King County Parks and Recreation Division 2007 Third Quarter Report
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King County Parks and Recreation Division 2007 Third Quarter Report Parks Omnibus Ordinance Report to the King County Council January – September 2007 Highlights of the Third Quarter Overall, revenues through the third quarter are up slightly from the same period in 2006. Traditional field use revenues have risen, particularly at Marymoor Park, due to the four newly renovated artificial turf soccer fields. In August, Starbucks Chairman Howard Schultz and director/producer Norman Lear paid a visit to the newly remodeled White Center Heights Park. Their visit was filmed as part of the award-winning Sundance Channel series “The Iconoclasts”, which first aired on November 15, 2007. The episode chronicles Schultz’s efforts to establish the Starbucks Coffee Company and to incorporate community philanthropy as a corporate value. In the episode, Schultz and Lear tour the park and discuss the importance of engaging community and building places where friends and families can gather and enjoy the outdoors. The Weyerhaeuser King County Aquatic Center has been awarded several major national events that it will host in 2008 and 2009, including: o 2008 NCAA Championships o US Open, Swimming (international, 5-day event, 1000+ athletes) o Speedo Junior National Swimming Championship (national, 5-day event, 1000+ athletes) o Speedo junior National Synchronized Swimming Championship (national, 4-day event, 300 athletes) On Labor Day weekend, Tolt-MacDonald Park and Campground inaugurated six yurts available for public rental. The yurts have been a popular addition the park, both in terms of strong initial rentals and in attracting the attention of hikers, mountain bikers, and other park users. Page 2 of 27 Contents Introduction .................................................................................................... 4 Revenues ........................................................................................................ 5 – 16 Entrepreneurial Strategies ............................................................................. 17 - 20 Agreements with Other Organizations ......................................................... 21 Transferring Assets ....................................................................................... 22 - 23 Community Outreach and Involvement ........................................................ 24 - 27 Financial Plan – Third Quarter 2007 ........................................................ Appendix A Page 3 of 27 Parks and Recreation Division 2007 Third Quarter Report Introduction The Omnibus Parks Ordinance (Ordinance 14509), adopted November 18, 2002, by the King County Council, included this reporting requirement for the Parks and Recreation Division: “The division shall provide a written report to the council, filed with the clerk of the council, at least four times each year, by March 15, June 15, September 15, and December 15, and more frequently as directed by the council by motion, regarding the execution of the division’s duties and responsibilities as established in K.C.C. 2.16.045.E. Following transmittal of each written report, the division shall also make an oral presentation to the council. The written reports and oral presentations shall include, but shall not be limited to, information as to the division’s efforts in: A. Meeting revenue targets under section 7 of this ordinance; B. Implementing entrepreneurial strategies including advertising, leasing and concession agreements; C. Pursuing gifts, bequests and donations, including the value and sources of gifts, bequests and donations received; D. Developing agreements with other organizations to provide recreation services; E. Transferring parks and recreation assets within incorporated areas or potential annexation areas to cities; and F. Community outreach and involvement.” This is our fifth year reporting on the accomplishments of the Division. Quarterly reports were transmitted for each quarter in 2003, 2004, 2005, and 2006. The year 2007 also marks the fourth year of the Parks Levy fund, which was approved by the voters in 2003, with collections to run from January 1, 2004 through December 31, 2007. We have structured the quarterly report to correspond to the ordinance requirements. We welcome your ideas and input. Please do not hesitate to contact Kevin Brown or Tom Koney of the King County Parks and Recreation Division at 206-296-8687 if you have any questions or suggestions. Page 4 of 27 Revenues - Summary Parks and Recreation Division Revenues Total Adopted Revenues, 2007 $22,097,958 Total Estimated Revenues, 2007 $22,173,579 Total Actual Revenues, 2006 $22,120,229 Third Quarter - Business Revenues Only Levy funds, interest earnings, interfund transfers and similar revenues that are not within the control of the Division are excluded from this total. Actual Business Revenues 1 (includes user fees and enterprise and entrepreneurial revenues) January 1 – September 30, 2007 $4,263,645 January 1 – September 30, 2006 $4,260,312 Third quarter actual business revenues in 2007 were similar to the same period in 2006. Even with a reduced asset base (due to transfer of facilities), business revenues still comprise approximately 22% of the total Parks Revenue budget, the same percentage as in 2002, at the beginning of the Business Plan (see charts, following page). The ensuing period has seen transfers of facilities, mostly pools, which generated more than $2,000,000 in revenues. The business revenue forecast on the remaining assets has risen from a total of approximately $2.3 million in 2002 to nearly $5 million in the 2007 adopted budget. 1 Based on ARMS financial reports. Page 5 of 27 2007 Adopted Revenues - $22M CX transfer 14% Intergovernmental (REET) 7% Business Revenues Parks Levy (User fees, 57% Entrepreneurial) 22% 2002 Adopted Revenues - $26M Intergovernmental (REET, Roads, SWM) 6% Business Revenues (Primarily pool/user fees) 22% CX Transfer 72% Page 6 of 27 Expenditures – Summary Parks and Recreation Division Expenditures 2007 Adopted Expenditures $23,084,309 2007 Revised Expenditures 2 $23,848,148 2006 Adopted Expenditures $20,888,426 2006 Revised Expenditures 3 $22,212,171 4 2006 Actual Expenditures $21,155,007 Third Quarter 2007 - Actual Expenditures January 1 - September 30, 2007 $16,481,684 January 1 - September 30, 2006 $15,986,505 With three-fourths of the year having passed, expenditures were 73% of the Division’s annual expenditure budget. This expenditure pattern is in line with historic business trends. In 2006, the Division underexpended its budget by approximately 3%, including carryover encumbrances. In the early years of the levy, the Division deliberately underexpended the budget. The Division was being frugal, due to the uncertain nature of business revenues and the need to build a prudent fund balance. In January 2004, the Division began with a fund balance of zero, but the fund balance in the levy fund now achieves the financial planning target. The Division continues to look for ways to increase efficiencies and control expenditures. Now that it has achieved its target fund balance, the Division intends to continue to more fully expend its appropriated budget on maintaining and operating parks and facilities in 2007, just as it did in 2006. As long as target fund balance is achieved, the Division intends to spend the maximum amount of its expenditure authority on maintaining parks, using levy funds as the voters intended. 2 Reflects automated carryover, 2007 1 st and 2 nd Quarter Omnibus Ordinances and Supplemental Ordinance 15894. 3 Reflects 1st Quarter Omnibus Ordinance. 4 2006 figures are per 2006 ARMS. Page 7 of 27 Revenues - Implementing the Business Plan Key Business Units Marymoor Park Marymoor Business Unit 2007 thru Q3 2006 thru Q3 Change ($) Change (%) Traditional Rev - facilities $108,536 $154,926 ($46,390) -30% Rev - fields $550,563 $164,531 $386,032 235% Non-Traditional Rev - parking $343,207 $289,786 $53,421 18% Rev - campground*** $0 $12,104 ($12,104) -100% Rev - concerts $144,998 $142,177 $2,822 2% Rev - concert ticket sales $8,078 $3,976 $4,102 103% Rev - Subway $17,798 $15,927 $1,871 12% Rev - Pet Garden $4,500 $750 $3,750 500% Sponsors/concessions $38,931 $40,461 ($1,530) -4% Cirque $0 $552,600 ($552,600) -100% Naming rights** $115,000 $105,000 $10,000 10% Revenues - Total (rounded) $1,332,000 $1,482,000 ($150,000) -10% Expenditures (rounded)* $1,532,000 $1,459,000 $73,000 5% * Expenditures include only direct costs and do not include maintenance labor loaned in from other work units ("loan-in labor"). In the year-end (4th Quarter) report, annual expenditures will be reported with annual revenues and compared against the cost-recovery targets established in Ordinance 14509. ** Revenue from Group Health Velodrome was received in the 3 rd quarter and has not yet presented in accounts; however it is reflected in this table. *** No camping occurred at Marymoor in 2007. In 2006, a special allowance for camping was made for specific performances at the concert venue. Page 8 of 27 Third Quarter highlights include: Overall, revenues received at Marymoor Park through the 3rd quarter of 2007 are down from 2006. This is mainly because the Cirque du Soleil did not visit Marymoor in 2007 as it had in 2006. Cirque is scheduled to return to Marymoor in April 2008. Revenue from most other categories has increased. Traditional field use revenues are up dramatically, reflecting revenues brought in from the recently renovated artificial turf soccer fields. Revenue from