Before You Sign the 2027 Dues Letter: Club Costs Are Up 38% Since 2019

October is when the budget gets approved and the dues letter gets drafted. Before the board settles on a number for 2027, it is worth looking at what that number has to pay for. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that the 1,382 tax-exempt 501(c)(7) clubs that reported in every fiscal year from 2019 through 2024 carry a cost base that has grown by 38.1 percent in five years, from $8.63 billion to $11.92 billion.

The good news is that revenue grew faster. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that revenue is up 42.4 percent to $12.63 billion, and that the share of clubs spending more than they took in fell from 45.4 percent to 29.7 percent. The less comfortable news is underneath. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that the share bottomed out at 19.2 percent in fiscal 2021 and has drifted back up since, and that in the latest year expenses grew faster than revenue at 666 of the 1,382 clubs, nearly half the panel. Any conversation about a country club dues increase in 2027 starts there.

Five Years of Cost Growth, in One Number

The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that total expenses across the panel rose by $3.29 billion between fiscal 2019 and fiscal 2024, roughly 6.7 percent a year compounded; that revenue added $3.76 billion over the same span, about 7.3 percent a year; and that the median club tells the same story, with median expense growth of 37.7 percent against median revenue growth of 43.1 percent. The Bureau of Labor Statistics table “All Items (1982-84=100), U.S. City Average,” published by the BLS with monthly values through December 2024, reports a CPI-U annual average of 255.657 in 2019 and 313.689 in 2024 (the 2024 average calculated from the monthly values), a 22.7 percent rise, which means the cost base in these filings has climbed considerably faster than the general price level members see every day.

That gap is the first thing a dues letter has to explain. Members will likely anchor on headline inflation. The club’s own cost base has moved on a steeper line, and the filings show it plainly.

The path was not smooth. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that expenses fell 5.2 percent in fiscal 2020, the pandemic year, and that revenue fell 5.0 percent alongside them. Then costs came back, and fast.

The sequence matters. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that in fiscal 2021 revenue jumped 13.5 percent while expenses rose only 6.1 percent, which is why that year looks so good on paper; that in fiscal 2022 the order flipped, with expenses up 15.9 percent, the steepest annual increase in the panel, against revenue growth of 11.2 percent; that fiscal 2023 was close to even, with expenses slightly ahead at 10.2 percent against 9.5 percent; and that in fiscal 2024 the aggregate tilted back toward revenue, 8.5 percent against 7.4 percent, with the median club looking similar at 7.1 percent against 6.6 percent.

The Deficit Share Bottomed in 2021

The cleaner way to see what happened is to count the clubs whose reported expenses exceeded reported revenue in each year. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that in fiscal 2019 that was 627 of the 1,382, or 45.4 percent, and that by fiscal 2021 it had fallen to 265, or 19.2 percent. It has not been that low since.

The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that the median margin traces the same arc: 0.8 percent in fiscal 2019, a peak of 9.7 percent in fiscal 2021, and 4.8 percent in fiscal 2024, while the panel’s combined surplus went from $235 million in fiscal 2019 to $877 million in fiscal 2021 and settled at $714 million in fiscal 2024.

The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows revenue recovering before costs did in fiscal 2021, which makes the likeliest reading that it was an unusual year rather than a new baseline. The 990 does not say why costs then caught up, so any explanation would need to be tested against a club’s own books. The deficit share is still well below where it was before the pandemic, but the direction since 2021 has been the wrong one.

Size does not protect a club as much as one might assume. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that in fiscal 2024, 34.8 percent of clubs under $5 million in revenue reported expenses above revenue, with a median margin of 2.8 percent; that clubs between $10 million and $20 million did best, at 21.7 percent; and that the 104 clubs above $20 million came in at 31.7 percent, a higher share than the $5 million to $10 million band at 28.2 percent.

Six Clubs, Two Directions

The aggregate hides wide variation. Six large clubs show both outcomes, and none of the figures below should be read as a judgment on how any one of them is run. A capital project, a debt payoff or a one-time assessment can move either line in a given year, and the 990 does not say which. The ProPublica Nonprofit Explorer profiles named under the chart below, each built from the club’s own Form 990 filings, report fiscal years ending in December for Desert Mountain Club, Detroit Athletic Club and Westchester Country Club, in June for Union League of Philadelphia, in September for The Olympic Club and in October for Congressional Country Club.

Revenue outrunning costs. Congressional Country Club in Bethesda, Maryland is the clearest case. The ProPublica Nonprofit Explorer profile “Congressional Country Club Inc,” published by ProPublica (Form 990 data through the fiscal year ended October 2024), reports that in fiscal 2019 the club had $35.6 million in expenses against $35.4 million in revenue, and that by fiscal 2024 revenue had grown 46.1 percent to $51.7 million while expenses grew 34.1 percent to $47.8 million, and in the latest year alone revenue rose 16.8 percent against expense growth of 6.4 percent. Westchester Country Club in Rye, New York followed a quieter version of the same pattern. The ProPublica Nonprofit Explorer profile “Westchester Country Club Inc,” published by ProPublica (Form 990 data through the fiscal year ended December 2024), reports revenue up 29.1 percent over five years to $51.2 million, expenses up 24.1 percent to $48.8 million, and revenue ahead again in fiscal 2024, 8.6 percent to 7.0 percent. The Olympic Club in San Francisco ran almost dead level over five years. The ProPublica Nonprofit Explorer profile “Olympic Club,” published by ProPublica (Form 990 data through the fiscal year ended September 2024), reports 31.9 percent revenue growth against 32.7 percent expense growth over the five years, before a fiscal 2024 in which revenue rose 16.9 percent and expenses 11.0 percent, to $77.8 million and $73.1 million.

Costs outrunning revenue. The ProPublica Nonprofit Explorer profile “The Union League of Philadelphia,” published by ProPublica (Form 990 data through the fiscal year ended June 2024), reports that the club grew revenue 69.5 percent over five years, to $87.3 million, which would be a remarkable number on its own, while expenses grew 86.5 percent, to $84.9 million. The ProPublica Nonprofit Explorer profile “The Union League of Philadelphia,” published by ProPublica (Form 990 data through the fiscal year ended June 2024), also shows the gap between the two lines narrowing from $6.0 million in fiscal 2019 to $2.4 million in fiscal 2024 (our subtraction of the reported figures), and expenses rising 7.9 percent against revenue growth of 4.7 percent in the latest year. Detroit Athletic Club shows the same direction at a smaller scale. The ProPublica Nonprofit Explorer profile “Detroit Athletic Club,” published by ProPublica (Form 990 data through the fiscal year ended December 2024), reports revenue up 33.2 percent to $47.3 million, expenses up 38.1 percent to $44.2 million, and a fiscal 2024 in which revenue rose 3.0 percent while costs rose 6.3 percent.

Desert Mountain Club in Scottsdale sits on both sides. The ProPublica Nonprofit Explorer profile “Desert Mountain Club Inc,” published by ProPublica (Form 990 data through the fiscal year ended December 2024), reports that over five years its revenue grew 58.6 percent to $108.3 million, comfortably ahead of expense growth of 50.2 percent to $95.4 million, but that in fiscal 2024 expenses rose 8.1 percent and revenue 7.6 percent. The panel shares that pattern. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows that in fiscal 2024 expenses outgrew revenue at 666 of the panel’s 1,382 clubs, so a long-run cushion is no guarantee about the latest year.

Read the Deficit Line Carefully

Before any of this goes into a board deck, two accounting points need to be on the table. The IRS “Instructions for Form 990” list depreciation, depletion and amortization as their own line within functional expenses, so total expenses on Form 990 include depreciation, a non-cash charge that rises whenever a club finishes a clubhouse, a course renovation or a new fitness building. A club can report expenses above revenue in a year when it collected more cash than it spent. The PKF O’Connor Davies article “Capital Planning and Financing Considerations for Private Clubs,” published in January 2023, reports that many clubs earmark initiation fee reserves for capital purchases. Because total revenue here includes initiation fees and capital contributions, a club with a strong initiation year can look profitable on the 990 while its operations run short.

So a “deficit” in this data is an accounting result, not a cash shortfall, and a surplus is not proof that dues cover operations. The panel-wide trend is still meaningful. The line for any single club needs its audited statements beside it.

What This Means for Your Club

Benchmark against your own cost curve, not the CPI. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows panel expenses compounding at about 6.7 percent a year over five years. If your board’s instinct is to hold the 2027 increase near headline inflation, put your own five-year expense growth on the first slide and see whether the two numbers agree.

Separate operating, capital and depreciation before you set the number. Because the 990 blends initiation fees into revenue and depreciation into expenses, the operating dues decision needs its own schedule: operating revenue against operating cost, with capital dues and initiation shown separately. In our view, an increase tied to a line members can see lands better than one that is not.

Treat fiscal 2021 as the exception. If your budget model still leans on margins from that year, it is likely too optimistic. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows the panel’s median margin falling by roughly half since then, from 9.7 percent to 4.8 percent.

Check last year’s direction, not just the five-year trend. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, shows nearly half the panel with costs growing faster than revenue in fiscal 2024, and 295 clubs with revenue falling outright. A club with a healthy five-year cushion can still be on the wrong line this year, as Desert Mountain Club’s fiscal 2024 shows.

Show members the cost base in the letter. We recommend naming the categories driving cost growth in the dues letter. A letter that announces only a percentage gives members only the percentage.

How We Did This

The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, defines the panel as every 501(c)(7) club in our database that reported both total revenue and total expenses, with revenue of at least $1 million, in each fiscal year from 2019 through 2024: 1,382 clubs. Holding the panel constant means the trend reflects the same clubs year to year rather than clubs entering or leaving the data. The dataset “IRS 990 Filings on AWS,” published by AWS Open Data (2013 to present) and analyzed by Private Club Marketing, also counts 1,621 clubs that filed fiscal 2024 returns, including those outside the constant panel, with 29.9 percent reporting expenses above revenue, close to the panel figure. A fiscal year is labeled by the year it ends; the ProPublica Nonprofit Explorer profile “The Union League of Philadelphia,” published by ProPublica (Form 990 data through the fiscal year ended June 2024), reports a June fiscal year end, so its fiscal 2024 ended in June 2024. Total expenses include depreciation. Total revenue includes initiation fees and capital contributions. Growth rates are aggregate unless labeled median, and compounded annual rates are our arithmetic on the five-year totals. The IRS page “Social Clubs” says social clubs are generally required to file annual returns, so for-profit clubs, including developer-owned and corporate-owned clubs, are not included. The IRS announcement “IRS Makes Electronically Filed Form 990 Data Available in New Format” describes the release of e-filed Form 990 data as XML. Nothing here is accounting or tax advice.

For the retention side of the same decision, see our September analysis of the breakeven math behind a dues increase, and for the communications calendar around the letter itself, October marketing ideas for budget approval and the dues letter.

Sources: “IRS 990 Filings on AWS,” AWS Open Data; Private Club Marketing club database; ProPublica Nonprofit Explorer profiles for individual clubs; U.S. Bureau of Labor Statistics, “All Items (1982-84=100), U.S. City Average,” CPI-U; PKF O’Connor Davies, “Capital Planning and Financing Considerations for Private Clubs,” January 2023. Fiscal years are labeled by the year the reporting period ends. Only 501(c)(7) tax-exempt clubs are included.