t pencil out anymore, so there’s going to be a continuing contraction of supply over the next 100 years. We’ll have to backfill, and perhaps expand, supply with simulator places, short courses, and gamified ranges. All these alternative ways are going to be seen as less alternative. I’m not saying it’s going to go as far as what's happened in South Korea, where there are over 5,000 golf simulator locations and less than 500 golf courses. There are South Koreans who never find their way to play golf on grass. Their entire golfing lives are played in driving ranges and simulators.
Not in a pejorative way. I think it’s an opportunity. The whole conversation about off-course golf started with the Topgolf phenomenon. There was kind of a chip on the shoulder of golf courses when Topgolf came around about 10 years ago, like, “Are you going to take our lunch from us, or are you going to make golfers out of the people coming to your place?” But I said early on, you’re asking the wrong question. You need to be asking, what are they doing at Top Golf that I can emulate at my facility? And fast forward, we’ve got the technology to do that at the driving range. Washington Golf and Country Club in Arlington, Va., has a great, two-tiered driving range system with Toptracer range technology, so you can track your shots. It’s exciting to me that we’ve got this alternative way to experience the game. Any other sport would kill for what golf has in this way. We should be on our knees grateful that we have this available to us as an industry because it will just deepen the relationship with people and the game.