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Financial Overview FY2021
It is important to calculate the true cost of service for programs, facilities, amenities, events, etc. to understand the cost, where funds come from, to identify the benefit and translate into a unit cost (per mile, per hour, etc.). It costs to try things; it is important to determine what is the cost as a lot of time and a lot of money goes into preprograms with little return on investment and its BPARD’s fiduciary responsibility to minimize that including subsidized offerings. It is critical to establish cost recovery and identify what costs to be recovered prior to implementation and follow the department’s business principles, Proforma’s, Business Plans and KPI’s.
Business Principles
Know the difference between and investment and an expense. An expense cost you money an investment is supposed to make you money.
Know that from programs to facilities - People don’t build things without securing the operational dollars to operate it and maintain it. - Data drives the majority of operational and capital decisions - Equity, Diversity, and Inclusion principles are in place to manage access for all and capital decisions. - All budgets are combined for revenues and expenses to give true financial picture. - Revolving funds are used to improve facilities and programs.
PRO FORMA
Is an accounting product use to forecast expected revenues based on how much is that going to cost, including start up costs and the length of time to recover based on evidenced based research for cost recovery, projecting how the revenue will climb each year and then pay for the costs to pay for it?
BUSINESS PLAN
Deeper and more strategic than the using a proforma it allows for more flexibility, for unanticipated shortfalls (ex – COVID-19, weather, or incidents) with the use of historic data to make better decisions for forecasting and look back on prior years. It is important to ask questions before investing public funds in new program or offerings:
- Why the program? Why are you starting this, answer first. - Should you? - Is someone in the private sector doing this? - If so, are they missing the audience you are targeting, - Who are our customers? Know who our customers are – research this, targe this, not only our community, research the industry – who else is doing this, are they successful at it? If not, don’t do it, don’t saturate it.
Establish the understanding of the money part of offerings- the revenues, expenses, equipment costs, and staffing. OPEB – FED making them set aside, part time vs FTE, other partnerships (not have to do all by yourself) Tracking both direct and indirect cost- whatever cost you have to put on event, program – indirect everything else – cell phones, vehicles, salary, - every single dime accounted for.
Marketing and promotions.
- Who is your market, how much do they spend?
- What is the Market capacity – how many based on facility/court/ hours – many used only during the evening, vs daytime – look at differential pricing for non-peak times instead of example build more courts. Must identify the capacity.
Assess efficiency of space - instead of going to the public for a bond measure for a new building can we lease empty retail space and use. Track efficiency of space. - non-prime time use is difficult to sell, the best agencies get space used 60-70% of the time is good.
Train employees to have an understanding of the philosophy of services – core, essential, private, public, etc. the value of different prices.
Identify different funding sources to determine how to supplement costs and establish a pricing policy, pricing plan in place, especially for enterprise funds. Brownsville Events Center had City Commission approve their pricing policy for the first time in July 2021. Which included a process for off peak or non-prime time discounts and non-profit discounts.
Classification of Services are established to help guide the PARD pricing strategy. Private services are at the top tier of service and competing with private industry and usually full cost of service (golf lesson, personal training session, etc.) while public services that benefit the community overall are at cost or may be subsidized.
KEY PERFORMANCE INDICATORS (KPI)
This tool is used to help to demonstrate the efficiency and effectiveness of the operations and track things how they are. For example, how often are the rooms used, which ones make money, assess where they are in their life cycle to terminate as needed with data as the justification so that a small user group isn’t benefitting.
510 - Administration
FY21 Amended Budget - $7,967,650
Expenditures Revenue % RecoveryAdopted Revenue % Adopted Rev Revenue ytd Prior
$437,982 $ - 0% -$ 0% $ -
511 - Recreation 512 - Parks & Trails 513 - Swimming Pools 514 - City Cemetery 515 - Civic Pavilion 822 - Youth Recreation
$549,272 27,712.00 $ $2,776,403 10,086.50$ $542,104 $ 82,096.44 $75,655 $ $410,328 73,330.00$ $212,569 4,980.00$
5% 50,000.00$ 0% 20,000.00 $ 15% 80,500.00$ 0% -$ 18% $ 70,000.00 2% $ 70,000.00
516 - Events Center 505 - Golf Center $785,290 $ 146,013.00 $814,144 $ 358,690.93 19% $ 261,000.00 44% 372,975.00$
862 - Sports Park $1,363,903 32,823.14 $ 2% $ 130,000.00
2017 CO Funds ($999,413.08) $273,133.00
$8,240,783 $735,732 9% $1,054,475
GF Total $5,004,313 EF Total $2,963,337.00
55% 2,885.00$ 50% 13,557.50 $ 102% $ 105.00 0% $ 105% 30,755.00 $ 7% 24,972.50$ 56% 165,824.00$ 96% $ 267,102.66 25% $ -
70% $505,202
Table 1
BPARD has 3 Enterprise Funds with a combined budget of $2,963,337. Cost recovery of 17% or $505,202.
Golf - FY21 recovered 44% of budgeted expenditures but recovered 96% of adopted revenue goal ($372,975) prior FY actuals (CV19 impact) was $267,102.66.
BEC – FY21 recovered 19% of budgeted expenditures but 56% of adopted revenue goal ($261,000) prior FY actuals was $165,824.
BSP- FY21 recovered 2% of budgeted expenditures and 25% of adopted revenue goal (130,000) prior FY actuals was $0. BSP was used a COVID-19 testing site, and other pandemic related services.
PARD Revenue & Expenditures – As seen in the Table 1 the BPARD recovered 9% of its FY21 budgeted expenditures total expenditures for General and Enterprise funds. In efforts to combat the decline in revenue actual expenditures of $6,041,318 reducing expenditures by 24% department wide due lack of revenue due to the Covid-19 pandemic PARD closures. The Brownsville Sports Park was the division that spent the least, 46% of allocated budget as it experienced the most drastic revenue decline of all divisions due to its role in supporting pandemic recovery response city wide.
2017 CO Funds were $999,413.08 for PARD park improvements the remainder for FY21 to be expended was $273,133.00 for fencing, restroom renovations, and pool improvements.
Capital Outlay FY21 – Improvements: $100,000; Safety $0; Technology $72,000; Equipment $192,000 were allocated to address PARD needs.
PARD General Fund adopted budget of just over $5M dollars, 55% of the budget goes to Parks and Trails operations, followed by 11% Recreation and Pools each; then Administration at 9% and Ringgold Civic Pavilion (events rental venue) at 8% of the budget allocation then followed by Youth Recreation 4% and Old City Cemetery using 2% of the PARD general fund budget.
Program Service Determinants
“Beyond its value as a form of sociability, recreation also provides major personal benefits in terms of meeting physical, emotional, philosophical, and other important health-related needs of participants. In a broad sense, the leisure life of a nation reflects its fundamental values and character.”
Recreation & Leisure in Modern Society Pg. 2.
The department and its employees must understand the conceptual foundations of play, recreation, and leisure and adapt as society does. It is also important to offer and plan for a variety of recreation and leisure experiences for the individual or group as everyone seeks different leisure outcomes and has different motivations for participation, a person-centered approach to play, recreation and leisure activities offered.
