The Great Country Club Tax Break

Country clubs all over Maryland benefit from a special property tax break that saves them millions of dollars every year. Here’s how it works.

Decades ago, the General Assembly passed legislation intended to prevent the sale of golf clubs and country clubs for subdivision. In § 8-212 through 8-218 of Maryland’s code, the State Department of Assessments and Taxation (SDAT) is permitted to strike agreements lasting ten years or more with golf courses and some country clubs specifying discount land assessment rates. A country club is eligible for these agreements if it:

(1) has at least 100 members, who pay dues averaging $50 or more annually for each member;

(2) restricts use of its facilities primarily to members, families, and guests; and

(3) is located on at least 50 acres of land, on which is maintained:

(i) a regular or championship golf course of at least 9 holes; and

(ii) a clubhouse.

In practice, SDAT provides a land assessment rate of $1,000 per acre to clubs with agreements. If a club sells its land for subdivision, it must pay back taxes equivalent to what it would have been paying without an agreement. The club can also lose the tax break if it discriminates on race, color, creed, sex or national origin.

Many country clubs take advantage of this tax break. The Bethesda Country Club, for example, has a 142.79-acre property. Its land is assessed at only $142,700. See the notation, “Preferential Land Value Included in Land Value” in its property record below.


Manor Country Club in Rockville is another beneficiary. It has a 176.96-acre property with a land assessment of just $176,900.


How much money can a country club save? Let’s look at one example: the Columbia Country Club in Chevy Chase. Its 44.01-acre property has a land assessment of $44,000. Curiously, this club’s property falls below the 50-acre threshold in state law. Legally, it may not even be eligible for an agreement with SDAT.


Due to the undervaluation of its land, the club’s total property assessment is now $7,147,266. It owes $73,574.06 in county and state property taxes this year.


The National 4-H Council is right down Connecticut Avenue from the Columbia Country Club. Its 12.28-acre commercial property has a land assessment of $9,628,500 – or $784,079.80 per acre.


If we applied the same per-acre assessment value to the Columbia Country Club, its 44.01-acre land parcel would be assessed at $34,507,352. Its total property value including its $7,129,800 in improvements would be $41,593,152. At its current state property tax rate of 0.112 and its current county property tax rate of 0.916, the club would be paying $427,577.60 in property taxes – about six times its current amount. So the Columbia Country Club’s agreement with SDAT (which may not even be allowed by state law) is cutting 83% off its property tax bill. And the club’s agreement enables it to realize those savings as long as it does not sell its land for subdivision.

This law is both extremely expensive and totally unnecessary. All county governments have zoning and subdivision rules that limit development. For example, the Columbia Country Club’s current zoning is R-90 (single-family housing with minimum 9,000-SF lots). If the club did sell its land, under current zoning a developer would only be allowed to build 150 or so homes there. The county could hinder development there even more by installing even less-dense zoning. The point is that other land use management tools can be used to preserve open space – which is not truly “open” when it lies behind country club gates – without giving away millions of dollars to the super-rich.

The state government will be rapidly cutting health care, education and services to the poor. If that is indeed necessary, then the Great Country Club Tax Break must also be repealed.