HomeMy WebLinkAbout55C - RESO APPROVING COST RECOVERYREQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
NOVEMBER 17, 2020
TITLE:
ADOPT A RESOLUTION APPROVING THE
COST RECOVERY POLICY FOR THE
PARKS, RECREATION AND COMMUNITY
SERVICES AGENCY
CLERK OF COUNCIL USE ONLY:
❑ As Recommended
❑ As Amended
❑ Ordinance on 1 sl Reading
❑ Ordinance on 2od Reading
❑ Implementing Resolution
❑ Set Public Hearing For_
CONTINUED TO
/s/ Kristine Ridge FILE NUMBER
CITY MANAGER
RECOMMENDED ACTION
Adopt a resolution approving the cost recovery policy for the Parks, Recreation and Community
Services Agency.
DISCUSSION
On September 15, 2020, the City Council received and approved the Parks, Recreation and
Community Services Agency (PRCSA) Service and Financial Sustainability Study. Through the
action of receiving and approving the study, and a strategy for implementation of
recommendations, the City Council accepted the use of the tools, methods, and strategies the
Parks, Recreation and Community Services Agency (PRCSA) requires to sustain itself for the long-
term.
The PRCSA does not have a current cost recovery policy. Until now, there has not been a full
understanding of cost recovery concepts, and there is inconsistent application of program and
service costs. There is lack of adequate philosophy based on the mission of the PRCSA to establish
adequate and non -conflicting cost recovery targets.
The proposed policy (Exhibit 1) sets forth the underlying principles of the Cost Recovery Philosophy
and service pricing approach. Key elements include the following:
1. Basic level of service is "free" (supported by tax revenues)
2. Fees are a responsible and necessary supplement
3. Community benefit — Use of tax dollars
4. Individual benefit — Use of fees
S. Greater individual benefit — lower rate of tax subsidy
6. The policy considers economic climate, alternative providers, and market rate
7. Fee reductions available for economic need
55C-1
Parks, Recreation, and Community Services Agency Cost Recovery Policy
November 17, 2020
Page 2
A Service and Financial Sustainability Study Implementation Plan (Exhibit 2) outlines 43 goals and
objectives that will be implemented over the next several years, setting a direction for the PRCSA
based on the principles and best practice business tools contained within the report. PRCSA
sorted all of the recommended goals and objectives into two categories. Category 1 consists of
strategies and recommendations that can be implemented within the purview of the City Manager's
delegated authority. Category 2 includes strategy recommendations that require City Council policy
changes and/or other approval prior to implementation.
FISCAL IMPACT
There is no direct fiscal impact associated with this action.
Submitted By: Lisa Rudloff, Executive Director — Parks, Recreation, and Community
Services Agency
Exhibits:
1. Cost Recovery Policy for Park, Recreation and Community Services Agency
2. Parks, Recreation and Community Services Agency Service and Financial
Sustainability Study Implementation Plan
3. Resolution approving a cost recovery policy for the Parks, Recreation and
Community Services Agency
55C-2
Exhibit t
City of Santa Ana
]V� Policies and Procedures
PARKS, RECREATION AND
COMMUNITY SERVICES AGENCY COST
RECOVERY POLICY
City Council Approval
Section:
Date Approved: Number:
The Parks, Recreation and Community Services Agency ("PRCSA") has the following
cost recovery policy:
1. As a publicly financed park system, PRCSA provides a basic level of service free
to the public in exchange for tax dollars; and
2. Fees and charges and other methods to recover costs are considered a
responsible and necessary means to supplement tax revenue and regulate park
use where appropriate; and
3. When establishing fees and charges, the PRCSA will determine the direct costs of
providing services and establish goals to recover those costs; and
4. The appropriate level of cost recovery will be based on an assessment of who is
benefiting from the service provided. If the benefit is to the community as a whole,
it is appropriate to use taxpayer dollars to completely, or primarily, fund the service;
and
5. As the benefit is to an individual or select group of individuals, it is appropriate to
charge fees for the service at an increasing rate of cost recovery. Supervised or
instructed programs, facilities, equipment exclusively used by visitors, and
products and services that may be purchased, provide examples where user fees
are appropriate; and
6. PRCSA shall also consider available resources, public need, public acceptance,
and the economic climate of the community when establishing fees and charges;
and
7. In cases where certain programs and facilities are highly specialized by activity
and design, and appeal to a select user group, the PRCSA shall additionally
consider reasonable fees charged by alternative service providers or market rates;
and
556-3
Exhibit t
8. Fees and charges for use of property can beset to recover costs in excess of direct
and indirect costs, where appropriate (such as market rate for rental of certain City
facilities) and consistent with applicable law; and
9. The PRCSA may subsidize the cost recovery objective of services for persons with
economic need or other targeted populations, as determined by policy of the City
Council, through tax -supported fee reductions, scholarships, grants, or other
methods; and
10.The City Council may also approve exceptional fees or fee waivers upon
determination that the fee arrangements will benefit the public interest.
PRCSA Cost Recover Policy Statement Adopted November 17, 2020 by Resolution No.
2020-OXX
556-4
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55C-17
Exhibit 3
RESOLUTION 2020-XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA
APPROVING A COST RECOVERY POLICY FOR THE PARKS, RECREATION AND
COMMUNITY SERVICES AGENCY
WHEREAS, in March 2019, the City's Parks, Recreation and Community Services Agency
("PRCSA") retained a consultant Greenplay, LLC ("Consultant") to assess all PRCSA programs
and deliver a service and financial sustainability study to the City.
WHEREAS, on September 15, 2020, the City Council was presented the final Service and
Sustainability Report ("the report") prepared by the Consultant.
WHEREAS, one of the recommendations contained in the report was for the City to adopt
a formal policy regarding pricing and cost recovery for PRCSA programs.
WHEREAS, the Consultant recommends a cost recover policy as a strong foundation for
sustainable financial management strategies. According to the City's Consultant, the policy will
allow staff to (1) recognize where a subsidy is being applied, and determine whether it is at an
appropriate level; (2) justify a pricing schedule, including fees for existing and new services; and
(3) evaluate service delivery mechanisms, all to maximize services to the public while assuring
equity in service delivery; and
WHEREAS, the PRCSA in consultation with the City's Consultant has created a cost
recovery policy.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Ana, that:
Section 1. The City Council for the City of Santa Ana hereby finds, declares, and
determines as follows that the City Council approves the Parks, Recreation & Community
Services Agency Cost Recovery Policy attached hereto as Exhibit A.
Section 2. This Resolution shall take effect immediately upon its adoption by the
City Council, and the Clerk of the Council shall attest to and certify the vote adopting
this Resolution.
ADOPTED this_ day of November, 2020.
Miguel A. Pulido
Mayor
Resolution No. 2020-XXX
Page 1 of 2 55C-18
Exhibit 3
IG1»:160ADLF-2CHIle] V diI
Sonia R. Carvalho, City Attorney
By: (IQurl9- A . k
Laura A. Rossini
Acting Chief Assistant City Attorney
AYES: Councilmembers
NOES: Councilmembers
ABSTAIN: Councilmembers
NOT PRESENT: Councilmembers
IN4:illy[yelImte]yeli9*1IfillVQ01wil01IV] : mILIvilIN wo
I, DAISY GOMEZ, Clerk of the Council, do hereby certify the attached Resolution No.
2020 -XXX to be the original resolution adopted by the City Council of the City of Santa Ana on
.2020.
Date:
Clerk of the Council
City of Santa Ana
Resolution No. 2020-XXX
Page 2 of 2
55C-19
Exhibit A
Exhibit 3
City of Santa Ana
I'Vupldl Policies and Procedures
PARKS, RECREATION AND
COMMUNITY SERVICES AGENCY COST
RECOVERY POLICY
City Council Approval
Section:
Date Approved: Number:
The Parks, Recreation and Community Services Agency ("PRCSA") has the following
cost recovery policy:
1. As a publicly financed park system, PRCSA provides a basic level of service free
to the public in exchange for tax dollars; and
2. Fees and charges and other methods to recover costs are considered a
responsible and necessary means to supplement tax revenue and regulate park
use where appropriate; and
3. When establishing fees and charges, the PRCSA will determine the direct costs of
providing services and establish goals to recover those costs; and
4. The appropriate level of cost recovery will be based on an assessment of who is
benefiting from the service provided. If the benefit is to the community as a whole,
it is appropriate to use taxpayer dollars to completely, or primarily, fund the service;
and
5. As the benefit is to an individual or select group of individuals, it is appropriate to
charge fees for the service at an increasing rate of cost recovery. Supervised or
instructed programs, facilities, equipment exclusively used by visitors, and
products and services that may be purchased, provide examples where user fees
are appropriate; and
6. PRCSA shall also consider available resources, public need, public acceptance,
and the economic climate of the community when establishing fees and charges;
and
7. In cases where certain programs and facilities are highly specialized by activity
and design, and appeal to a select user group, the PRCSA shall additionally
consider reasonable fees charged by alternative service providers or market rates;
and
55d-20
Exhibit 3
8. Fees and charges for use of property can beset to recover costs in excess of direct
and indirect costs, where appropriate (such as market rate for rental of certain City
facilities) and consistent with applicable law; and
9. The PRCSA may subsidize the cost recovery objective of services for persons with
economic need or other targeted populations, as determined by policy of the City
Council, through tax -supported fee reductions, scholarships, grants, or other
methods; and
10.The City Council may also approve exceptional fees or fee waivers upon
determination that the fee arrangements will benefit the public interest.
PRCSA Cost Recover Policy Statement Adopted November 17, 2020 by Resolution No.
2020-OXX
55d-21