Green
Valley Recreation
2011 Annual Budget
September 28, 2010
Green
Valley Recreation (GVR) currently operates thirteen
facilities and one Member Services Center. Each
facility offers a variety of activities, programs,
and classes. It is the mission of Green Valley Recreation
to provide a variety of leisure, recreational and
social activities for our members, and to maintain
our beautiful recreation centers.
One
of the ways we meet the mission is through the budget
process. This year, the operating and capital budget
process for 2011 began in May and ended in September.
GVR management prepared a draft capital budget that
included several large repair and maintenance projects
for roofs, fire alarm and electrical systems, pool
and spa replastering, replacement of fitness equipment,
HVAC (heating and air conditioning) replacements
and other capital additions at various centers.
GVR management also prepared a draft operating budget.
The first draft of the consolidated 2011 annual
budget was presented to the Planning and Fiscal
Affairs Committee (PFAC) for discussion on June
23rd. The budget process included a review of each
income and expense item, a review of our planning
assumptions, the current 2010 balances against the
proposed 2011 budget, and the requirements necessary
to continue meeting our mission. After three PFAC
meetings, the final second draft of the 2011 budget
was presented to the Board of Directors for their
review on September 20th. The 2011 Budget was then
voted on and approved at the Board of Directors’
meeting on September 28th.
Reviewing
the 2011 revenue projections, GVR anticipates consolidated
revenues of $7,269,240, which is $385,771 or 5.6%
higher than the 2010 budget of $6,883,469. The increase
is primarily due to projected growth and higher
fees in New Member Capital Fees of $157,340 and
member dues of $136,204. Higher growth in participants
is also anticipated in programs and instructional
classes of $47,927 and guest card fees of $20,000.
On a percentage basis, member dues account for 83%
of the revenue in 2011. At a time when operating
expenses are increasing in the double digit range,
this is a vital component of GVR’s financial operations.
Another large percentage of revenue is derived in
the programs and instructional events at 9% or $580,000.
Management
took considerable time to review and analyze the
dues and fees schedule for 2011. Several fees were
increased marginally to support the organization’s
increased operational expenses for 2011. Some of
the fee increases proposed for 2011are a $6 annual
increase for member dues from $403 to $409, a $5
increase for a 1-7 day pass as well as a $5 increase
for the first guest card for one year with unlimited
visits. Tenant fee schedules were also expanded.
An analysis of these fees indicated our members
would appreciate having more flexibility with the
number of days, and in many cases, would see a reduced
cost for these fees.
The
2011 balanced expenses and capital projects, a total
of $7,269,240, is 5.6% higher than the 2010 total
of $6,883,469. This increase of $385,771 is primarily
due to a significant increase in capital project
requests in 2011, an $118,934 increase in our water,
gas and electric utilities, and an increase of $101,834
in our furniture and equipment budget of which the
majority is for the fitness and strength equipment
at several centers.
GVR
management also had to look at significant cuts
in the operational expenses to provide the funds
necessary for safety and high priority capital maintenance
projects. Those cuts were in wages and benefits
at $136,883, and repair and maintenance at $88,000.
Several other cuts totaling over $22,000 assured
GVR would balance the 2011 budget while maintaining
the efficiency and effectiveness of our organization
in meeting our mission to serve our members.
While making the decision to cut wages and benefits
by over 4%, GVR also recognized the need to propose
a 1.2% cost of living adjustment, and include a
pay per performance bonus fund for those employee
who exceed expectations. Wages are 49% of the operating
budget, which is 6% below the estimated industry
standard of 55%. GVR continues to contain these
expenses in light of ever increasing health and
other benefit costs.
The
utilities expenses continue to exert pressure for
our facilities’ staff to find new solutions that
will move GVR to improved energy efficiencies. All
utilities are projected to increase dramatically
in 2011, but several projects are approved that
will reduce overall costs and take advantage of
rebate programs. It is not always easy to see those
nuances in the budget, but we want our members to
know that GVR considers cost containment, utility
efficiency, process solutions, and synergies with
our suppliers and vendors our top priority in 2011.
No
contributions are planned in 2011 for the operations
and replacement reserves. The Board continues to
review balances and capital projects to make future
decisions regarding contributions and balances,
currently at $2,464,992.
As
we look ahead to future years with the converging
forces of higher supply and health costs, pressures
on expanding our revenue base, the repair and maintenance
of aging facilities, energy conservation and safety
issues, we know one thing to be true - we live in,
and enjoy, a very unique community with beautiful
recreation facilities. Green Valley Recreation continues
to meet the challenges of balancing the needs of
operations with the needs of our members.
If
you have any questions, please contact Member Services
Center at (520) 625-3440.
Thank
you,
Joyce
Finkelstein
Green Valley Recreation Board of Directors - Treasurer
Chairperson of the Planning and Fiscal Affairs Committee
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