OUT WEST OF CALCUTTA

Beset by rising costs, many clubs are in trouble. Herewith a survey of expenses and ways to meet them—including gambling
January 07, 1957

What was either the worst or the best thing that has recently happened to American golf—it all depends on how you look at it—occurred in September 1955. It was discovered that the two golfers who won the invitation four-ball tournament held by a prominent Long Island club (and with it the lion's share of the $45,000 Calcutta pool) were not only playing with grossly fictitious handicaps but that one of them was playing under the name of another golfer who had been invited to compete in the event.

One of the repercussions of this revelation that "hustling" had reached E. Phillips Oppenheim proportions was a memorandum issued in March 1956 by the United States Golf Association, the official governing body and watchdog of American golf. That memorandum, in short, stated that the USGA "disapproves of gambling in connection with golf tournaments because of the harm it can do to the best interests of the game." "Too frequently," the memorandum went on to explain, "gambling tournaments coming to the USGA Executive Committee's attention have spawned some unpleasantness if not dishonesty—such things as falsification of handicaps and scores, evasion of Rules of Golf, payoffs to players (so-called amateurs), attraction of persons of questionable motives, chicanery in various forms. These things seem almost inevitable where the object is not golf but money. Even in the small, seemingly well-controlled Calcutta, the prospect of financial return has undoubtedly influenced some competitor to 'negotiate' for a higher handicap. Golf should be played for its own sake and not for profit...." Accordingly, the USGA urged its 2,000 member clubs, all golf associations and all sponsors of golf competitions to enact clear and positive resolutions prohibiting Calcutta auction pools, pari-mutuel betting, lotteries and other forms of gambling on tournaments. (As a corollary to this general line of action, the USGA informed amateur golfers that gambling was considered conduct detrimental to the best interests of the game and, as such, a violation of the rules of amateur status. This put some teeth into the wordage, for many fine amateurs, who had been the belles of the ball at the weekend Calcuttas, did not want to lose their amateur status or prejudice their chances for selection to the Walker Cup team.

In this memorandum the USGA announced that it was "reluctant to intrude in the affairs of a club, which theoretically is an extension of the homes of its members," and so limited its action to urging its member clubs to undertake the suggested moves.

The reactions of the member clubs (and also of clubs not directly affiliated with the USGA) were, to say the least, various. Many immediately moved to abolish their Calcuttas and—if they had previously permitted them—other sanctioned forms of gambling on tournaments. Furthermore, they let it be known how genuinely they appreciated the USGA's firm leadership in helping them to rid themselves of the local presence of what they had come to view as golf's special Frankenstein monster. Many other clubs, however, did consider the USGA's request an intrusion of their privacy and, in some cases, an overly paternal affront to their competence: they were fully aware, they declared in effect, that a mismanaged Calcutta could cause all sorts of havoc but their club was able to handle its own affairs; if their members wished to continue to hold a Calcutta, they jolly well would—in fact, they were definitely going to continue to do so.

A large number of clubs ended up on the fence, balanced halfway between these two opposing points of view. The USGA, they felt, might have been somewhat arbitrary in issuing so definite a memorandum unless that organization was prepared to continue to consult with clubs on this thorny joint problem and then to modify or strengthen their official stand in the light of subsequent knowledge. They agreed, nevertheless, to abide by the USGA's request for a period of time and see what they would see. Some of these on-the-fence clubs are still perched there. Others sat there a relatively short time before substituting (or making plans to substitute in 1957) pari-mutuel betting on their tournaments, recognizing that there were indeed marshy regions in the Calcutta setup, but also that the demands of their members for some local autonomy had to be faced up to.

As the 1956 season progressed, a somewhat minor tangent of the controversy was given more and more promise ice in the arguments of the clubs favoring Calcuttas (and/or pari-mutuel betting). Closing down these affairs, they brought out, had seriously staggered their club's financial equilibrium, it having been the using practice for most clubs to receive 10% to 20% of the total pool.

As is beautifully clear to any golfer who has ever paid his annual dues or climbed intrepidly to the top of the delinquent list, postwar golf is a very expensive proposition for the members of private clubs and for the clubs they support collectively. The tax rates on the club's property, the wages for clubhouse staffs (some of which are now unionized), the cost of repairing or improving or expanding the club's physical plant, the prices of equipment, fertilizers, etc., for maintaining the course, the wages of the greenkeeping crew—all of these have risen sharply. To find out just what part a club's share of a Calcutta played in raising increased revenue to meet increased expenses, SPORTS ILLUSTRATED recently undertook an informal survey of the over-all financial operation of representative golf clubs and country clubs located throughout the country. Some of the questions asked were these:

•Did (or does) your club rely to any degree on its share of Calcutta pools as a source of income?

•If so, and if the Calcutta has been abandoned, what steps have been taken to replace this source of income?

•Aside from dues, what methods have been used throughout the years and recently to guarantee a continuing source of income?

•Just how important does the club consider annual dues and initiation fees to be in the financial picture?

•What are your club's financial problems nowadays?

Judging from the answers received to these questions, it would appear that the only clubs which currently do not find the financial going fairly hard are those relatively few clubs fortunate enough to own land adjoining their course which can be sold off for housing lots whenever the treasury is low. There is also a small handful of clubs which can, as a last resort, refer their deficit to a charming, solvent angel (like the celebrated Albert Magill at Mr. Marquand's Happy Knoll) or to said angel's estate. While individual clubs with slightly individual problems have adopted slightly individual methods for raising more money, the results of the survey demonstrate a surprisingly uniform pattern of thinking on financial matters and subsequent action. Because of its "big picture" importance, the over-all aspect of club finances will be dealt with in this report before taking up the Calcutta and other subsidiary measures for producing revenue.

To begin with, the most unpopular way for a club to raise money, the survey indicates, is to divide its annual deficit by its total number of members and assess each member his just portion of this deficit. An assessment seems to leave most members with a very bad taste in their mouths: they invariably feel it would not have been necessary if the club's affairs were properly managed. The only time an assessment is accepted with comparative equanimity comes when a club is engaged upon some large-scale expansion of its plant, such as a new swimming pool or a curling rink—though, of course, it must be expected that members who are bitterly opposed to swimming and curling will not be likely, upon receipt of their bill, to burst out in a volley of huzzahs.

Because of this general aversion of members to being slugged with an assessment, the majority of clubs nowadays turn first toward increasing annual dues (and initiation fees) as their fundamental means of staying healthy. An example in point is an old and solid club in the Chicago area which in 1955 charged its members dues of $225, then found that an additional assessment of $200 was necessary and, with expenses still exceeding income by a few thousand dollars, decided to raise the dues for 1956 to something over $500.

In this particular case this head-on solution has worked out, but more often such directness of attack is impossible. There are many clubs—a veteran club in the Atlanta area is such a one—where dues have been progressively raised and the members now assert truculently that they will not stand for any attempts to raise them one cent higher. One solution to this quandary is for a club to take in a number of new members, but here a very difficult problem frequently besets them: since most clubs already have a full golf-playing membership, the presence of more golf-playing members would make it almost impossible for everyone who wanted to play on the weekends to get onto the course, traffic on the layout being overcrowded to begin with.

One way out of this jam practiced by many clubs is to offer "social memberships" which give new members no golf privileges but open to them all the other facilities. Another way out is to go whole hog, as it were, and to realize that the day of the golf club primarily for men is apparently over unless the membership can afford luxury rates. The result is a change in the basic flavor and makeup of the club so that it becomes a family country club offering people of all ages a full range of facilities for relaxation, above all a swimming pool. Not only does conversion to a family-type setup pay off in the direct terms of stout dues but considerable revenue keeps flowing in from the charges for use of the pool, and the dining room gets far more play when youngsters and parents use the club as a gathering place. Sometimes the bar does, too.

The inner man

In any event, for a club that has upped its dues and still needs a little bolstering, the customary next step, our survey indicates, is to turn to the operation of the dining room and the bar and to see what can be done to make them help out a bit. Usually they do not, and most clubs are willing to settle for breaking even on them, the profits from the bar generally compensating for the loss incurred by the dining room. However, the eternal search for more revenue leads clubs to constantly restudy their food and drink situation with the hope of arriving at some formula that will stimulate a greater income. One Midwest club, after performing just such a study, came up with these provocative if somewhat academic statistics:

Breakdown of Restaurant Accounts for July (the club's peak month):

Average spent by upper third of membership...$93.24 per member
Average spent by middle third of membership...$32.75 per member
Average spent by lower third of membership...$4.99 per member
Average spent per member...$43.66

Breakdown of Bar Accounts for July:

Average spent by upper third of membership...$62.03 per member
Average spent by middle third of membership...$19.08 per member
Average spent by lower third of membership...$2.62 per member
Average spent per member...$27.91

A not uncommon procedure nowadays, if the membership is not drinking and eating enough for the club to make a profit, is to introduce a minimum house-account charge to be levied on each member—say $10 per month. The obvious fly in this Martini is the inevitable unpopularity such a system has with members who do not use the club often enough to consume their minimum. (It might not be amiss to remark at this point that a spokesman for a Connecticut club, in replying to the survey questions, stated that his club believes it is protecting its members when it raises restaurant prices instead of dues, since dues are subject to a 20% federal tax.)

Well, then, let us say that a club has increased its dues, taken in as many new members as it can accommodate, reviewed its bar-restaurant operation, installed a new finance committee—and still finds it must turn up more revenue in order to meet expenses. What supplementary measures can it resort to? Here are a few, some of them absolutely standard and some less so, which have been found helpful:

1. Green fees for guests. (Few clubs commented on this reliable old horse which has been doing its quiet share since the days of the gutta percha.)

2. Locker rental fees. (Comment from most clubs: it justifies itself as well as most charges do.)

3. Rental of the club for weddings, charity dances and the like. (Comment from an Ohio club: "A great majority do not like it, but I guess the majority favor this method over raising the dues.")

4. The "voluntary monthly contribution." (Comment from a large Westchester club: "We put it into effect a few years ago—$5 per member. Less than 2% failed to contribute. It then became $5 for junior members and $10 for senior members. Until last spring these voluntary contributions were nontaxable, but in May 1956 the government decided to tax them. This contribution method has worked well. Our club receives an additional $50,000 annually from it.")

5. The "tournament fund." This is a modest cousin of the "voluntary contribution" but is usually conducted on a more voluntary basis. Interested members donate a small amount, say $10, to create a fund used by the tournament committee to purchase prizes for the club's competitions.

6. Placing a new manager in charge of the club. (Comment from a Pacific Coast club: "It is hard to find the right man. Over the last five years we have had three or four in rapid succession. Although they are well versed in restaurant management, hotel management and even city club management, they do not seem to understand the problems peculiar to our club and, I suppose, peculiar to any country club.")

7. Encouraging the members to remember the club in their wills.

8. Raffles. (Comment: the raffle has come back in recent years, not that anyone likes it or the prizes but because of the expulsion of other forms of gambling more pleasurable for the participant and more lucrative for the club—the slot machine especially. From a Southern club: "These mechanical swindling machines were invariably placed within a long arm's reach of the swigging counter, where each encouraged the other. Thus clubs collected two ways simultaneously. It was something again when these mother lodes were permanently banished by envious city, country, state and national tax authorities. The effect on clubs was like the Klondike drying up in a single day.") (Added comment on the raffle: at one well-heeled Massachusetts club, in order to avoid a situation in which the winner of the auto being raffled off would also fall heir to a whopping tax, the members printed no circulars, no tickets, no anything that would inform the "outside world" what was taking place. The members quickly penciled the numbers of their tickets on the sleeves of old sport shirts and proceeded with muffled oar.)

9. The Calcutta and its variations.

Judging from the survey, a significant fact about the Calcutta, viewed as a source of club income, is that 90% of the clubs interviewed stated that giving up their Calcuttas affected their financial position hardly or not at all. Quite a number of these clubs were speaking after several years of experience, having suspended their Calcuttas well before the USGA's memorandum for a variety of local reasons ranging from a fear of encouraging gambling for high stakes to a lofty reward for the club's liquor license, it being, in this latter contingency, a law in some states that gambling cannot be conducted on the same premises where alcoholic beverages are dispensed. Some clubs reported that they had never held Calcuttas; others, that they formerly had but that the club had never taken a cut from the pool. The reason for this stand in most cases was less moral than pecuniary: the clubs did not believe that leaning on Calcutta cuts added up to a sound method of finance.

Calcuttas mean interest

It might be interpolated at this juncture that, whether a club wanted the Calcutta back or was glad it was gone, nearly all clubs reported that conducting Calcutta tournaments had certainly aroused club interest, that members turned out as at no other time during the season, and that both the restaurant and the bar received a terrific play. Without the Calcutta, the loss of these revenues was quite substantial. It might also be interpolated here that quite a few clubs, having looked into the Calcutta situation for themselves, are firmly convinced that a club's share of a "limited Calcutta" amounts to such a small sum that the clubs pleading the "economic necessity" angle are inventing a good reason to obscure the real reason—in short, creating a smoke screen.

Perhaps this takes us close to the heart of the matter. Gambling at golf—is it a spice, a spark, a splendid spur at the spa or is it an onus and an open-sesame to opprobrium? As Sir Roger de Coverley, that seasoned clubman, put it, there is much to be said on both sides, indeed, and it would seem the fitting thing at this point to present a synthesis of the arguments of the opposing camps.

The men in favor of gambling put their case something like this: "All of us are agreed that it is human to gamble, and just as men were bound to continue to drink after the Volstead Act was passed, they will gamble after a ban is imposed. The Nassau (or hole-by-hole bet) gives golfers who are not good enough to play in championship or near-championship tourneys a chance to test themselves under pressure and to derive the same satisfaction a low-handicap performer finds in competition. And the good players enjoy it too. It is all very simple. A bet, as any honest golfer will admit, adds a kick to the game, generally increases the fun, the conversation, the interest, the release. That's why most people choose to play for something, be it at bridge or backgammon or bowling, and there's really no reason why a man who wants to bet should be embarrassed by his attitude.

"As for the Calcutta, its particular machinery—let's face it—has tremendous appeal, the greatest appeal of all forms of betting on golf. That's why it has attained its popularity. Granting that some inadequately supervised Calcuttas have permitted the 'wrong element' to seep into golf, it is quite unjust to penalize all clubs for the lapses of one or two clubs. In the final analysis, after an individual is 21, it is up to him whether he gambles or not, drinks or not, takes lessons from the pro or not, or orders his steak with or without Worcestershire sauce."

Those against

The men who are against gambling in golf put their case something like this: "Conceding that it is human nature to gamble, experience has demonstrated that it is also pretty human for many people to forget about principle when stakes get high. Whether or not a person chooses to play for high stakes is up to the individual. There is nothing wrong with this as long as these are matches between individuals or teams in a foursome, particularly when they can afford to play for high stakes. However, when gambling becomes a club proposition and moves out of the 'private match' sphere, it becomes a horse of a decidedly different color. For one thing, it is injurious to the atmosphere of a club when golf is no longer deemed sufficient sport in itself or sufficient challenge in itself—when people play primarily to win money and not to win golf matches. Everything spirals: 'protective' handicaps, amounts wagered, hard feelings. In this day and age the competitive instinct has become, surely if understandably, exaggerated in certain men, but instead of sport being one area where they can return to finer values, it has become merely another theater for besting your rival, not by skill of play but by skill of wager (or, sometimes, amount of wager). There are certain things to be said for a 'limited Calcutta' for club members only, but under the demand for stronger wine and madder music (not to mention the influence of the tax laws), these events almost inevitably expand into member-guest tourneys, the money involved mounts geometrically, the whole affair undergoes a basic change of complexion and spirit and, before you know it, you're in trouble again."

These two antithetical views on the place of gambling in golf did not evolve overnight, any more than did the problems of club finance with which, in some ways but indeed not in all ways, they have become intertwined. While the purpose of this article is to inform and not to conclude—solutions cannot be arrived at overnight either—the survey and the other data at hand suggest certain lines of solution which might be noted:

1. In concert with all types of member clubs, the USGA should continue to study all aspects of gambling in golf, with the aim, of course, of arriving at formal or informal legislation that honestly and sensibly reflects reality and so serves the best interests of the game.

2. Clubs should not try only the old revenue wheezes but should think about new, equitable and even agreeable means of raising subsidiary income. Here, just as examples, are a few illustrations that have come to our attention.

a. Charging a player an extra 50¢ whenever he takes a caddy, with the extra 50¢ going to the club. Most clubs average somewhere between 15,000 and 18,000 rounds a year, and through this unpunishing impost a club would collect between $7,500 and $9,000 annually.

b. If raffles are used, clubs should put up prizes that carry the definite spirit of golf and are truly desired. For example, if a name tournament pro were invited to a club for a day or a weekend and the three spots in his foursome were raffled off, there are few members who wouldn't be genuinely interested in trying to win one of those places.

c. Another generally dependable method of raising revenue that has been largely ignored of late is booking well-known pros for exhibition matches. If, let us say, the pro's fee is $600 and the club sells 1,500 tickets at $2 a head, the club stands to make $2,400 minus taxes, on a pleasurable event.

3. It would appear that the road to stability for most clubs today is to go with the times and become full-fledged country clubs serving all the members of a family—the year round if possible. As for members of clubs which prefer to remain men's golf clubs and the members of "resort colony" clubs with a limited season and membership, well, they simply must expect to pay rather handsomely for their golf. There are no two ways about it.

Oh, yes, there is one other solution which a plush Los Angeles club has tested successfully and which may easily be the most brilliant solution of all: strike oil on your property.

ILLUSTRATIONTHE COOL, untroubled facade (left) of the Happy Knolls of America conceals these days an invariable plexus of financial problems facing many of them. Several of the chief factors which have led to this state of strain are revealed in the cutaway sketch above. They include: 1) increased taxes on club property; 2) higher wages for clubhouse staff; 3) higher costs of maintaining golf course; 4) rising wages for greenkeeping staff; 5) rising repair costs; 6) lofty expense of adding new facilities. ILLUSTRATION[See caption above.]
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ILLUSTRATIONNOLEN & SWINBURNE, ARCHITECTSINDEX OF THE ATTENTION NOW GIVEN THE TEEN-AGE SET IN THE FAMILY-STYLE COUNTRY CLUB IS THIS ARCHITECTS' RENDERING OF THE PROPOSED JUNIORS' RUMPUS ROOM (COMPLETE WITH A SNACK BAR AND JUKEBOX) FOR THE PHILADELPHIA C.C.'S NEW CLUBHOUSE

CHUTNEY AND CHIPS

The exact origin of the Calcutta is not known, but it probably derives from a wagering system devised by British army officers in India to add a little spice to local sports events. As far as American golf goes, a Calcutta pool was first conducted along the eastern seaboard in 1914. Briefly, in a Calcutta the competing players—or in a four-ball event, the competing teams—are auctioned off to the highest bidders. The players with the best chance of winning naturally go for the highest prices. In order to auction off all the competitors, those who are least likely to succeed are often lumped together in a field; if any one of them wins, the holder of the ticket on the field wins the Calcutta. In a $100,000 Calcutta, this might amount to $40,000 since the winner usually receives about 40% of the total pool—the sum of the various amounts paid for the various players. Second place might pay 20%, third and fourth places 10%, with the remaining 20% going in various slices to the club, a charity sometimes and to cover the cost of operating the Calcutta.

HOLE YARDS PAR R1 R2 R3 R4
OUT
HOLE YARDS PAR R1 R2 R3 R4
IN
Eagle (-2)
Birdie (-1)
Bogey (+1)
Double Bogey (+2)