Funding Luxury? Par for the Course

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Peanut butter and jelly. July 4th and fireworks. Baseball and hot dogs. Farm Credit and golf?

It’s an unlikely pair, but recent news reports confirm that it’s starting to look more normal every year.

Following reports that Carolina Farm Credit underwrote publicly backed loans to maintain a luxurious private golf course, the Farm Credit System (FCS), through its affiliate CoBank, has made the news again.

According to Monica Mendoza of the Denver Business Journal, “CoBank has picked up the naming rights for The Colorado Open Championships in a five-year-deal worth $1.5 million.” Not only has CoBank committed to sinking $1.5 million of government-backed funds into securing the naming rights, they’ve also elected to provide sponsorship that “covers the $250,000 purse for three tournaments.”

Bob Engel, CoBank’s CEO, added that they’re “Delighted to be succeeding HealthOne as title sponsor and look forward to enabling these fantastic tournaments to continue.” CoBank seems content to continue to brazenly put taxpayer money at risk, so where will it end? Will the NFL see a CoBank Stadium in the next few years? When will Congress act to keep the FCS in check?

All this from the FCS, a government-sponsored enterprise (GSE) just like Fannie Mae or Freddie Mac, that may soon need yet another taxpayer-funded bailout.

Loans to small farmers earning a living for themselves is one thing; loans for one-off luxury events is another. Who would have guessed that when CoBank says it “serves vital industries,” it means golf tournaments? We sure wouldn’t have.

Looks like CoBank might have to call a mulligan on this one.