City of Ashland
PARKS AND RECREATION COMMISSION
May 11, 2015
Present: Commissioners Gardiner, Landt, Lewis, Shaw; Director Black; Superintendents Dickens and Dials; Administrative Supervisor Dyssegard, Assistant Manuel
Absent: Commissioner Miller; City Council Liaison, Mayor Stromberg
I. CALL TO ORDER
Chair Gardiner called the meeting to order at 7:00 p.m. in Council Chambers, 1175 E. Main Street.
II. PUBLIC PARTICIPATION
There was none.
III. ADDITIONS OR DELETIONS TO THE AGENDA
There were none.
IV. NEW BUSINESS
Budget Discussion and Action on Potential Amendments to the Operating and CIP Budgets
Black reviewed the process and outcome of the Parks Budget Hearing on May 7 in Council Chambers. The meeting began at 6:00 and ended at 10:00 p.m. The Parks presentation followed the Police Department’s budget overview.
Black stated that the Citizen’s Budget Committee focused on the gap between the funds APRC needed to operate and the dollars provided.
Black noted that the APRC operating budget—previously reviewed by the Budget Officer—still exceeded funding levels by $538,000 despite the removal of $240,000 by the Budget Officer.
In working with the Budget Officer and conducting meetings with Mayor Stromberg and Ashland City Council, it was assumed that the gap would be funded with a transfer from the City of Ashland’s General Fund. This assumption was based on the necessity for a balanced budget. It was implied that by committing to a Performance Audit and continuing to work with the City of Ashland and Ashland’s Budget Officer, the one-time transfer would give the new Parks Director time to create efficiencies and adjust funding to manage the budget within the $2.09 per thousand of incremental tax financing allotted to the APRC each biennium.
Black stated that the Budget Officer’s presentation on May 7 contained information not previously reviewed. The proposed $550,000 transfer from the General Fund was illustrated by percentage, with the gap portrayed as more drastic than the 5% budget increase over the prior biennial budget. Also presented was a spreadsheet that contrasted APRC’s per capita funding as compared with other parks systems in Oregon. The “norm” for parks system funding in Oregon was presented as approximately $1.00 per thousand, with Ashland’s system averaging around $2.03 per thousand. In other words, APRC was portrayed as having a top-tier funding level for Oregon. Black noted that Ashland’s parks system was premier, with Lithia Park alone drawing more than one million visitors per year.
Black continued, stating that the Budget Officer reviewed the cost of maintenance within APRC. Black reflected that it was costly to maintain such a complex parks system. He shared a recent voicemail message from a soccer coach who highly praised the APRC for the quality of school field maintenance. The coach stated that the fields were in exemplary condition as compared with field maintenance over the past five years. Black noted that the compliment was indicative of the management of lands throughout the Ashland Parks system.
The presentation by Gardiner and Black to the Ashland Citizens’ Budget Committee was described as a detailed explanation of the services and value provided by the APRC.
The Budget Committee was reported to have questioned the use of the General Fund transfer. Was it a loan? Black responded that the money was essential to operations and the APRC would pursue every possible option to maximize revenues—through increased efficiencies and financial savings—but there were no guarantees that the $550,000 would remain unspent.
It was noted that in the opinion of the Budget Officer, the $550,000 transfer could not be removed from the APRC budget as the decrease would be too drastic an impact.
Discussion Among Commissioners
There followed further discussion about the use of the transfer and the effect of changes to the tax incremental financing. The traditional surplus in the Parks budget was questioned. Shaw stated that a surplus each year indicated an inefficient budget, since an accurate budget provided a framework to work within as well as direction and control. He said budgets should be utilized but not exceeded.
Landt expressed a concern about the numbers. He recommended further scrutiny and volunteered to assist with finding an explanation for the difference in the prior budget and the proposed budget. He stated that it would be helpful if APRC could explain the difference, given that the methodology was the same. In his opinion, it looked as though the tax incremental financing changed from $2.02 to $2.09 per thousand between each biennium.
Black said it was his belief that the transfer from the General Fund was offered in good faith. He expressed concern about using the funds but reiterated that the funds were needed to operate. He also noted the City’s offer to finance the performance audit, commenting that it would be prudent to finance the audit in-house. He highlighted audit objectives as a primary rationale for financing the project. Black noted that the overarching goal was to reduce dependence upon the General Fund.
Discussion of Alternative Budget Proposal
Black initiated discussion by introducing a proposal designed to reduce the current budget shortfall by $250,000. He indicated that changing the use of the ending fund balance (EFB) would substantially reduce the transfer from the General Fund. He stated that typically the EFB went to the CIP for deferred maintenance, with a smaller amount going to reserves ($292,641 and $100,000, respectively).
Black proposed retaining the EFB of $292,641 in the operating budget, leaving $100,000 in reserves. Black explained that the budget proposed by the Budget Officer was a transfer of $550,000, with a final EFB of $11,373. Black stated that he could not reduce the shortfall by the entire amount because doing so would compromise operations. In response to a question by Landt, Black stated that the EFB of the next biennium would be zero. He noted that it would take time (at least four years) to establish the EFB of 12%.
Under the new budget scenario, the CIP would need to be reduced. Black proposed modifying the scope of two projects and shifting monies within the fund to adjust by $292,641. He expressed confidence that no project would be eliminated completely. The Dog Park could be divided into two phases, and begin this year with the $75,000 currently allotted for the project. $35,000 from the pool bubble would be used to help pay for the performance audit. The bathhouse upgrade could be designed and projected to build in 2017.
Black commented that the pool study would be eliminated but APRC would continue to partner with the YMCA. Gardiner suggested that a feasibility study for the project could be financed by the City, as the pool would be a regional pool – not specifically a Parks project.
Black fielded questions about land acquisition, the Oak Knoll Driving Range project, and other CIP projects. He noted that a bond would help to finance land acquisition. He talked about restricted funds such as the Food and Beverage Tax restrictions – with 20% of those funds going to land acquisitions and $600,000 in cash available. SDC funds were noted as restricted to projects listed in the Parks Master Plan.
Black summarized the changes, noting that the CIP budget was $479,000 less than originally planned, a good start toward meeting the goal of matching the tax incremental financing and eliminating transfers from the General Fund.
It was agreed that Black would clearly identify the project changes when re-submitting the proposed budget.
There followed additional discussion regarding the impact on the Parks budget and the change in direction inherent in the Budget Officer’s presentation. There was a consensus that the financial concerns prompted by the budgetary shortfall could have been discussed in the joint meeting, held prior to the Budget Hearing, thereby giving Parks time to re-evaluate their proposed budget.
Black talked about the reserves, noting a past precedent of channeling 25% of the EFB to reserves. He stated that the target should be approximately 12%, giving some flexibility that would be needed this biennium. He referred back to the shortfall, noting that the current situation was centered upon funding operations. The priorities set by APRC would remain, even though they would be accomplished at a slower pace.
Discussion focused on reasons for budgetary swings and fluctuating revenues. It was noted that many of the services provided by APRC were subsidized. Black provided a comparison to other City Departments, noting that Planning typically recovered approximately 5% of expenses, while Public Works was similar aside from transportation costs. New revenue sources would decrease tax financing, and establishing a taxing district would most likely be rejected by voters, given the amount of tax funding already received by the City of Ashland.
Black stated that APRC would show leadership by working diligently to resolve the funding gap and to work within the tax incremental financing available.
Landt noted that Ashland’s Comprehensive Plan was a significant factor impacting Parks and Recreation. Black said changes to the Vehicle plan also produced an impact.
Black read a rough draft of a memo to the Ashland Citizens’ Budget Committee, paraphrased as follows:
As you are aware, the budget process for the 2015-2017 Biennium has revealed that the Parks Fund is operating at a shortfall due to the Budget Officer’s goal of limiting the budget to $2.09 per capita, unless some action is taken. Parks Administration has responded to this by decreasing the budget by $240,000. The Budget Officer has proposed that $550,000 be transferred from the General Fund in order to balance the budget completely. In addition to the transfer of $550,000, APRC has agreed to undergo a Performance Audit to identify best practices, efficiencies, and benchmarks to help increase revenues while decreasing expenses in this 2015-2017 biennium. The Budget Officer has proposed to pay for this Performance Audit out of City funds. There are various reasons for this deficit, which will change in 2015-2017; however, there are three main budget issues for this need to balance the budget. APRC desires that its dependence on the General Fund be limited to $2.09 per thousand of assessed value if possible. For this reason APRC and its Administration are proposing the following amendments to the proposed budget recommended by the Budget Officer...
APRC will not transfer $292,641 to the CIP for deferred maintenance projects. Instead this ending fund balance amount will be rolled into the operating budget to cover proposed expenses and reduce the requested draw on the General Fund. APRC will still require a transfer in of $250,000 to ensure that the Parks Fund balances but we will only draw on this amount only if it is needed. APRC administration will work to identify efficiencies to be gained within the Commission to limit the draw if at all possible. APRC will still conduct the Performance Audit but rather than requesting additional money from the City to achieve this, we will redirect capital to cover the cost the Audit. APRC will cover the 100% of the cost of the Performance Audit through CIP. In effect, we proposed that the projected transfer in be reduced to $250,000. In addition the CIP should be revised to show new expenditures of $3,817,890.
APRC values its autonomy as an elected Commission, and strives to manage the resources of Parks and Recreation in a manner as stated in the City Charter: that ‘Said Park Commission shall have control and management of all the lands here dedicated for Park purposes, and of all other lands that may be hereafter acquired, by the City for such purposes. They shall have control and management of all Parks funds, whether obtained by taxation, donation, or otherwise, and shall expend the same judiciously for beautifying and improving the City’s parks.’ Thank you for the opportunity to work with APRC …. ..”
MOTION: Landt moved to accept the recommendation of the Parks Director for changes to the CIP Budget and General Budget as laid out in the two documents provided, and that as part of the motion, it was understood that the Parks Director and Commission Chair would write a memo informing the Budget Officer and Budget Committee of the APRC decision. Shaw seconded.
The vote was all yes.
Landt commented that whether it had been intended or not, there had been an erosion of trust because of this budget process. It was agreed that the Commission fully supported the proposal of APRC’s Director.
There followed commentary from Commissioners about the value provided by Ashland Parks and Recreation, the efforts taken to be fiscally responsible, and the quality of the services provided. There were questions about the information provided by the Budget Officer and whether similar processes were in place for other Departments within the City. Landt proposed a review of the information disseminated at the Budget Hearing and he suggested the development of a forum to review the City’s Comprehensive Plan.
V. ITEMS FROM COMMISSIONERS
Shaw noted that he was looking forward to the dedication of Ashland Creek Park, to be held on May 20, 2015.
Gardiner reported that APRC had been asked to co-sponsor a BBQ together with the Ashland City Council. The BBQ would be held on August 30, 2015. The intent was to provide a celebration coming from the elected officials for the enjoyment of all non-elected Committee members and Commissioners who also provided valuable services to the City. Gardiner encouraged attendance.
Gardiner noted that the AHS Senior Prom, held recently, included approximately 40 prom-goers taking their event photos with the Butler-Perozzi Fountain in the background. He expressed pleasure that the APRC was going forward with renovations of the fountain as it was an important icon for many people.
VI. UPCOMING MEETING DATE
Regular Meeting: May 18, 2015 @ Council Chambers, 1175 E. Main St. – 7:00 p.m.
There being no further business, the meeting adjourned at 8:26 p.m.
Betsy Manuel, Assistant
Ashland Parks and Recreation Commission