Switching Gears

With the ever-changing financial climate in municipalities, funding challenges abound as parks and recreation professionals attempt to continue to offer programs and services at previous levels. Distant is the memory of the Giant Stride (a long-extinct piece of playground equipment), and one day, so will the memory of the social model way of operating.

Since the inception of the first municipal parks and recreation departments, the taxpayer has been intoxicated by the social model. Since taxes have funded these departments, the public has felt entitled to various services and programs. For the past 100 years, they were correct, as departments massaged this philosophy by funding programs and services almost totally. On the flip side, the business model seeks to bring in 100 percent of the total cost to operate a program or service (including personnel, materials, support staff, facility/equipment rental, etc.) plus another 10 to 20 percent for current and future maintenance costs.

Choose A Model

How are these models different? In the social model way of thinking, for example, a program’s viability and sustainability rest primarily on numbers. A program’s existence depends on whether there are enough participants or if the activity has enough to warrant reserving/holding a facility and staff. Under the business model, a parks and recreation professional will have figured out the cost analysis, the number of participants needed to fund the event and the target market. Whether or not a program has enough participants to hold an event or activity has less of a bearing on its sustainability than the amount of cost recovered.

Why the move to a business model? The reasons for this shift in philosophy vary from state to state. Some of the current catalysts are tax reform, the housing market decline, a sudden shift or re-allocation of resources, budget/revenue shortfalls and the mismanagement of municipal funds. Unfortunately, when county and city administrators are asked to find areas to trim the fat, parks and recreation departments are usually at the top of the list. This is because sewer, water and roads are a necessity, while after-school arts and crafts programs are not.

Balancing The Budget

To balance budgets, parks and recreation professionals have had to become increasingly resourceful. Additionally, they have been asked to make tough decisions as to which programs and services stay and which go. To reach financial expectations, the departments employ numerous strategies:

· Reduce operating hours of recreational facilities, or close them

· Lay off employees, or offer early retirement

· Create park/facility maintenance work teams/units

· Re-organize

· Contract out current services (i.e., mowing, irrigation, programming)

· Increase fees and charges

· Commercialize municipal facilities and parks

· Partner with other groups, businesses and organizations

There are more strategies than those listed, but these give the reader some insight as to what decisions lay before a department head during trying times. The real strength and leadership of a parks and recreation manager can be found and tested after these decisions have been made. Now, one must sell this (in most cases, unpopular) resolution not only to the county or city administrators above them, but to the staff and public. It is worth mentioning that the first players a manger needs to convince are staff. A well-informed, supportive staff can address concerns the public may have while focusing more on what it will gain.

Supporting The Numbers

The business model, with its revenue-producing, business-planning and statistical-analyzing milieu, can be for the parks and recreation professional as overwhelming as the Internet was and still is for my grandmother. That being said, it is not impossible to redirect an organization’s philosophy. To aid in this transition, several options and tools can be employed:

· Hire a person or group of people to facilitate this transition, develop a business plan, create partnerships, and stimulate revenue growth (a Revenue Specialist)

· Contract with a consulting firm that has had favorable outcomes with other municipalities

· Look to, and model after, other organizations that have successfully made the transition

· Attend conference lectures on the subject

· Build a team within the organization composed of players who have a desire and ability to effect change

Moving to the business model does not necessitate bringing on any additional employees and/or hiring a consultant. A well-thought-out business plan will advise and move a department toward the business model, but only if it is collectively embraced.

At the core of the parks and recreation business model is a philosophy that all services and programs are self-supporting, and, to be so, they need to bring in an additional 10 to 20 percent to cover facility and program maintenance costs. This cost recovery must be built into a program or service business plan. Parents will not continue to send their children to a soccer camp where all the balls are flat, nor will local groups use a facility with a leaky roof. Building in an additional maintenance cost ensures funds are available to offset any potential problems.

Taking a previous, fully subsidized program and attempting to recover 120 percent of what it takes to operate may seem unobtainable and, “for what it will cost, they just won’t pay it.” In some instances, this may be true depending on the program, but in these times it pays to be creative. Instead of fighting over the same target market, partner with alternative service providers that offer similar programming. In many cases, this can be more profitable than running a program solely on one’s own. Sharing resources is the key and a major contributing factor in offsetting costs. What one group does not have, another might, and so forth.

When partnering is out of the question or not economically viable, consider those same service providers-- locally and nationally--to see what they are charging for similar programs and services. The “they just won’t pay it” thought may cease. If you are considering the business model, do an informal survey (through Internet and local providers), and see what the going rates are for similar programs. Chances are you might be shocked to see what the market will bear. This same information that has been gathered will also be a good starting point for formulating a new fee structure.

Business Vs. Service

Are we a service or a business? To be truly a sustainable recreation and leisure provider to the community, a department needs to think like a business and act like a service. Offer programs and services that are balanced, both socially and economically. To this endeavor, tough decisions will need to be made and supported. No longer can programs serve a small ratio of the population; they need to be inclusive.

To build a better community for tomorrow, concessions need to be made between these models. Begin by building goals and business plans; seek less to circumnavigate the world in a day and more to create ways and opportunities to succeed. Seeking to recoup 75 to 120 percent of the cost to operate a program on day one may be difficult and more damaging to the program in the long run. Create funding goals that are challenging, but obtainable, and build on each success. The less a program is subsidized by a department, the more sustainable it will become.

It is apparent some changes are needed if parks and recreation departments are to keep themselves afloat in these challenging times. While some municipalities may not be currently enveloped in a budget crisis, there is still merit in moving from the social model, if not to completely fund a program or service, then to offer it with more features or to a larger percentage of the community. Opportunities for low-income and therapeutic-recreation participants must be built into business plans. All groups that may have been left to other providers before must now be addressed and sought after as possible revenue. In many cases, federal law mandates this inclusion.

We are being asked more and more not only to provide quality services and programs but to make them self-supporting and obtainable by all. For a modern parks and recreation department to be successful, it must embrace both systems. The diverse social and economic climate that makes up our communities calls for this union.

Steve Yeskulsky is a CPRP for the Sarasota County Parks and Recreation department. He has worked in parks and recreation for 12 years, and has two related bachelor’s degrees from San Diego State University. He can be reached via e-mail at syeskulsky@scgov.net.