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ATTACHMENT4 Review of the Oval's Financial Performance Final Comments From 1993-2003 the Oval, and eventually the Skating Center, experienced operating losses (cash-flow only) of approximately $1.5 million. From 1993-1999, the City relied upon other recreation-type revenues and Recreation Fund reserves to cover the losses. Since 2000, the City has also relied upon property taxes to support operations. The Oval's long-term financial viability is heavily dependent on four factors. They include: ] ) Participant levels 2) Participant fee amounts 3) Personnel operating costs 4) Utility operating costs Ice rental, which is derived from items u� and #2, provides 60% of the Skating Center's revenues. No other revenue source provides more than 5%. On the expenditure side, personnel and utility costs account for 75% of the Skating Center's costs. No other cost category exceeds 5%. If the Oval is to remain viable for the foreseeable future, it is imperative that the City stabilize these four factors. To summarize; to remain viable and sustainable the Oval (Skating Center) needs to have a cash infusion, above and beyond current revenues generated by the facility itself, of $250,000 annually. Of this amount, approximately $150,000 is needed to support current operations, and $100,000 is needed for future repairsirenovations. In addition, if the City intends on replaeing/renovating the Skating Center and its components near the end of its useful life (i.e_ prior to mechanical or structural failures), a one-time infusion of cash of approximately $500,000 will likely be needed in the next 5-7 years. This is in addition to any monies that are needed to repairireplace the existing refrigeration unit that is currently failing. �