01-21-2020-WS - Laserfiche WebLink

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Page 1 of 2 ITEM – 1E MEMORANDUM DATE: January 21, 2020 TO: Honorable Mayor and City Councilmembers Dave Perrault, City Administrator FROM: Sara Knoll, Parks and Recreation Coordinator Todd Blomstrom, Interim Public Works Director / City Engineer Gayle Bauman, Finance Director SUBJECT: Recreation Programs Review Budgeted Amount: Actual Amount: Funding Source: N/A N/A N/A For Council Consideration City staff was requested to provide information on the City’s recreation programs related to the percentage of costs being covered by revenues. This memorandum describes program revenue and expenses over the past 12 years, an initial comparison of recreation programs in other cities, and an analysis of specific recreation programs provided in 2018. Background Attachment A provides a summary of the revenues and expenditures for programs offered at Arden Hills for the years 2007-2018. Program revenue has generally covered a majority of “Direct Costs” for programs, consisting of temporary employees, supplies, materials, services and charges (second row from bottom). However, revenues have not covered total program costs, which consists of direct costs plus administration personnel (bottom row percentage). The highest total cost coverage ratio is 52.7% which occurred in 2011, with the average total cost coverage ratio being 46.3%. During our examination of historical records, it was noted that up until 2007 the City was able to use a portion of its charitable gambling funds to cover some of the recreation costs. It was also noted in a 2001 memo, that the formula being used to justify programs was that the revenues collected needed to cover direct program costs plus 40% of overhead costs. With the loss of charitable gambling revenue, the current goal is for revenue to cover direct program costs with property taxes covering the overhead costs (administration personnel).