Sign up for the Swampscott Reporter’s newsletter.
The leaky roof of Swampscott Middle School requires costly repairs costing hundreds of thousands of dollars. A vote on a new elementary school, which could cost over $ 100 million, is around the corner. The arrival of a future silver tsunami will require more services for seniors. There are dozens of costly infrastructure and capital projects ranging from replacing archaic city pipes to repairing the Swampscott Fish House.
The city’s largest landowner, Tedesco Country Club, 154 Tedesco St., paid $ 63,085 in Swampscott property taxes in 2020. Between 2015 and 2020, the Swampscott private club’s annual tax bill averaged $ 70,509.
To put this into context, the country club, which was organized in 1900 and founded in 1903, is located on approximately eight lots with a total area of around 175 acres – with 32 acres in Marblehead and 143 acres in Swampscott. The 18-hole golf course with additional practice areas extends over 152 hectares and extends over the neighboring cities.
The private club’s annual Marblehead tax charge, which is 32 acres and a clubhouse of $ 7.2 million, averaged $ 109,445 between 2015 and 2020, the latter community has approximately 112 more acres in golf course land.
According to a 42-year-old state law, the private club receives a 75% reduction in property taxes on its golf course year after year. It submits an official tax break application to the Swampscott Board of Assessors annually, but state law essentially ties the hands of the three-person body to exercise any discretion.
The breakdown
Contrast the Tedesco Country Club’s average tax loads over the past five years next to the numbers behind the organization. This is evident from documents received by the Swampscott Reporter:
- Approximately 700 members in all categories
- $ 40,000 entry fee for full golf members
- $ 7,857 annual membership fee for full golf members
- Approximate gross receipts of $ 5.5 million
- $ 1.5 million, approximate food and beverage income
- Approximately 55 full-time employees and 47 additional seasonal employees
- 60 years, the average age of the members
- $ 34.8 million, net assets and fund balance
Why would Swampscott taxpayers subsidize the resort land of a wealthy private club with an invite-only policy? Herbert Belkin, who lives in Swampscott, has raised this very issue over the years.
“Less than one percent of Massachusetts residents belong to a private country club like Tedesco, which is restricted to membership only to those invited by existing members,” Belkin said. “Such massive tax damage to a handful of wealthy golfers seems ill advised for any community, especially a community like Swampscott, which could benefit in many ways from a fair property tax apportionment.”
He added, “It is time for Tedesco Country Club to pay their fair share like everyone else.”
Tedesco Country Club has not returned the reporter’s request for inclusion in this article.
Suitable for Ch. 61B b
Preferential treatment for private country clubs – which are more than just unregistered not-for-profits – can be traced back to November 7, 1978, the day Bay State voters passed a referendum to amend the constitution.
The passage with 70% of the statewide vote came at a time when Massachusetts residents were revolting against high property taxes in the 1970s. In some cases, high taxes forced large open spaces and recreational areas to develop, as their owners could no longer afford the inflation of property taxes.
The passage of the 1978 referendum resulted in the state legislature and the 1979 governor passing Chapter 61B – “Classification and Taxation of Recreational Areas”. State law provides economic incentives for property owners to keep their land available for certain recreational purposes.
Under chap. 61B, any not-for-profit company can receive a 75% discount on their land that is five acres or more and is used for certain recreational purposes. In addition, the land must be accessible to either the public or members of the non-profit organization.
The Tedesco Country Club, a not-for-profit “social club” with contributing members, is just right for you.
Prior to 1978, since Massachusetts did not yet use tax classifications, taxpayers paid the same tax rate. CH. 61B has worked out a tax classification to reduce the estimated value of land based on its use for open space or recreation rather than its “highest and best use”.
Jane Malme of the Lincoln Institute of Land Policy wrote that the Massachusetts Golf Association and wildlife conservation advocates are “the driving forces behind the expansion of preferential taxation to include recreational uses”, including golf courses. They put their considerable influence and membership into drafting, lobbying and campaigning for the 1978 constitutional amendment and subsequent 1979 laws.
“[Conservation-land advocates’] Assistance was needed to achieve its passage, ”wrote Malme.
Weighing the pros and cons
Use of chap. 61B, in order to give private country club tax breaks, adversaries wrongly shift the tax burden to residential taxpayers and take away much-needed revenue for government services.
Proponents of counter golf courses do not use urban services as much as dense, developed neighborhoods do. Others believe that preserving and protecting recreational and open spaces as suburban communities evolve is a good reason to soak up the tax burden.
Receiving the tax break also comes with obligations, said Swampscott’s Deputy City Administrator for Administration and Finance Ron Mendes during the tax classification hearing that Swampscott selects and appraisers convened in early December.
“They must wait [the land] as a recreational land, ”he said during the tax classification hearing convened by Swampscott select and appraisers in early December. “If they ever wanted to move out of the resort, they’d have to pay a rollback tax that goes back five years.”
Mendes also noted that the city’s special tax status grants a 120-day right of first refusal if Tedesco decides to sell his land under chap. 61B. It’s an opportunity that the city’s open space and recreation plan provides. “Given the recent spending on the new clubhouse, this is unlikely,” the plan said, “but the potential for active and passive recreation would be great if the property were ever available to the city.”
“Grossly unfair, grossly inappropriate”
Some put the tax situation aside for a second, realizing that Tedesco was a good neighbor – from allowing tee time for school golf clubs to hosting golf tournaments that benefit the city’s July 4th fireworks.
Swampscott’s open space and recreation plan also states, “Three new Little League fields have been built on Tedesco Country Club land to replace the one in Jackson Park.”
However, some wonder if these gestures of goodwill correspond to tax losses.
Tedesco’s tax break was a point of brief discussion between city officials, chosen ones and appraisers during the tax classification hearing in early December.
City Administrator Sean Fitzgerald uttered no words when discussing the financial impact of the 150-acre golf course on Swampscott, a three-square-mile, densely populated community with little commercial value.
“A community like Swampscott is losing its foundation for your taxation, and that is a real burden on homeowners,” he said. “It’s important that everyone understand how expensive this is for Swampscott.”
Swampscott 2025: The master plan states: “After residential use, the second largest use of urban land is open space. Almost half of this open space (143 acres) is in the private Tedesco Country Club. ”
Fitzgerald said he wasn’t against having any type of tax metric, but Swampscott’s status quo was “grossly unfair, grossly inappropriate”.
“I think this should be a legislative priority because we are unique,” he said. “We should push a legislative initiative to find a better fit for this unique city.”
Selectman Polly Titcomb spoke of the tax situation as “incredibly unfortunate” during the public hearing in December.
“We have short resources for funding and running our schools and high taxes for residents,” she said. “And then there is this unbelievable space that is not accessible to anyone in the city – and which is of enormous benefit.”
She added, “It just seems so wrong to me.”
