Jeff Cohen रीट्वीट किया
Los Angeles Country Club is one of the world's most exclusive golf clubs.
• $250,000 initiation fees
• No celebrities or social media posts
And they use a 45-year-old tax loophole to save $80 million annually.
Here's how it works:
LACC sits on 320 acres in the heart of LA.
It's one of the country's nicest (and strictest) country clubs.
They don't allow celebrities to join, and every new member is handed a 1,000+ page rulebook.
LACC Rules
• No shorts (tailored pants only)
• Sport coats in the clubhouse after 6 pm
• No changing shoes in the parking lot
• No headphones, earbuds, or athletic clothes
• No photos or videos of the club on social media
Members can also only make phone calls from their parked car or a phone booth in the locker room.
And the club is so exclusive that many of the world's best players are seeing it for the first time this week.
Rory McIlroy, for instance, hasn't paid for a round of golf in 20 years. But he had never played LACC before this week's US Open, so he says he prepared by watching videos of the course on YouTube.
Still, the craziest part about LACC isn't its $250,000 initiation fee or its 1,000+ page rulebook.
The craziest part about LACC is its real estate.
The 320-acre piece of land sits smack dab in the middle of Beverly Hills — between the famous roads of Sunset Blvd, Wilshire Blvd, and Santa Monica Blvd.
The land alone is reportedly worth $8 billion, making it the second most valuable piece of real estate (not developed for housing) behind Central Park in NYC.
But here's the craziest part...
An $8 billion assessed land value would typically mean hundreds of millions in property taxes alone.
But LACC only pays $220,000 in annual taxes.
This is because of two rules:
1. LACC is owned by its members and registered as a non-profit. So they benefited when California voters passed a ballot in 1960 that lowered the value at which officials were allowed to assess non-profit golf courses.
This non-profit rule also applies to other LA-based golf clubs, like Bel Air Country Club, Brentwood Country Club, and Wilshire Country Club.
2. Then, in 1978, voters passed Proposition 13. This new law rolled back the assessed land value to its 1975 level and more or less froze that value in time.
So even if the market value of the land tripled in value, the property's assessed value can only grow by 2% a year or the rate of inflation, whichever is lower.
And Proposition 13 also capped property taxes at 1% of assessed value (vs. the previous average of 2.67%).
So, in simple terms, Los Angeles Country Club would be paying about $80 million (1%) in annual property taxes because its land is worth $8 billion-plus.
But because of these two laws enacted more than 45 years ago, LACC’s land is currently assessed at just $22 million, and they only pay $220,000 in property taxes.
LACC Tax Breakdown (estimates)
• True value of the land: $8 billion
• Assessed value of the land: $22 million
• Annual property tax savings: $80 million
Now, Proposition 13 wasn’t put in place specifically for golf courses — its true purpose was to protect homeowners who are older, retired, and living on fixed income from payment shock when their property values dramatically increase over a short period of time.
But given the financial savings it has provided exclusive golf clubs over the years, it’s no wonder why Los Angeles Country Club wants to keep things exactly as they are.
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