Sat09202014

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Report details cost-recovery efforts for city recreation services


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Community-supported services for seniors, among other groups, recovered 28 percent of direct costs in 2012-2013.

A report at the Los Altos City Council’s June 17 meeting revealed that the city’s recreation programming is subsidized at a lower rate than some nearby cities.

Los Altos Recreation Director Beverly Tucker told the council that her department – which manages approximately 2,000 activities annually – operated at a combined 89 percent direct cost-recovery level during the 2012-2013 fiscal year.

Tucker said the department recovered 101 percent of its costs related to fee-based programs such as lifelong learning, health and wellness, and performing and visual arts. But community-supported programs for teens, seniors and community events recovered only 28 percent of their costs – with the remainder subsidized via the city’s general fund.

To recover more costs, Tucker’s department introduced market-based fee pricing during the 2013-2014 fiscal year. The department is slated to recover 84 percent of direct programming costs in the current fiscal year, which ends Monday.

Tucker was pleased with her department’s performance, noting that Los Altos outpaced several neighboring cities in cost-recovery efforts for recreation services. Her report stated that agencies with comparable services covered as little as 27 percent (Burlingame) to as much as 80 percent (Menlo Park). Mountain View and Cupertino each recovered recreation costs at a 53 percent rate.

“We knew we were doing well, but it was excellent to see how well we were doing in comparison to cities around us,” Tucker said.

Tucker unveiled a handful of strategies to increase her department’s cost-recovery efforts in the coming fiscal year, such as implementing minor facility rental rate increases for nonprofit groups and fee increases for fields and tennis courts. She mentioned the possibility of adding a specific rental fee for businesses and making more park amenities available for rent, including barbecue and picnic areas.

Council reaction

Some councilmembers noted that while the recovery efforts were a positive step, more could be done in the future. Mayor Megan Satterlee said the city should look at ways to recover indirect costs related to recreation services.

“I think we can pat ourselves on the back for where we are with our direct costs, but I think we need to change the measurement and we need to start showing what is our cost recovery – including all our indirect costs,” she said.

Councilwoman Val Carpenter added that she hopes to see cost recovery increase as well.

“I’d like to see the cost-recovery percentage continue to trend upward – back from the 89 percent (in fiscal year 2012-2013) to the 92 percent level that was achieved in fiscal (year) 2010-2011, if not higher,” she said.

Carpenter expressed concern about the department’s market-based pricing strategy, noting that it could harm local private businesses with similar services.

“If you’re using taxpayer dollars to undercut the pricing of local businesses, I have a problem with that,” said Carpenter, who also expressed reservations about subsidizing recreation programming for teens.

Several councilmembers voiced support for establishing a formal social policy that would outline the types of services and activities subsidized in the future.

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