A closer look at recreation center financing
The Berthoud Recreation Center at Waggener Farm Park held its grand opening on Saturday morning with much fanfare. The rec center and associated amenities were approved and financed after a lengthy period of debate, both inside and outside of town hall.
In 2018, Berthoud voters rejected Ballot Issue 3J – the sale of $30 million in bonds with a repayment cost of $59 million – while voting in favor of Issue 3I, the institution of a 1% sales and use tax increase to finance “expanding and improving the existing town trail system; renovating or replacing existing aquatics facilities; developing, constructing and equipping a recreation center and related facilities; developing, constructing and equipping athletic fields; and constructing, acquiring, equipping, and operating park and recreation improvements,” according to the ballot language.
Following the rejection of 3J, the Berthoud Board of Trustees voted 4-3 to finance the facility using Certificates of Participation (COPs), basically a lease-to-own measure whereby the town incurred debt without having to issue bonds. The town was able to secure interest rates at near-historic lows for the COP financing to fund the facilities at Waggener Farm Park.
The town projects to receive $1,987,375 in sales tax revenue from 3I in 2022, for use for all town recreation expenses, as outlined in the ballot language. According to the town budget, not yet finalized or approved, but presented to the Board of Trustees on Nov. 9, the town projects rec center operation costs of $1,840,755 and debt financing from the COPs of $1,132,400 bringing the total cost of operations to $2,973,155. Revenues projected to be generated by the rec center, from memberships, daily use fees and the like of $2,871,775.
At Saturday’s grand opening, Town Administrator Chris Kirk stated in prepared remarks that the rec center had sold “about 490” memberships prior to the grand opening event. Speaking with the Surveyor on Monday morning, Kirk said, “I would assume we are over the 550 mark and maybe even to 600 at this point, but I haven’t got the report yet,” after enthusiastic Berthoud residents lined up to sign up.
Kirk said that, not just regarding the rec center or recreation in general but as relates to all expenses, the town “budgets conservatively,” under-estimating best-case-scenario revenue and over-estimating worst-case-scenario costs. “We want to be really conservative from both an expense standpoint and a revenue standpoint,” Kirk said.
In the initial budget projection for the rec center that was presented to the board on Oct. 12, town staff has estimated $3,316,867 in operating expenses but revised that number downward significantly to the $1,840,755 mark presented on Nov. 9. Significant decreases in expenses were found primarily in costs of salaries and benefits for employees; the line item for rec center administration salaries were reduced from $512,316 to $186,600 between the two budgets and in the aquatics center budget from $652,529 to $68,300. Other town departments saw some increases in budgets; the Parks budget increased by $475,655 between the two budgets and saw a 52.59% increase in funding from 2021 to 2022, Park Development (+43.62%), Public Facilities (25.06%) and Forestry (+156.75%) also saw significant funding boosts year-over-year.
Kirk explained that during the budgeting process a great deal of expenses were initially allocated for salaries that turned out to be un-needed. Kirk explained that each individual part time employee was budgeted based upon a 1,000 hours per year, while many individuals will not work that much, e.g. the front desk staff might have four employees but only need 15 waged hours per day, rather than the 40 hours initially budgeted.
“Our personnel costs were over-estimated significantly, so we went through and changed our methodology for calculating those that was much more accurate,” Kirk said.
Kirk did state the town projects to see increasing memberships year over year going forward, at least in the short term, given the growth in the area. While new options could open in the area, such as private facilities solely for exercise, Kirk and staff believe the attrition would be offset by growth in the area.
“There is a practical reality that you’re going to lose members but you hope to gain new ones. When 500 new homes are being built that’s probably 1,000 new people and you’re hoping to capture a portion of those to offset a natural decrease in membership,” Kirk said.
Kirk also stated that the popular senior fitness program Silver Sneakers has been approached by the town, beginning in March, and that, “we still feel really confident we will still be accepted as a facility … that just hasn’t happened yet.”
- June, 04 2015
Bennet Soricelli enjoys a piece of candy as he watches last...
- April, 23 2015
By May Soricelli The Surveyor The Tatum family, from left, includes...
- June, 08 2018
By Rudy Hemmann The Surveyor Most people in town have noticed the steadily increasing number...
- May, 22 2020
By Ryan Armagost The Surveyor This Memorial Day is a challenging one, as we have...
- July, 26 2018
By Dan Karpiel The Surveyor On Thursday, July 12, the Berthoud Parks, Open Space, Recreation...
- April, 24 2020
Photo by Sergeant Badberg - Berthoud bicycle Deputies Fay and Schultz. By Shelley Widhalm The...
- A closer look at recreation center fi...
- Board approves engineering and infras...
- Busy night for town board