Golf News December 2014

If you are interested in golf industry news, take a look at  Robert J. Vasilak’s “World Golf Report”.  Mr. Vasilak seems to be ahead of the curve, when it comes to reporting golf development news.  I’m sure you will also enjoy his sharp wit.

Below, are some excerpts we “borrowed” from his column – which describe some of the issues facing golf courses today:

Golf membership traps property owners at Callawassie, lawsuit says

Hilton Head Island Packet
BYLINE: Dan Burley

On Callawassie Island, you can buy land any time you like.

But you can never leave.

At least that’s what some island property owners claim in a federal lawsuit filed last month.

About 45 owners have sued the island’s private golf club for requiring them to become members and refusing to let them resign their membership. They argue the requirement that every property owner be a member is illegal.

That requirement has caused a ripple effect that has decimated property values to the point that some cannot sell their lots even for $1, according to the lawsuit. Others have filed for bankruptcy because they couldn’t pay the fees, the lawsuit says.

An attorney for the club and the property owners association, which also is being sued, declined to comment Wednesday.

In court filings, the club said the owners signed a contract that laid out the terms they are now protesting. The club also argues that three state judges have ruled in its favor in lawsuits making similar claims.

Owners “now seek relief in a new forum in hopes of turning the tide of (the club’s) success in Circuit Court,” the club’s attorney says in a motion to dismiss the federal case.

Started in the mid 1980s, the Callawassie development was intended to be a lower-cost alternative to the more upscale golf course communities in Beaufort County. Middle managers and military veterans retired to the island, which is between Beaufort and Bluffton. Initially, membership to the country club was optional, says Homer Knearl, a retired patent lawyer who has owned property on Callawassie since 1991.

But as interest in golf has waned and golf-centered communities folded across the U.S., the country club continued to expand and sink into debt, said former lot owner Bill Hobson.

Soon the club needed cash, he said.

In 2001, the club required new property owners to become members and pay dues. It was approved by the owners association, according to the lawsuit.

“That’s when the problems started,” said Knearl. “They transformed membership from voluntary to mandatory, and they wouldn’t let people out.”

Lolita Trifiletti bought Callawassie land in 2005 with hopes of retiring there. At first, the Charlotte resident paid $100 a month, along with a $15,000 initiation fee to the club in case she decided to forgo her membership, she said.

But fees increased when the club paid for a $4 million renovation in 2008. Now she’s paying $640 a month for a golf club she hasn’t visited in seven years, she said.

When she tried to resign, she was told she couldn’t leave until she paid $38,000 in dues and found someone else to take her membership. She and the club are battling in state court over the dues.

“How can you not resign?” she asked. “It’s a club. Think about it — a club.”

Trifiletti is among the owners suing in federal court to cancel memberships. Their lawsuit argues, in part, that since the golf club is a non-profit company, state law allows members to leave at any time and forgo their dues.

But that argument hasn’t worked in state court, according to filings.
In one lawsuit in which the club sought delinquent fees, Beaufort County Circuit Court Judge Carmen Mullen ruled that the owners must pay their dues because state law says that when a member resigns from a non-profit it “does not relieve the member from any obligations.”

“These provisions plainly demonstrate that a member may not void a contractual undertaking simply by leaving a club,” Mullen wrote in her decision.

The owners’ contract also says they must pass on their membership to the next property owner before leaving the club.

That’s been tricky for some.

The membership requirement has scared away potential buyers and killed property values, the owners say.

Trifiletti’s property has been on the market for years. She even tried to give it away, but neither Habitat for Humanity nor Wounded Warriors would take it because of the membership requirement, she said.

The owners’ point is supported by a private memorandum that was circulated among golf-club board members in 2008.

“The most important ‘unanticipated’ reality is that all of the golf memberships will NEVER sell, and BOTH the developer and the golf club have a problem,” according to the memo, which is quoted in the lawsuit.

Hobson, the former Callawassie owner, tracks properties sold in the development. He estimated the average loss this year for the seller is $90,000.

“Nobody wants to buy a membership you can’t get out of,” said Trifiletti. “You’re trapped.”
You say – you would like to live next to a golf course? How about this new development?

Seminole lays down the law: Owners of closed golf courses must clean them up

Orlando Sentinel (Florida)
BYLINE: Martin E. Comas
Seminole County homeowners who have watched in frustration as their neighborhoods’ old golf courses have turned into jungles of overgrown weeds and tall grass received some relief on Tuesday.

County commissioners unanimously approved tighter restrictions on the maintenance of large tracts of land — including old golf courses. Dozens of residents at the meeting supported the new ordinance, saying that unkempt fairways and putting greens near their homes have deteriorated their communities.

“When you have one person in a neighborhood who doesn’t keep up their property, it affects their neighbors next door and maybe the person across the street,” said Kit Bradshaw, a Seminole resident who lives near the recently closed Rolling Hills golf course. But when a large-property owner neglects maintaining their land, “you not only affect the nearby homeowners with an unsightly view … you also create a detriment to the values of hundreds of homes.”

Under the county’s new ordinance, grass and weeds on most privately owned properties cannot be higher than 8 inches, regardless of how far it is from a home or other building.
The county’s old rules prohibited only grass and weeds from growing more than 24 inches high within 75 feet of a home or other structure.

Because the acreage for most golf courses falls outside that 75-foot boundary, anyone buying up the old courses did not have to mow the fairways as they waited to develop homes on the property.

Violators of the new law could face fines of up to $250 a day.

“This is not just a Seminole County issue…. This is going to be a regional problem,” said Commissioner Lee Constantine in pointing out that a growing number of Central Florida golf courses have closed in recent years. . . .

Controversial townhome plan withdrawn
The Daily Commercial (Leesburg, Florida)
BYLINE: Livi Stanford
Groveland Mayor Tim Loucks confirmed Friday morning that the owners of the Palisades Country Club golf course in Clermont have withdrawn their controversial application to annex 226 acres into Groveland and build 118 luxury townhomes.

“For me, I consider it one of the finest moments in cooperation between government and citizens,” Loucks said in a phone interview Friday morning. “It is a win for the people. It is what democracy is all about.”

Nearly 500 homeowners in the community had signed a petition against the annexation. Residents said they moved into the Palisades because it was a single-family housing development, and they don’t want townhomes that they believe will depreciate home values and increase traffic in the area.

While homeowners greeted the news with enthusiasm Friday, there was still concern the golf course owner, Joseph Bonanno, could resubmit the application in the future.
“We have been informed the current owners plan to return and reengage us with efforts to promote construction of their townhomes,” said Fred Costello, a 10-year resident of Palisades. “We need to achieve closure on the annexation issue and assure our homeowners that any similar threats of annexation and/or construction of housing units on Palisades golf course property will be defeated by Groveland staff before they gain any traction.”

In response, Bonanno said in a phone interview: “At this particular time we are not bringing it back.”

“There were too many people that were against it,” he said. “You can’t fight city hall.”
Bonanno previously said the golf course does not sustain itself, and the only way to keep it afloat was to build condos there. As a result, he said, the withdrawal of the application will affect the sustainability of the golf course.

“We are going to try to keep the golf course open if we can,” he said. “We are running it at a loss and will continue to run it at a loss.” . . .

 

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