Boulder Parks and Recreation Fee Policy

The purpose of the fee policy is to establish clear and consistent guidance for how fees are set and subsidies are awarded. In establishing a fee policy, BPR intends to create a standard approach for all fees collected, develop transparent fee categories and definitions of the types of access or programs which are subject to various fees, and create clear cost recovery targets. The Fee Policy should be applied to all programs to promote access for community members who are historically excluded and that have been prioritized by the community. This will ensure that limited subsidies are focused where they can have the most community benefit, with an understanding that additional support may be provided based on additional funding as called for in the 2022 Parks and Recreation Plan. In determining the subsidy levels, BPR will provide subsidies based on the level of funding available and the level of community benefit each program provides.

The City of Boulder Parks and Recreation Department promotes the health and well-being of the entire Boulder community by collaboratively providing high quality parks, facilities and programs. BPR operates from five primary funds. These funds are the Recreational Activity Fund (RAF), .25 Cent Sales Tax Fund (.25ST), General Fund, Permanent Park and Recreation Fund, and Lottery Fund.

Recreation Activity Fund: A special revenue/quasi-enterprise fund that is specific to the Parks and Recreation Department. The fund is the primary funding mechanism used to support recreation centers and facilities and subsidize fees for services related to the provision of recreation, reservoir and golf course services/programs that do not cover all their direct costs. This fund is supported through user and participation fees, grants and donations, and an annual subsidy transfer from the General Fund.

.25 Cent Sales Tax Fund: A special revenue fund that is specific to the Parks and Recreation Department. The fund is primarily supported through a designated sales tax that was approved by voters in 1995. In 2013 voters renewed the sales tax through 2035, with 85% of votes supporting the tax. The fund supports multiple aspects of the department, including operations and maintenance, administrative support services, renovation and refurbishment, and capital improvements.

General Fund: The city’s largest fund that serves as the primary funding source for most governmental services. BPR uses its portion for park operations, forestry and department administration. The general fund is mostly supported through a blend of taxes, permits, fees, and intergovernmental transfers. As a result of the fund’s heavy reliance on tax revenue and pressure from other departments, the fund’s revenues, and ability to contribute to the department’s budget can fluctuate, although it has been relatively stable over the years.

Permanent Park and Recreation Fund: A fund specific to the Parks and Recreation Department, this source of funding is permanent according to the City of Boulder’s charter and is supported through earmarked property taxes, with the Parks and Recreation Department receiving $0.01 for every dollar of property tax collected by Boulder County. These funds are limited to the acquisition or permanent improvement of parkland, renovations, and refurbishment of recreation facilities, and is a source of funds for capital improvements.

Lottery Fund: A special revenue fund that accounts for State Conversation Trust proceeds that are distributed to municipalities on a per capita basis. Money from the Lottery Fund must be used only for the acquisition, development, and maintenance of new conservation sites or for capital improvements or maintenance for recreational purposes on any public site.

Residency

• Resident: any individual who lives at an address located within the City of Boulder service area.
• Non-Resident: any individual who lives outside of the City of Boulder.
• Resident/Worker: individuals who live or work in the City of Boulder are eligible for Resident/Worker rates for facility entry. Resident or non-resident status applies for all other types of programs.

Age Based Fee Groupings

• Youth: participants between 3 and 18 years old.
• Adult: participants between 19 and 59 years old.
• Senior: participants who are over the age of 60.
• Household: any adults, seniors or youth residing at the same address. Proof of address is required and no more than 8 members aged 19 or older.

Costing Definitions

• Cost Recovery: the collection of revenue to pay for the direct and/or indirect costs of providing a service or program. The level of cost recovery will vary based upon the service, type of program, program category benefit level, targeted skill level, market
  costs and other factors.
• Direct Costs: The costs directly related or attributed to providing a specific service. Direct costs include staff time, materials and supplies directly related to providing the service.
• Indirect Costs: Costs incurred across the department that are not directly attributed to a specific service but benefits the department as a whole. Indirect costs typically include marketing expenses, software, utilities, space allocation, and management staff that support a variety of services or programs.
• Market Analysis: A point-in-time analysis or survey of prices charged by other agencies, public and private for a similar service. Market Analysis is typically limited to benchmark communities, local private business and non-profit organizations.
• Subsidy: Funding provided by the city to offset the costs of a service to support a higher level of community benefit. Based upon community input, subsidies are typically awarded to programs that support low-income residents, people with disabilities, older
  adults and youth.
• Discounts: Discounts may be provided associated with marketing and/or volume-based discounting to provide benefits to participants who are regularly using a service or program.

Program Benefit Categories

• Community: Services that enhance the health, safety and livability of the community and therefore require minimal obstacles to participation.
• Recreation: Services that benefit a broad range of users and are targeted to promote physical and mental well-being.
• Individual: Services targeted to specific individuals or user groups with limited community benefit.

The Department of Parks and Recreation’s Fee Policy represents a standardized approach to program categorization and definitions, while aligning a clear subsidy level based on the level of community benefit provided. Fees are an efficient and equitable way to distribute the costs associated with providing services that exceed the ability of the tax base to support the costs. This comprehensive policy will promote community understanding with clear fee practices and financial sustainability. This Fee Policy was developed through the documentation of previous policy guidance from the Parks and Recreation Advisory Board, includes guidance received from the 2022 Parks and Recreation Plan, along with significant input from the Parks and Recreation Advisory Board, Community Connectors in Residence and City Council. This Fee Policy identifies and informs the program types and a consistent method to assign services to those types and includes the appropriate benefit level of subsidy and cost recovery target that should be achieved. Tax subsidy provided each year from the General Fund and/or other sources such as .25 Cent Sales Tax Fund should be allocated in a way that supports the cost recovery targets based on available funding, which then directs the corresponding pricing strategy each year.

The concept of cost recovery involves setting fees based on the total cost of providing the service and factors in the program category benefit level so that the total funding received (Taxes and User Fees) equals the total cost of providing a particular service. This is critical to the financial sustainability of public parks and recreation.

The department will review fees and charges for all programs and services along with cost recovery performance at least every two years as part of the annual citywide budget development process. Once the cost to provide services is analyzed, each service area will review cost recovery performance compared to stated goals within the Fee Policy. Total cost of service as well as the department’s Service Delivery Model, market analysis, and feedback from staff and participants, will inform any recommendations to the Department Director to update fees. The Department’s pricing strategy is based on several considerations:

• Level of Community Benefit
• Supply and Demand
• Market Comparisons
• Residency/Non-residency priority
• Age-based prioritization with an emphasis on youth and seniors
• Accessibility and health promotion
• Value of Program (availability of alternative providers, quality of program)
• Cost recovery philosophy
• Availability of subsidy to support age-based discount, community benefit recreation and financial aid.

Each activity will be sorted into a program type. Each program type will have a minimum cost recovery rate and a target cost recovery rate. Programs that are being introduced will likely be at the minimum cost recovery rate; over the lifecycle of the program, the goal will be to achieve
the target cost recovery rate.

While setting rates, staff must evaluate market rates and demand for the activity to determine price sensitivity for any proposed price adjustments. If the price is too high and/or there is little demand for the program, staff must consider the feasibility of reducing costs, reducing fees or propose the elimination of the program. To minimize impacts to participants, fee increases may be limited to 10% in a year for any community or recreation level programs. Fee increases may be phased in over a 2-to-3-year period to minimize impacts to participants.

When establishing fees, BPR will support fees that the market will bear, even if this exceeds the cost recovery targets. Additionally, BPR will not undercut the market as it is not a good use of subsidy and jeopardizes the overall health of the market. Programs with high demand should also evaluate fee increases to improve cost recovery. Both tactics will allow the department to reinvest in other program areas with lower cost-recovery goals, in turn allowing the department to reduce the reliance on tax subsidy and reinvest in priority programs. During future updates to the Fee Policy, BPR will adjust the cost recovery targets accordingly based on actual performance.

To ensure there is equitable access for populations the community has prioritized, the department will continue to subsidize access for low-income individuals, people with disabilities, youth and seniors. The department is committed to maintaining financial aid programs to qualifying Boulder residents, providing subsidized access to facilities and programs, as funding allows.

All fee updates will be reviewed annually by the Parks and Recreation Advisory Board and for consideration by City Council with the adoption of the operating budget each year. The City Manager shall give notice regarding changes in fees by filing a schedule of fees with the City
Clerk and displaying the changed fees on the City’s website. Increases shall not take effect until at least two weeks have passed since notice was given. Fees shall be in effect as of the effective date specified in the schedule.

Fees may be temporarily discounted or reduced through special promotional pricing as warranted. The City Manager may reduce fees from time to time as market conditions warrant, and may also raise them again, so long as the fee never exceeds that specified in the fee schedule. Below are the program types with associated category benefit level and cost recovery target goals, definitions and examples of activities. These are examples of various types: they are not all-inclusive lists and program offerings change over time.