I received an email from a reader about the Wellness Centre and Pool (Pool) in response to my Council Minutes – September 3, 2019 post. Because the email raises questions I have heard from others I thought it might be helpful to dedicate a post in providing what answers I might have. An abridged version of the email is provided below and is followed by my comments on a question by question basis.
I would like to remind folks that I did an earlier analysis of a Pool in 2018 and the implications in a series of four posts titled Wet Dreams. Here are links to the four posts for those who want to take a deeper dive into the numbers and the issues.
The reader’s questions:
“It’s not that I am against a pool but I doubt it is being looked at realistically.
- How much is the maintenance cost & will that be fairly apportioned?
- How much does the town spend yearly on the Bobby Orr Centre? On the Stockey Centre?
- How much does the town spend yearly on the library? It seems to me it is always being asked to pare its (bare minimum) budget.
- How willing have the townships been to contribute to joint use facilities? Many backed out of the library rather than pay their percentage of the costs. As for the arena, not only the townships but the hockey club screamed bloody murder when fair costs were allocated – & the town backed down. Does the museum still receive support from the townships? etc, etc…………!!!!!
It doesn’t take very many years for the original agreements to be forgotten & for the town to be landed with the bill once again.”
Q1 – How much is the maintenance cost & will that be fairly apportioned?
Answer: The costs will be the costs, I previously estimated that it will cost about $700,000 per year without any building amortization or accruals for future replacement. The next question that needs to be asked is how much of that will be covered by users’ fees, presumably memberships and rentals for organized activities? My sense is that revenues will be on the order of $300,000 if the municipalities want to make the facility available to most people. This is a not urban or suburban GTA. This means the facility will operate at an annual loss of about $400,000 per year. Optimistically that figure could be as low as $200,000 per year if membership numbers are higher than expected and rates are raised. Let’s not forget that initial enthusiasm and memberships may decline over the years and budgets need to accommodate this reality.
How it will be apportioned is critical. The template from an earlier Town of Parry Sound council meeting agenda suggested the allocation of expenses for the investigative portion of the process which has a budget of $170,000. That is as close as we can get to some estimate of how the eventual costs will be apportioned. This suggests the annual operating cost allocations as presented in the table below for each of the identified municipalities. (Note: these costs do not include any construction/amortization costs and are likely to go up by about 3% a year with inflation.)
Q2 – How much does the town spend yearly on the Bobby Orr Centre? On the Stockey Centre?
Answer: There are lots of figures I could provide, it’s something I have looked at in the past and more recently have decided to ignore. It is what it is, but it provides some precedent.
Stockey Centre: Operating losses are on the order of $300,000 per year. This does not include the amortized cost of the recent improvements to the roof and the siding that amounted to about $1.2 million.
Bobby Orr Community Centre: The annual losses on this facility are on the order of $400,000 per year. This also doesn’t include the facility upgrades that included replacing the ice surface and the supporting infrastructure. The cost for this upgrade is about $1 million plus and is being amortized.
(Note: the million dollar plus cost for the Stockey Centre and Bobby Orr Community Centre type upgrades need to be budgeted for any pool complex. The figures for replacement activities are likely to be much more costly. Warm chlorinated water has a very detrimental impact on structures in this part of the world. Elliot Lake is facing this type of an issue after a couple decades of operation. In some cases it is cheaper to demolish and rebuild rather than refurbish. These facilities have lifetimes in the very low decades.)
Q3 – How much does the town spend yearly on the library? It seems to me it is always being asked to pare its (bare minimum) budget.
Answer: The 2019 Town of Parry Sound budget for the Library is $184,000. The Library has largely been well supported by Town of Parry Sound Council in terms of budget. A couple other municipalities also contribute to the Library but not nearly to the same extent as the Town.
Q4 – How willing have the townships been to contribute to joint use facilities? Many backed out of the library rather than pay their percentage of the costs. As for the arena, not only the townships but the hockey club screamed bloody murder when fair costs were allocated – & the town backed down. Does the museum still receive support from the townships? etc, etc…………!!!!!
Answer: Concerning the Museum, the area municipalities and even the Town have largely reneged on their commitment to the Museum. Originally conceived as a joint venture by the area municipalities to record and share the area’s history, the partners have tried to limit or shirk their responsibilities. The municipalities have not increased their contributions sufficiently over the past two decades to cover cost of living type inflationary expenses. In the case of McKellar they no longer support the Museum claiming that they have their own museum. That’s a bit like a deadbeat dad refusing to pay child support because they have a new family. The museum has only been able to survive because of upper level government grants and the Trillium folks who have supported needed capital improvements. The Museum is a building and buildings slowly deteriorate over the years. Somehow the municipalities feel that the Museum should be self-supporting. That is not the case for the Museum on Tower Hill, ROM, the New York Metropolitan Museum of Art or the Louvre.
The Museum is my best example of the area municipalities commitment to working together, intent and action. It doesn’t bode well for any Pool collaboration. There are no other good examples of the municipalities contributing to a shared resource over a period of years and decades. Seguin tosses the Town of Parry Sound about $10,000 per year for the Stockey Centre but that is literally pennies on the dollar in terms of the operating expense losses. The Municipal Airport might be an example, but it really only involves Seguin and the Town of Parry Sound.
A Wellness Centre and Pool can become a reality if all parties participate appropriate to the needs and resources of their community over the long term. If “good fences make good neighbors”, then good legal agreements make good partnerships. Buyer beware!