Hershey Trust's new student campus polarizes small Pa. town

[Editor's Note: An incomplete version of this story was mistakenly published online Wednesday without the Hershey Trust's comments and was then taken down. This is the complete version.]

In the summer of 2013, Tom and Cindy Royer bought two lots with frontage on one of central Pennsylvania's premier golf courses, owned by the super-rich Milton Hershey School.

The family wanted to live on a golf course, Tom Royer says. And its 7,900-square-foot dream home on the Hershey Links course would come with a doored-off children's study, detached three-car garage, and a large home office.

The Royers didn't know it then, but the Hershey School for poor children had other plans that would lower their home's value dramatically: It would close the Hershey Links course and rezone it for student housing.

Today, Royer looks out his back porch not on grassy fairways and rolling hills, but into a bleak construction site bordered by a permanent 5-foot-high earthen wall of pine trees and shrubs.

"The [Hershey] Trust had a blank check to do whatever it wanted to do," Royer said. "You have a gorgeous golf course behind these homes. You are going to plow that under and the value won't change," Royer said. "What drugs are you on?"

Royer has successfully lowered his home's tax assessment twice since he moved into his house in August 2014 -- knocking 45 percent off his home's market value, or about $858,300, county and state records show.

At least five other homes around the Royers' on the former Hershey Links also have seen a decrease of 17 percent to 37 percent in their assessed value, county records show.

Hershey Trust spokesman Kent Jarrell said in a statement Wednesday that some home assessments have been revised next to the former golf course but that the overall assessment value of 21 high-end homes close to the former golf course has risen $1.7 million since 2012 -- or an estimated $2.3 million in market value, based on state figures.

"Additionally, two lots were purchased last fall and consolidated with the new owner intending to construct a new home, which will further increase overall value," Jarrell said. "We believe there will be continued long-term positive overall impact of the value of the surrounding properties."

South Hanover officials who supported the Hershey School's plan for a new campus in the town say that the charity can generally do what it wants with its land and that homeowners shouldn't expect it to operate a money-losing golf course.

While long criticized for its board compensation and cronyism and for failing to do more to educate poor children, the Hershey School has also upset its neighbors and upended politics in this small town northwest of Hershey.

Many residents opposed the 2015 rezoning of the charity's 200-acre golf course as tax-exempt for student homes and now fear a deeper intrusion by the politically powerful school, one that could take yet more of its 10,000 acres off the tax rolls.

One of the nation's richest charities, the Hershey School was created by Milton and Catherine Hershey in 1909 as an orphanage and trade school. It owns the Hershey chocolate and tourism empires, creating a gusher of cash that makes its $12.5 billion endowment the largest for a private school in the nation, and bigger than all but a few elite universities'.

With 2,000 boarding students, the Hershey School is under court mandate to use more assets to help more poor children.

But the school has declined to open satellite schools outside of the Hershey area and has high per-student costs: about $118,000 a year -- almost double the cost of a year at Harvard University.

The institution has been criticized for the grand scale of its construction projects. The new student campus in South Hanover will cost $120 million, including the original cost of the golf course.

The state attorney general, which oversees charities, has investigated the trust many times and reached settlements in 1994, 2002, 2003, 2013, and 2016 over such issues as board self-dealing, high compensation, lack of educational expertise, long tenure, and inadequate enrollment.

The charity's purchase of the Hershey Links golf course was the target of the 2013 investigation in part because the venture seemed ill-advised and never panned out.

The charity bought the money-losing course in 2006 for $12 million, an inflated price based on an appraisal's report, from a group of local investors that included a former Hershey board member. The Hershey School announced it would close the golf course during that attorney general investigation in early 2013.

Separately, three Hershey School board members quit in late December as part of a settlement in July 2016 with the attorney general, shrinking the board's size to six members.

The Hershey Trust owns "the property and they have the right within the township to develop it within the town's ordinances," said Henry Shipman, the former head of the South Hanover planning commission. "If you want to control how a property is developed in the United States, the right to ownership will prevail."

Robert Cassel, the former chairman of the South Hanover Board of Supervisors, said the new student campus was the "best option" for the town once the Hershey School closed the golf course.

South Hanover zoning would have allowed one home per acre if the charity developed the 200-acre course for a housing subdivision, Cassel said. That would be a much higher density than the 30 to 35 homes the charity is building.

Cassel noted that the school would be financially responsible for the roads and infrastructure on the new student campus and that the school would contribute funds to the local school district.

In a bruising political fight, the South Hanover Board of Supervisors voted 3-2 to rezone the golf course in February 2015 as tax-exempt for the student campus. But the controversy continued to simmer during the May primary for two open supervisor seats.

In those races, an incumbent supervisor and the planning commission's Shipman, both proponents of rezoning the golf course as tax-exempt, were soundly defeated on the Republican ticket by two candidates opposed to the rezoning.

One of those candidates, Rebecca Boehmer, lives near Royer in a home with frontage on the former Hershey Links. Said Boehmer, who is now the chair of the South Hanover Board of Supervisors: "We are not against kids." But there was "every reason to say no" to the Hershey School to rezone the golf course because of the cost to the township, she said.

"We basically could find nobody who was in favor of the rezoning," Boehmer said. "It was evident in the public hearings that there was overwhelming opposition to the rezoning and the public outcry was expressed in the subsequent election."

Royer said he understands that business conditions change as it relates to the golf course.

He also said the charity did make some accommodations on its new campus. He asked that trust officials not build multistory McMansion-style houses and they agreed.

Perhaps, though, the last straw was the 5-foot earthen wall running just beyond his backyard. He calls it the "Hershey Wall."

Royer said he might seek an additional downward tax assessment on his new home. "It's the only way I can get back at what's going on. I can pay less in taxes, which is in reality not what I want to do. You have public officials to look out for the public as a whole. It was almost like they were working for the Hershey Trust."