A member of the Oro Valley town council recently posed the idea of a cash infusion from the General Fund contingency reserve into the Oro Valley Community and Recreation Center Fund for capital improvements at the site.
Councilmember Steve Solomon suggested the transfer at the April 26 special budget study session. Council members were discussing the community center fund as part of the parks and recreation department budget as laid out in the Town Manager’s Recommended Budget for the coming fiscal year.
Also discussed at the study session was the town’s employee benefits program and Oro Valley’s water utility fund.
“I know we are doing some updating at the community center, but there may be a good amount more that we might want to look at,” Solomon said. “I think we really want to take a look at some updating, even fresh paint inside or outside, changing the color scheme.”
The town expects to start the new year in July with $12.2 million in contingency reserves, or 29 percent of total expenditures. According to council-adopted policy, the town must maintain at least 25 percent in reserve funds. Last fiscal year, the town completed roughly $500,000 of a budgeted $1.1 million in renovations and improvements at the community center, and just over $72,000 of a budgeted $527,000 in the current fiscal year by February.
Within the recommended budget is a $50,000 cart improvement project slated for the Cañada course with funding from the dedicated half-cent sales tax. A $75,000 tennis court preservation project is listed, though the funding is from the Bed Tax Fund, and another $75,000 for a water main replacement at the community center via Water Utility Fund cash reserves.
The Pima Association of Governments is also contributing $500,000 to fund the installation of a traffic light at North La Cañada Drive at the center’s entrance.
Separate from capital funds, the community center will benefit from new HVAC units in the short term after council approved an energy efficiency upgrade last May, the installation of which has already begun. The project includes interior and exterior lighting replacements and control systems, pool pump and other water replacements, funded via an excise sales tax.
Much of the decrease from expected capital outlay since the town took over the community center in 2015 has been tied to lower-than-projected revenues, and golf at the community center’s 45 holes has often been involved in the conversation.
In terms of revenue in Troon’s portion of operations, the cash flow has decreased since last year; both golf revenue and membership dues have dropped by roughly $25,000 and $80,000 respectively. This trend was enough to elicit a comment from councilmember Bill Rodman, who said the golf courses needed revenues “badly.”
“It needs folks coming here to spend money in the town that we can point to, to show why this is the right thing to have done and continue to do,” he said.
The recommended budget projects that Troon’s revenues will increase by $340,000. Solomon asked Troon general manager Tom Meade how the figure was calculated, given that Troon’s revenues are projected to end the year at $3.04 million, down $700,000 from the budgeted amount, and next year’s estimate is $3.3 million.
Meade said that the majority of the difference would result from an increase in membership dues. He added that the current year’s figures were a “diluted” revenue stream because of a promotion in which one year’s payment in advance would award 15 months of membership benefits.
Meade said the membership assumption is 251 by July 1. Last calendar year, the fund operated under the goal of 318 memberships by December. At the close of March there were 239 golf memberships. Looking towards the coming fiscal year, Meade said a more consistent revenue stream from dues could result in a $280,000 increase by year-end.
Oro Valley Parks and Recreation Director Kristy Diaz-Trahan said staff would remain “laser focused” on the continuation of its multigenerational approach and programming at the community center to build relationships within the community. Other goals she mentioned included continued—and expanded—tournament and major event play and continuing to grow membership. Diaz-Trahan said the fund started April at 1,339 total memberships, a 46 percent increase since the beginning of the 2015-16 fiscal year.
According to Meade, Troon will look to maintain its golf members with the roll out of a new loyalty program in which members will accrue a rate discount at the end of the next fiscal year based on how long they have been members at the center, which would take effect the following year. Members would be required to fulfill an ancillary spend of $1,150 for family and couple memberships and $650 per year for single member plans. Year over year, membership revenues for town-managed operations have increased by more than $30,000.
Solomon’s suggestion to use contingency fund reserve monies to lay out capital improvement at the community center was only a potential consideration as council moves forward, though it did gain some support from another member of council.
“I think we need to be looking at, over the course of the next several months, whether we want to move some general fund money over to do those one-time expenses that will have a return on the investment,” Rodman said.
The Council has dipped into general fund reserves to fund the community center in the past; $1.2 million was pulled from the reserve in 2015 to front the first few months of operations and improvements. A 10-year repayment plan for the internal loan was approved by council at a term of $120,000 every year, though council did suspend the first payment last summer.
Tentative adoption for the budget is slated for Wednesday, May 10 at 6 p.m. and final adoption is scheduled for Wednesday, June 7 at 6 p.m., both taking place at council chambers, 11000 N. La Cañada Drive.
