Printable VersionToday’s News-Herald
One hundred percent recovery costs on Lake Havasu City General Fund subsidized services could eliminate the number of participants in many recreational and aquatics programs and force other programs to be cut, Finance Director Gayle Whittle said at Tuesday’s work session of the City Council.
Council is facing the choice of eliminating, raising fees or maintaining current fees on the general fund subsidized services, and Whittle says recreation services might be the best area, because many of the services could reasonably have fees raised or be cut to save revenue.
The cost of raising fees could keep many regular participants from affording to stay in the program.
“One of the benefits of living in the city and providing a high quality of life was providing some of these programs,” Whittle told the council. “The problem that we are running into is the same that we are running into in some of the other areas. These programs were subsidizing a lot of money.”
In order to keep many of the recreational programs, the council was faced to choose to eliminate other tax-supported services or raise fees for many of the programs to cover the cost of providing them.
One hundred percent recovery costs on services such as the adult lap swim, open gym and youth basketball might be too high for many residents to participate.
The city had previously raised fees for participants in horseshoes, which led to the city losing their league.
The city could consider dropping many of its adult sports programs and having outside organizations pick up the sponsorship responsibilities. The city would still provide the fields and courts for sporting leagues like softball and volleyball.
Several of the general fund subsidized programs are costing the city more than they are recovering. Whittle pointed to pool parties and private rentals at the Aquatic Center. Together, the two services are costing the city $106,000 more than they are recovering, an amount that is only 39 percent of the cost.
Aquatics classes are being subsidized at more than $677,000, Whittle said. She pointed out the pool is a community resource to be utilized, but it is costing the city a lot of money to provide services.
The council members said they would like to see a cost recovery amount closer to 100 percent on services or programs such as pool parties.
Whittle said if the council chose to continue such services at the same rate, they would need to subsidize those services by reducing or eliminating other services.
“The departments going to have to make a decision to eliminate some of these programs, because we can’t afford to pay for them all, if you raise no fees,” Whittle acknowledged.
She noted the current projection for the 2009-10 city budget did not factor in projected increased fees.
Whittle also anticipates the total recreational budget would be around $2 million for the upcoming fiscal year. She said half of that money is going to after-school programs.
“That means that the other $1 million has to come from all these other programs, and you can see we have subsidized a lot more than $2 million,” Whittle said.
Whittle asked the council if the after-school program was important enough to spend $1 million over what the program is producing in revenue.
Council member Lee Barnes pointed out raising fees on the after-school program could likely price many kids out of the program. Council member Dean Barlow acknowledged this as well, stating eliminating many kids from the program could cause more financial problems in other areas.
Fees would have to be raised to keep the city’s current recovery cost on many of the recreational services, Whittle refuted.
Barlow acknowledged a minimum raise in fees of around a $1 would probably not have a major impact on the number of participants and would allow the city to keep many of their recreational services.
Council granted the after-school program as a necessity. Barlow said he would like to see a slight increase in the current cost recovery of the after-school program of 27.5 percent could be raised to 30 percent without a major financial impact to its participants.
Mayor Mark Nexsen stated at some point the city would have to make the simple decision, provide services like aquatics classes, table tennis or flag football and make cuts in other departments or raise fees in these departments to bring in more revenue. The other option is to cut some of these recreation programs.
Council’s ultimate decision before the next budget cycle could have a drastic impact, based upon what Nexsen said. Nexsen indicated he knew cutting some of the programs would be tough to cut, but several were bleeding the city for millions of dollars.
“If we don’t do it here, that means we are going to have to take money out of some other department, police or fire, Public Works or whatever,” Nexsen said. “While I understand that we need to make sure that our young people and our seniors are taken care of, you have to ask yourself — to what extent do you want to do that? Do you want to do that by reducing policemen and firemen? That’s what it is going to boil down to.”
Since Tuesday’s meeting was a work session, no official cuts were made. The city departments are due to take the council’s suggestions and investigate which services and programs they could realistically cut back on or increase fees for and bring their findings back to the council at a later date.
You may contact this reporter at twaggoner@havasunews.com.
Article Rating