May 10 2011

Taxpayers Will Provide 50% Subsidy of Pool Under Proposed Pool Fee Structure

Recently released pool use proposals and budget numbers hold a number of surprises for Piedmont taxpayers and swimmers:  Piedmont taxpayers will begin providing a 50% subsidy of pool operating costs starting July 1st.

  • Piedmont taxpayers will pay pool costs of $380,000 while the City hopes swimmers will generate $377,000 in fees, to cover a total estimated pool budget of $757,000.
  • An additional $108,000 in transition costs will be paid in FY 2010-11
  • An additional $600,000 in proposed capital improvement funds  (CIP staff report)
  • The currently proposed fee structure offers daily swimming privileges to residents and non-residents at the same low rate.

The annual estimated $380,000 taxpayer subsidy exceeds the City’s prior estimate of this amount:  $127,000 to $327,000 per its Aquatic Study in 2006. The City’s operating costs of $757,000 are higher than the most recent financial information from the Piedmont Swim Club:  $650,000 per year.  The CIP staff report includes an additional $600,000 in capital improvements for the pool.

Costs previously fully borne by the Piedmont Swim Club have been shifted onto taxpayers.  Low-cost daily rates will potentially generate high usage at taxpayer subsidized rates.  The currently proposed fee structure relies on taxpayers to fund 50% of operating costs and 100% of capital improvement costs.

The Commission will consider the usage and fee structure further on May 18, when the public is invited to address the issues. See video of May 4, 2011 meeting.

Further Background on Pools:

A public city pool is a different business model than a private club. User fees for a public pool typically only cover 60% of the cost of operation for seasonal (warm weather) pools, while year-round outdoor pools average only 40% of costs paid by user fees according to the City’s 2006 Aquatics Study by the Sports Management Group.  Consequently, Piedmont taxpayers will subsidize approximately 50% of the use by all swimmers including those from surrounding communities.

In an effort to recover pool expenses, the Recreation Department goal is to encourage greater use of the facilities. At the Recreation Commission meeting on May 4, a staff proposal for 14 categories of daily swim fees and 26 membership categories was considered in formulating a final recommendation to the City Council.  (See aquatic budget 2011-12.)  The Commissioners expressed concern that the fee structure needed adjustments to assure quality swimming, appropriate fees, and control over excessive demand.

Five years ago, a proposed a 35,000 square foot fitness club, tournament pool, and underground parking garage on City land was proposed as a redevelopment project for the area around and including the pools.  No fund-raising for that project has been announced, and financing by the City is currently not available.  Soliciting new bids to compete with the Swim Club for the lease of the property per City requirements was constrained by the short transition time period of going from private to public management.








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