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The Development and Leisure Services budget provides much of the quality of life services in Parry Sound, plus the business development function. This includes Parks and Recreation, the Stockey Centre, the Bobby Orr Community Centre, as well as Building, Planning and Development Services. In total this department’s activities nets out as an about $2.6 million annual cost, and operationally contributes about $2.1 million to the Town of Parry Sound’s 2016 levy. The difference between cost and levy is accounted for by a backing out of the amortization expenses for the various facilities.

Presented below is a summary of the various Development and Leisure Services budgets for 2016 by department. Additional information regarding ‘Other Expenses’ is available in the full 2016 budget document available at the Town’s website.

Parks and Recreation Budget

TOPS 2016 Budget Parks Recreation

Comparison Point: It costs about the same to maintain the Waterfront and the many parks in Parry Sound as it does to manage the winter snow (Public Works Budget).

 

Bobby Orr Community Centre

TOPS 2016 Budget BOCC

The Bobby Orr Community Centre is presented in a slightly different manner, with the original and occasional and improvements costs deducted as an amortization expense. The Net Levy figure of $360K represents the effective operating costs for the Bobby Orr Community Centre. The cost of the original building and subsequent renovations that have been debentured, about $172K annually, are accounted for separately. It’s a bit like taking a car loan. Your annual costs for driving include insurance, fuel, repairs, tolls, etc., plus the cost of the car loan, which includes interest and principle (amortization of sorts). At the end of your payments you own a car. Your real costs to drive a car are more than just the gas you put in the tank. Hopefully, the Bobby Orr Community Centre will retain proportionately more value than a 5-year old Ford once it’s paid off.

Stockey Centre

TOPS 2016 Budget Stockey

The accounting for the Stockey Centre is similar to that used with the Bobby Orr Community Centre. Revenues are offset by expenses to yield a net loss, in this case about $550,000. Removing amortization costs, yields a net levy cost to the Town budget of about $275,000, for annual operation. It’s remarkable to realize that the operating expense for the facility, both the performance hall and the Bobby Orr Hall of Fame amounts to about $1.5 million per year. Getting the net costs down to a more manageable $275K depends on generating significant income from use of the facility. some may complain about the cost to rent the facility, but it’s far from a profit centre.

Building and Planning Services

TOPS 2016 Budget Building Planning

In the case of Building and Planning Services there is no mention of amortization. Presumably it’s covered by general administration amortization, and would represent a relatively small portion of the overall expenses of these departments.

Development Services

TOPS 2016 Development

This budget seems to cover the marketing and promotion activities undertaken by the Town, including events such as Canada Day Celebrations. It’s not clear what is involved in Economic Development Miscellaneous, accounting for half of the total budget, but I imagine that it’s largely staff salaries.

Looking at these costs I have to wonder how much a recreation centre would add to our tax levy. Using numbers I have found for similar facilities in Ontario I would expect the annual cost to be about $600,000 for operations and maintenance, plus another $550,000 per year in amortization, assuming a $10 million facility, 4% loan and a 30-year term. Put the two expenses together and you have $1.1 million in additional annual expense. Even assuming user fees of $200,000 per year (1,000 memberships at $200) the net impact to the Parry Sound levy would be about $900,000, an increase of about 10% on the current rates. Not an impossible figure, but one that would be likely to rankle those who would not make use of the facility. But raising the user fees too high would severely restrict use, and income, as has been the case with the Bobby Orr Community Centre. There is no easy answer or cheap solution.