Expenditures continue to overshadow successes at the Federal Way Community Center.
So far this year, membership at the community center is up, and revenues have increased $147,000 over 2008 figures, supervisor Doug Nelson said. Staff is more focused on customer service and the marketing plan has launched into its second phase. Things appear to be going well.
“We have a positive net income this year and that’s a step in the right direction,” financial services administrator Bryant Enge said.
The good news
The successes are credited to several adjustments made over the past year. Membership costs were modified, adding discounted rates for single adults, senior citizens and couples. Family passes now cover up to six individuals. Group fitness schedules were expanded. Customer service efforts were increased. Adult and youth fitness programs, including swim lessons, kids’ athletic programs and the Biggest Loser competition were introduced or enhanced. The center now hosts more community events and is increasing its rental capacity.
Year-to-date, revenues are up 6 percent from 2008, and pass sales are exceeding 2009 projections by 1 percent, Nelson said.
Drop-in revenues through the third quarter are 2 percent higher ($5,000) than last year at this time, attendance has increased 6 percent year-to-date, and members are coming more frequently, Nelson said.
“For those numbers to increase during tough times is great,” Nelson said.
Marketing plan
Phase two of the marketing plan is wrapping up. Templates for displaying group fitness, pool and gymnasium schedules, as well as the center’s rate structure, are on location. A facility map is available to help newcomers. A brochure geared toward rentals for business meetings, weddings, birthdays and special events is circulating.
“I’ve had a lot of positive responses from our customers, our citizens,” Mayor Jack Dovey said. “We’re doing things that make it a much more accessible place for our citizens.”
A new interactive Web site is due to launch this month. There, potential customers can learn more about the community center before their visit. They can even take a virtual tour.
“There’s good news in revenues. Now the real challenge is figuring out how to control expenses,” Nelson said.
The downside
The costs associated with everyday operations of the center, and those required to accommodate the increase in attendance, outweigh the jump in revenues.
“More people doesn’t automatically mean more money,” Nelson said.
Customer service and operations, especially the pools, are expensive, he said. The community center’s 2009 annual operating expenditures are budgeted at $2,069,859. As of September, expenditures totaled $1,515,862, according to the September financial report.
City staff is currently working with Puget Sound Energy to complete an energy audit and identify energy-saving measures that could help reduce expenditures, city spokeswoman Linda Farmer said.
Subsidy required
The community center, despite its successes, will likely always require a subsidy, Dovey said.
“You can’t expect (recreation facilities) to pay for themselves 100 percent,” he said.
A roughly $300,000 subsidy was planned for the center upon its opening in 2007, Dovey said. That year, the center was subsidized by roughly $426,000, interim city manager Brian Wilson said. In 2008, it received a $528,000 subsidy, and a $555,000 subsidy is planned for this year, Enge said.
After the center’s second year in operation, staff quickly realized the business plan relied too heavily on pass sales and drastically underestimated expenditures. The plan has since been adjusted.
“We are now getting a track record on the community center based on real numbers and usage,” Dovey said.
The facility’s subsidy is budgeted to increase by 5 percent each year until 2014, Enge said. The 5 percent is an inflation rate, he said.
“It does not reflect any anticipation that the revenues are going to go down,” Enge said.
Revenues need to not just grow, but for multiple years, outpace expenditures before the budgeted subsidy will be decreased. However, any additional revenues the community center brings annually will offset the predetermined subsidy for that specific year, Enge said.
