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` Douglas Recreation Center * Section V- Operations The operations analysis represents a conservative approach to estimating expenses and revenues and was completed based on the best information available and a basic understanding of the project. Fees and charges utilized for this study reflect a philosophy designed to meet a reasonable cost recovery rate and future operations cost and are subject to review, change, and approval by the project committee. There is no guarantee that the expense and revenue projections outlined in the operations analysis will be met as there are many variables that affect such estimates that either cannot be accurately measured or are subject to change during the actual budgetary process. Expenditures Expenditures have been formulated on the costs that were designated by Ballard*King and Associates to be included in the operating budget for the facility. The figures are based on the size of the center, the specific components of the facility, and the hours of operation. All expenses were calculated to the high side and the actual cost may be less based on the final design, operational philosophy, and programming considerations adopted by the Client. Douglas Community Recreation Center – A community center with an gymnasium, indoor play structure, birthday party rooms, multipurpose community room with a serving kitchen, walking/jogging track, game room, teen area, fitness center with cardiovascular and weight lifting area, aerobic room, child watch area, support offices, administration area and lobby. Approximately 70,000 square feet. Category Facility Budget Personnel Full-time1 $ 586,300 Part-time2 $ 547,613 Total $1,133,913 Operation Cost Model cont. 1 Line item detail and listing of full-time positions can be found on page 4. 2 Line item detail and listing of part-time positions can be found on page 5. ---PAGE BREAK--- ` Douglas Recreation Center * Category Facility Budget Utilities3 $240,000 (gas & elect) Water/sewer $ 28,500 Employee Services $ 3,750 Communications $ 6,000 Contract services4 $ 40,000 Training/Conference $ 6,500 Rental equipment $ 2,000 Advertising/promotions $ 45,000 Bank charges5 $ 7,500 Trash $ 2,600 Insurance6 $ 50,000 Others $ 2,500 Total $434,350 Category Facility Budget Office Supplies $ 15,000 Food Supplies $ 40,000 3 Rate factored at $4.00/SF for balance of the building. It should be noted that the rate for natural gas and electricity have been volatile over the past year and could result in substantially higher costs for utilities over time. 4 Contract services includes HVAC, IT services, elevator, fire alarm system, music, office equipment, custodial services and copy machine services. 5 Includes bank fees for processing credit card and electronic fund transfers (FTE) 6 Insurance for property and general liability. ---PAGE BREAK--- ` Douglas Recreation Center * Pro-Shop7 $ 7,500 Janitorial Supplies $ 15,000 Rec. Program Supplies $ 28,000 Chemicals $ 22,500 Uniforms $ 4,000 Printing $ 15,000 Maint/Repair Materials $ 12,000 Dues/Licenses/Subscriptions $ 2,500 Misc. $ 1,500 Total $163,000 Capital Replacement Reserve8 $ 75,000 Grand Total $1,806,263 7 Accessory items such as shampoo, lotions, locks, swim diapers, etc. designed for sale at the front desk. This is not dedicated retail space within the center. 8 Capital needs will be minimal during the first year of operation since most equipment and operating systems will be under warranty. It is strongly recommended that a sinking fund be established with a goal to build adequate reserves that meet future capital needs. American Public Works recommends planning for 2%-4% of construction cost for capital and maintenance needs. Since maintenance costs have been factored into this pro-forma, a target for building the sinking fund to a level of $250,000 is desirable. ---PAGE BREAK--- ` Douglas Recreation Center * Staffing levels: Positions Facility Budget Full-Time Facility Manager $ 70,000 Aquatic Supervisor $ 50,000 Youth Program Supervisor $ 50,000 Customer Service Supervisor $ 50,000 Maintenance Supervisor $ 50,000 Adult Program Supervisor $ 50,000 Maintenance Worker $ 38,000 Building Attendant $ 68,000 Secretary/Admin Clerk $ 35,000 Salaries $451,000 Benefits (30% of salaries) $135,300 Total Full-Time Personnel $586,300 Note: Pay rates were determined based on the market conditions in Douglas. The positions listed are necessary to ensure adequate staffing and provide for a full-time staff member presence during all open hours of the facility. The wage scales for both the full-time and part- time staff positions reflect estimated wages for 2015. ---PAGE BREAK--- ` Douglas Recreation Center * Positions Hours/Wk Facility Budget Part-Time9 Front Desk 194 hrs/wk $ 103,887 ($10.50/hr) Gym Attendant (24 wks) 46 hrs/wk $ 9,936 ($9.00/hr) Gym Attendant (15 wks) 52 hrs/wk $ 7,020 ($9.00/hr) Birthday Party Host 24 hrs/wk $ 11,016 ($9.00/hr) Fitness Attendant 58 hrs/wk $ 26,622 ($9.00/hr) Lifeguards (36 wks) 434/hrs/wk $ 148,428 ($9.50/hr) Lifeguards (15 wks) 535/hrs/wk $ 76,237 ($9.50/hr) Head Lifeguard 53 hrs/wk $ 28,382 ($10.50/hr) Concession Attendant 75 hrs/wk $ 34,425 ($9.00/hr) Program Instructors10 Fitness $ 36,000 General $ 17,280 Aquatics $ 21,000 Salaries $ 520,233 Benefits (7.65% of part-time wages) $ 39,797 Total Part-Time Salaries $ 560,030 9 A detailed schedule by position begins on page 12. 10 Some programs and classes will be on a contractual basis with the center, where the facility will take a percentage of the revenue collected for the program. These programs have not been calculated in this budget at this time. ---PAGE BREAK--- ` Douglas Recreation Center * Revenues The following revenue projections were formulated from information on the specifics of the project and the demographics of the service area as well as comparing them to national statistics, other similar facilities and the competition for recreation services in the area. Actual figures will vary based on the size and make-up of the components selected during final design, market stratification, philosophy of operation, fees and charges policy, and priority of use. All revenues were calculated conservatively as a result. Revenue Projection Model: Category Facility Budget Fees11 Daily Admissions $ 139,740 Annual Passes $ 432,000 Flow Rider $ 200,812 Rentals $ 37,840 Total $ 810,392 11 Detailed breakdown on fees can be found on page 18. ---PAGE BREAK--- ` Douglas Recreation Center * Revenue Projection Model cont. Category Facility Budget Programs12 General $ 40,160 Fitness $ 7,488 Aquatics $ 62,325 Total $109,973 Other Pro-shop $ 15,000 Special events $ 16,500 Concessions $115,000 Birthday Parties $ 42,000 Total $188,500 Grand Total $1,108,865 12 Detailed breakdown on program fees and participation levels can be found beginning on page 19. ---PAGE BREAK--- ` Douglas Recreation Center * Expenditure – Revenue Comparison Category Facility Budget Expenditures $1,806,263 Revenue $1,108,865 Difference ($697,398) Recovery percentage 61% This operational pro-forma was completed based on the best information available and a basic understanding of the project. However, there is no guarantee that the expense and revenue projections outlined above will be met as there are many variables that affect such estimates that either cannot be accurately measured or are not consistent in their influence on the budgetary process. Future years: Expenditures – Revenue Comparison: Operation expenditures are expected to increase by approximately 4% a year through the first 3 to 5 years of operation. Revenue growth is expected to increase by 5% to 10% a year through the first three years and then level off with only a slight growth or less) the next two years. Expenses for the first year of operation should be lower than projected with the facility being under warranty and new. Revenue growth in the first three years is attributed to increased market penetration and in the remaining years to continued population growth. In most recreation facilities the first three years show tremendous growth from increasing the market share of patrons who use such facilities, but at the end of this time period revenue growth begins to flatten out. It is not uncommon to see the amount of tax support to balance the community center budget increase as the facility ages. Five-Year Revenue-Expense Comparison ---PAGE BREAK--- ` Douglas Recreation Center * Years Expense Revenue Difference Recovery % Base 1,806,263 1,108,865 ($697,398) 61% 2016 1,869,482 1,164,308 ($705,174) 62% 2017 1,934,913 1,216,702 ($718,211) 63% 2018 2,002,163 1,265,370 ($736,793) 63% 2019 2,062,227 1,309,657 ($752,570) 64% Hours of Operation: The projected hours of operation of the community center are as follows: Monday – Friday 5:30am to 9:30pm. Saturday 6:00am to 9:00pm. Sunday Noon-8:00pm Hours per week: 103. Hours usually vary some with the season (longer hours in the winter, shorter during the summer), by programming needs, use patterns and special events. ---PAGE BREAK--- ` Douglas Recreation Center * Fees and Attendance Projected Fee Schedule: Revenue projections will be calculated from this fee model. The rate listed is the cost of an annual pass broken down into twelve equal payments and does not include any handling fees. It should be noted that bank draft convenience for customers would encourage more annual pass sales. However, there are bank fees and a substantial amount of staff time spent managing the bank draft membership base and consideration should be given to pass on some form of a handling fee for bank draft customers. Category Daily Annual Cost Adult Discount $ 7.00 $300 $25.00 Adult $10.00 $360 $30.00 Youth Discount $ 5.00 $180 $15.00 Youth $ 8.00 $240 $20.00 Senior Discount $ 3.00 $180 $15.00 Senior $ 7.00 $240 $20.00 Family Discount $20.00 $720 $60.00 Family $30.00 $780 $65.00 Corporate NA $300 $35.00 The fee schedule above was developed as the criteria for estimating revenues. Actual fees are subject to review and approval by the Douglas Community Recreation Center Steering Committee. The Cost column provides an illustration of the breakdown of an annual membership cost by category and is not intended as a fee option. ---PAGE BREAK--- ` Douglas Recreation Center * Attendance projections: The following attendance projections are based on the revenue figures that were identified earlier in this report. The admission numbers are affected by the rates being charged, the facilities available for use, and the competition within the service area. The figures are also based on the performance of other similar facilities in other areas of the country. These are averages only and the yearly figures are based on 360 days of operation. Yearly paid admissions Facility Budget Daily 16,830 (330 weekly admission) Annuals 89,960 (865 sold annually) Total Yearly 106,790 Total Daily 296 Admission for pass holders were figured based on 104 visits per year for the Community Center. Family admissions were counted as only one admission. Multiple admissions represent twenty admissions per unit sold. Note: Attendance for other events, programs, and spectator functions is difficult to predict but a best guess estimate is approximately 2.5 times the number of paid admissions. Community centers are traditionally the busiest from November to March and Mid-June to Mid-August and are slow from April to early June and again from mid-August to the end of October. Weekdays between the hours of 4pm and 8pm are the busiest times of the week, and weekends are also very busy during the winter months. In contrast, mid-morning and early afternoons on weekdays are usually slow as well as weekends during the summer months (especially Sundays). ---PAGE BREAK--- ` Douglas Recreation Center * Section VI – Part-Time Worksheets Part-Time Staff Hours Time Hours Staff Days Total Hours/Wk Front Desk Mon-Fri 5:30am – 9:30pm 16 1 5 80 3pm – 9pm 6 2 5 60 Saturday 6am – 9pm 15 2 1 30 Noon-4pm 4 1 1 4 Sunday Noon – 8pm 8 2 1 16 1pm-4pm 3 1 1 3 Total 194 hours Gym Attendant (32 wks) Mon-Fri 4pm-10pm 6 1 5 30 Sat/Sun. Noon-8pm 8 1 2 16 Total 46 hours ---PAGE BREAK--- ` Douglas Recreation Center * Time Hours Staff Days Total Hours/Wk Gym Attendant (15 wks) Mon-Fri 1pm-9pm 8 1 5 40 Sat/Sun. Noon-6pm 6 1 2 12 Total 52 hours Fitness Attendant Mon-Fri. 8am-Noon 4 1 5 20 4pm-8pm 4 1 5 20 Saturday 9am-9pm 12 1 1 12 Sunday Noon-6:00pm 6 1 1 6 Total 58 hours Birthday Party Host Friday 7pm-9pm 2 2 1 4 Sat/Sun Noon-5pm 10 2 1 20 Total 24 hours ---PAGE BREAK--- ` Douglas Recreation Center * Time Hours Staff Days Total Hours/Wk Head Lifeguard Mon-Fri 3pm-9pm 6 1 5 30 Saturday 6am-9pm 15 1 1 15 Sunday Noon-8pm 8 1 1 8 Total 53 hours Lifeguards (36 wks) Mon-Fri 5:30am-9:00pm 15.5 2 5 155 3:30pm-9:00pm 5.5 3 5 82 4:00pm-8pm 4 1 5 20 Saturday 6am-9pm 15 2 1 30 Noon-9pm 9 4 1 36 Sunday Noon-6pm 6 6 1 36 ---PAGE BREAK--- ` Douglas Recreation Center * Time Hours Staff Days Total Hours/Wk Flow Rider (36 weeks) Wed/Fri 4pm-8pm 4 3 2 24 Saturday Noon-9pm 9 3 1 27 Sunday Noon-8pm 8 3 1 24 Total 434 hours Lifeguards (15 wks) Mon-Fri 5:30am-9:00pm 15.5 2 5 155 1:00pm-4:00pm 3 4 5 60 4:00pm- 9:00pm 5 3 5 75 Saturday 6am-9pm 15 2 1 30 Noon-5pm 5 4 1 20 5:00pm-9:00pm 4 3 1 12 Sunday Noon-6pm 6 6 1 36 ---PAGE BREAK--- ` Douglas Recreation Center * Time Hours Staff Days Total Hours/Wk Flow Rider (15 weeks Mon-Fri 1pm-8pm 7 3 5 105 Saturday Noon-8pm 8 3 1 24 Sunday Noon-6pm 6 3 1 18 Total 535 hours Concessions Attendant Wed-Fri 3pm-9pm 6 2 2 24 Saturday Noon-9pm 9 3 1 27 Sunday Noon-8pm 8 3 1 24 Total 75 hours ---PAGE BREAK--- ` Douglas Recreation Center * Program Staff Cost Fitness Type Games/hrs Weeks Rate Cost Aerobics 10 48 $30.00/hr $14,400 Weight Training 2 48 $30.00/hr $ 2,880 Pilates/Yoga 4 48 $35.00/hr $ 6,720 Youth Fitness 4 48 $30.00/hr $ 5,760 Kick Boxing 2 48 $30.00/hr $ 2,880 Spinning 2 48 $35.00/hr $ 3,360 Total $36,000 General Type Hrs/wk Weeks Rate Cost Youth in Motion 4 48 $15.00/hr $ 2,880 Dance/Tumbling 4 48 $15.00/hr $ 2,880 Martial Arts 4 48 $15.00/hr $ 2,880 Arts/Crafts 8 48 $15.00/hr $ 5,760 Senior Classes 4 48 $15.00/hr $ 2880 Total $17,280 Aquatics Type Classes Sessions Rate Cost Swim Instructors (37 wks) 96 4 $11.25/hr $ 4,320 Swim Instructors (15 wks) 120 5 $11.25/hr $ 6,750 Private Lessons 150 Annual $15.00/lessons $ 2,250 Water Fitness 32 12 $20.00/hr $ 7,680 Total $21,000 ---PAGE BREAK--- ` Douglas Recreation Center * Section – Program Fees and Revenue Worksheet Daily Admissions Category Number Fee Daily Revenue Adult 30 $10.00 $ 300.00 Adult Discount 25 $ 7.00 $ 175.00 Youth 75 $ 8.00 $ 600.00 Youth Discount 60 $ 5.00 $ 300.00 Senior 15 $ 7.00 $ 105.00 Senior Discount 20 $ 3.00 $ 60.00 Family 20 $30.00 $ 600.00 Family Discount 30 $20.00 $ 600.00 Total Weekly 330 $2,740.00 x 51 weeks = $139,740 (per week average) Flow Rider Category Number Days Fee Revenue Day Pass 75 104 $7.50 $ 58,500 Day Pass 165 115 $7.50 $142,312 Total Flow Rider $200,812 Annual Passes Category Number Fee Daily Revenue Adult Res Discount 175 $300.00 $ 52,500 Adult 25 $360.00 $ 9,000 Youth Res Discount 75 $180.00 $ 13,500 Youth 20 $240.00 $ 4,800 Senior Res Discount 60 $180.00 $ 10,800 Senior 15 $240.00 $ 3,600 Family Res Discount405 $720.00 $291,600 Family 40 $780.00 $ 31,200 Corporate 50 $300.00 $ 15,000 Total Annuals 865 $432,000 ---PAGE BREAK--- ` Douglas Recreation Center * Rentals Category Number Fee Session Revenue Meeting Room 2 $ 30/mtg. 50 wks $ 3,000 Social Receptions 9 $ 500/event annual $ 4,500 Summer BB Camp 30 $ 50/hr 2 wks $ 3,000 Gym Tournaments 6 $ 750/day annual $ 4,500 Pre-School Groups 2 $ 40/visit 48 wks $ 3,840 Racquetball 28 $5/hr 50 wks $ 7,000 Corporate 6 $2,000 annual $ 12,000 Total $ 37,840 General Category Number Fee Session Revenue Dance/Tumbling 24 $ 40.00 8 $ 7,680 Arts/Crafts 30 $ 40.00 8 $ 9,600 Martial Arts 24 $ 40.00 8 $ 7,680 Youth in Motion 30 $ 40.00 8 $ 9,600 Senior Classes 20 $ 35.00 8 $ 5,600 Total $40,160 Fitness – Drop-in Type Numbers Fees Session Revenue Aerobics Drop-in 32 $ 5.00 8 $ 1,280 Aerobics – Sign up 12 $ 48.00 8 $ 4,608 Pilates/Yoga 24 $ 5.00 8 $ 960 Power Flex 0 $ 0 Youth Fitness 0 $ 0 Kick Boxing 0 $ 0 Spinning Drop-in 16 $ 5.00 8 $ 640 Total $ 7,488 ---PAGE BREAK--- ` Douglas Recreation Center * Aquatics Category Number Fee Sessions Revenue Swim Lessons (37 wks) 60 $45.00 4 $10,800 Swim Lessons (15 wks) 75 $45.00 5 $16,875 Private Lessons 150 $15.00 Annual $ 2,250 Water Fitness 60 $45.00 12 $32,400 Total $62,325 Birthday Parties Number Fee Revenue 240 $175.00 $42,000 Other Revenue Category Number Fee Sessions Revenue Pro-Shop – Accessories supplies $15,000