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DRAFT
Recreation Cost of Service Analysis
City Council Presentation
May 20, 2025
Presenters: Jessie Myott, Manager, BerryDunn
Ranjana Maharaj, Deputy Director of Community Services – Recreation, City of Richmond Antonio Banuelos, Accounting Manager, City of Richmond
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Agenda
Project Scope
Analysis Summary
Engagement Summary
Recommendations & Considerations
Questions and Discussion
3 On June 27, 2023, City Council adopted a resolution excluding recreation fees from the approved Master Fee Schedule, leaving the fees as is and providing direction that further analysis be conducted on the recreation fees.
The City Council also requested that the following principles for setting fees be included:
(1) Public resources for the public good - fees should maximize public use and benefits; (2) Social equity - prioritize access for historically excluded groups and address barriers; (3) Ability to pay - costs should be covered by those most able to pay; (4) Sustainable and sufficient revenue - ensure revenue sustains quality services without being prohibitive; and
(5) Alignment with City Council priorities - fees should match approved priorities.
City Council Action – June 27, 2023
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Project Background & Scope
The City partnered with BerryDunn to prepare a Recreation Cost of Service Analysis. This study aimed to evaluate the level of effort and resources that the City’s Recreation Department expends on service delivery. The focus of the project is reviewing all revenue generated from user fees and charges for recreation activities, programs, facilities, and services and the identified expenses associated with providing all services.
5 Full Cost Modeling and Analysis
Identifying and analyzing the full cost to provide
recreation services to the community
PAST
Review, analyze, and
discuss the fiscal
environment and service
delivery objectives FY
2022 - 2024
PRESENT
Review, analyze, and
discuss the fiscal
environment and service
delivery objectives in
FY 2025 and identify
challenges and opportunities
FUTURE
Develop forecasts designed
to support service delivery
objectives and growth
FY 2026 – 2028. Develop
fiscal scenarios projected to
provide the resources needed
to meet objectives.
6 Full Cost Modeling and Analysis
All Services (framework demonstrating full cost)
4 Current Core
Service Areas
Included
2 Indirect
“Buckets”
Recreation Admin
General Fund
Admin
Convention Center
Aquatics
General Recreation
Community Centers
7 Summary of Findings
Recreation Services: FY 2022 – FY 2028 (projected)
• Average Revenue FY 22 - 24: $1,305,911*
• Average Revenue FY 25 - 28: $1,296,262* (-0.7%)
* Includes park/facility rental revenue
• Average Expense FY 22 - 24: $6,051,547
• Average Expense FY 25 - 28: $8,939,891 (+47.7%)
39.7% 39.8%
35.2% 30.3% 30.0% 29.8% 29.2%
21.6% 20.8% 22.3%
14.8% 14.6% 14.4% 14.2%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
FY 2022 FY 2023 FY 2024 FY 2025 (est) FY 2026 (proj) FY 2027 (proj) FY 2028 (proj) Recreation Services: FY 2022 - FY 2028
Revenue Expense Cost Recovery w/o Admin Cost Recovery w/ Admin 8 Summary of Findings
Core Service Areas: FY 2026 - FY 2028 (projected)
Cost Recovery w/o Admin or Capital
14.5%
4.3%
49.1% 48.5%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
Community Centers General Recreation Aquatics Convention Center Revenue Expense Cost Recovery
9 Summary of Findings
Core Services: FY 2026 - FY 2028 (projected) – Percent of T otal Revenue
21.1%
3.5%
43.0%
32.4%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
Community Centers General Recreation Aquatics Convention Center Revenue Percent of Total Revenue
10 Summary of Findings
Estimated Cost Recovery T arget Scenarios for Growth
May Translate into Fee Increases
Scenario FY 2026 FY 2027 FY 2028 CR/Rev Growth
Current 26.4% 26.3% 25.8% -
Least Aggressive 27.0% 27.4% 28.0% 2% – 3% / $100k
Moderate 28.2% 29.9% 30.0% 5% – 6% / $175k
Most Aggressive 29.4% 30.1% 31%+ 7% – 9% / $250k
11 As part of the Department’s CoS analysis,
BerryDunn conducted an online community
engagement effort using the Social Pinpoint
platform. This initiative provided residents
with several tools to share their
perspectives—an online survey, a budget
allocation exercise ("Fund It"), and an
interactive idea wall.
Engagement Summary
**More than 330 survey responses received, 744 visitors, and 389 contributions** 12 Future Considerations
Establish Cost Recovery Ranges:
BerryDunn recommends setting targeted ranges of cost recovery related to specific activity, program, and service categories.
Fee Schedule Updates:
BerryDunn recommends that the Department continue to review and update fees on a periodic basis, as needed. This may help to increase revenue generation and meet cost recovery targets.
Service Level Demand:
BerryDunn recommends that in conjunction with the financial reviews performed, the Department should also monitor and review demand, trends, and non -municipal competition to help assess and calculate fee levels to reflect actual demand for activities, programs, and services.
Non-Financial Factors:
BerryDunn recommends that consideration be given to non -financial factors when assessing and setting fee levels for services (e.g., perceived benefit received). 13 Continued Support Equitable Access to Facilities
In July 2022, City Council approved the creation of new Fee Waiver and Partnership Policies to ensure equitable access to recreation services while supporting strategic community partnerships.
14 City Council Options for Consideration Regarding Recreation Fees
1. No Changes to Current Recreation Fees (City staff’s recommendation) a. The fees will remain at their FY 2024-25 levels as part of the city-wide Master Fee Schedule b. The Department will continue to review its fees and recommend updates for City Council consideration on an annual basis
c. Recreation staff will continue to implement the Council-approved Fee Waiver and Partnership policies to increase access to city spaces
d. If there are no increases to Recreation fees, the impact to the City’s General Fund may increase
2. Increase Recreation fees by 3.6% based on the Employment Cost Index (ECI) a. City staff would adjust Recreation’s fees to align with the Master Fee Schedule’s ECI Index for FY 2025-26
b. This increase could increase revenue by approximately $42,120 based on FY 2025-26 revenue projections
3. Increase Recreation fees by an amount other than the ECI of 3.6% a. The City could set cost recovery targets based on the following:
i. Establish a level of cost recovery for the overall fees for Community Services-Recreation. 15 15
berrydunn.com
Questions and
Discussion