It’s a $37 million dispute that every year costs taxpayers millions more, but the standoff between city hall and nine subsidized private golf clubs has barely moved since council ordered action a year and a half ago.

Thanks to a decades-old agreement intended to preserve urban green space, a handful of exclusive country clubs — whose members have paid as much as six figures to enroll — are permitted to defer annual property tax payments.

As of this year, it’s cost the city more than $37 million in potential tax revenue.

Former councillor Adrian Heaps was the most recent city politician to bring the item to council. In August 2010, council voted 19-11 to negotiate a new arrangement with the club owners, which would either see the deal scrapped or at least provide more public access.

“I haven’t heard anything from the city in more than a year,” said Herb Pirk, general manager of Oakdale Golf and Country Club. Oakdale is one of the few clubs that has partially opened its doors to the community.

Pirk, like others, is eager to move forward.

The situation is an optics nightmare for the posh clubs, but owners say they are handcuffed under the current terms.

The deals were designed in the 1950s and 1960s during an unprecedented development boom in the province. Developers were buying up green space at an alarming rate, so the municipalities of Etobicoke, North York, Scarborough, Toronto and York signed agreements with local courses to prevent clubs from selling. In exchange for promising to stay a golf course, clubs could defer between 10 and 30 per cent of their property tax payment. If they ever chose to sell, it would need to be repaid with interest.

Those contracts were made in perpetuity and in order to revisit the terms, both parties would need to agree. To further complicate the problem, several years ago the Municipal Property Assessment Corp. changed the way it evaluates golf courses, which caused the tax rate to spike.

Golf courses across the province appealed. At the time of the 2010 council decision, owners said they weren’t in a position to discuss new options until the amount of money owed is settled. Club owners say it is significantly lower than $37 million.

This process is finally coming to a close. MPAC has signed deals with about half of the nine clubs in question, and the remaining owners have received the new assessment numbers and are currently reviewing them.

In January, city council approved a handful of the new rates, although the amounts are confidential.

Pirk said Oakdale will definitely sit down with the city once the money is nailed down.

“Each club will have to make its own decision, but Oakdale’s interest has always been to have good relations with the city and we’re prepared to deal with the matter. How that will be structured I wouldn’t want to hazard a guess at this point,” he said.

One option floated in the past is that the courses begin paying off the debt as a loan. And according to Joe Regina, an account manager with MPAC, the amount in question will in fact be lower for most of the owners.

“The reductions in value are the result of changes in the market conditions. In the past decade, the value of golf courses have declined significantly, largely due to increased competition and maintenance costs. Each course was reviewed and valued on their own factual circumstances, and so the resulting reductions varied from 1 per cent to 53 per cent,” he said.

For Deputy Mayor Doug Holyday — who is a member at one of the clubs and declares a conflict whenever the matter goes before council — it’s frustrating that the course owners are demonized in the debate.

“The system was set up by government to try to get golf courses from selling off their properties,” he said. “And when all the information is out, council might see the advantage of keeping those spaces green. It’s been portrayed that it doesn’t look good for the golf course, but it wasn’t the golf courses that did this. It was government.”

Loading... Loading... Loading... Loading... Loading... Loading...

Nine private clubs

During the building boom of the 1950s and 1960s, deals were signed with nine Toronto golf courses in an effort to protect green spaces. The following clubs agreed not to sell their land and were allowed to defer a portion of their property tax:

Rosedale Golf Club

The Toronto Hunt

Islington Golf Club

Scarboro Golf and Country Club

Lambton Golf and Country Club

St. George’s Golf and Country Club

Oakdale Golf and Country Club

Weston Golf and Country Club

Markland Wood Country Club.