New rec center creates budget uncertainty
Sky-Hi Daily News
Grand County, Co Colorado
Creating a budget with an unknown Goliath like a new recreation center can be a challenge. A lot of guesswork is involved, from estimating class sizes to utility bills.
Fraser Valley Metropolitan Recreation District Director Scott Ledin said he encouraged a conservative approach as he gathered information from his departments for the 2010 budget.
The board approved the $4.5 million budget, 5-0, despite a few concerns.
Board member Greg Gallavan highlighted $1 million in salaries and a projected $200,000 overall loss for the Grand Park Community Recreation Center as his primary worries.
Ledin said the projected loss assumes the worst.
For the rec center’s $1.1 million budget, membership revenues were estimated at conservative levels, he said. The rec center will need to sell some $400,000 in memberships to meet budget.
As of opening day, Friday, Dec. 18, it had sold about $20,000 in memberships. In addition, the district will need to sell at least $250,000 in punch tickets and daily admissions to meet budget goals.
Fitness class revenues were budgeted only to cover the cost of the instructors. Ledin said that if classes fill up and memberships sell, the bottom line number could end up looking a lot better.
Utility bills are another concern. Ledin based the $215,000 utilities budget on bills from other rec centers, he said.
Even with the conservative estimates, the rec center is expected to endure an operating loss of $260,000 in 2010. Some $96,000 in revenue generated by the operating and maintenance property tax subsidy will help offset that loss. An additional $280,000 operating and maintenance fund will provide a cushion for the unexpected, Ledin said.
Budgeting food and beverage sales at the Pole Creek clubhouse also presented a challenge, Ledin said. The district is planning to keep the restaurant open from January through May this year and is projecting year-end profits of $16,000 for the restaurant. That’s up from a projected $40,000 loss in 2009.
The total $1.64 million golf course budget anticipates a 2010 profit of more than $21,500. In 2009, the golf course is projected to lose a little more than $57,000.
Next year’s budget projects a $50,000 loss for the district overall while still increasing its fund balance by $240,000.
The total .3965 mills for the district, includes .0257 mills for operating and maintenance of the rec center and .3700 mills for the bond debt service, and although the rec center did not adjust its mills, taxpayers will see a 15 percent increase due to the higher assessed property values in for 2009, according to budget documents.
– Reid Armstrong can be reached at 970-887-3334 ext. 19610 or firstname.lastname@example.org.
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