Wicomico Agency Presents Enterprise Business Plan
SALISBURY – The Wicomico County Council was presented with good news and bad news this week when it comes to the Recreation, Parks and Tourism Department, but analysis shows in the end the final revenue figure in 2013 will continue to be on the rise.
This week the Wicomico County Council was presented with the Department of Recreation, Parks and Tourism’s 2013 Enterprise Business Plan.
Recreation, Parks and Tourism Director Gary Mackes explained 32 years ago the county charged the department to establish an enterprise account that would have self-sustaining services and activities, instead of being operated by a traditional budget that consisted of defined appropriations of expenses and anticipated revenue.
“The fund requires no tax subsidy and offers flexibility to render services as demand dictates,” he said. “I don’t know where Wicomico County would be without this tool, especially in light of the local economy and the challenges you all [council] face in operating this government.”
Mackes pointed out, for the number of assets and services provided in Wicomico County, the county has the least Recreation and Parks’ tax appropriation per citizen out of eight Eastern Shore counties in Maryland. The average tax appropriation of those counties is $23 per citizen. In Wicomico, it is set at $14.50.
According to the department’s website, currently the County Parks Division operates 38 facilities encompassing over 1,400 acres of land, while the Recreation Division runs numerous programs with enrollment totaling 8,400. The facilities, currently valued at over $32 million, were built at a cost of approximately $3 million in local money. They include 32 ball fields, 34 tennis courts, 18 basketball courts, 20 playgrounds, 17 pavilions, eight boat ramps and 212 boat slips.
“A lot of this has to be attributed to this enterprise fund because when you add in all we are doing we would get up pretty close to the Eastern Shore average,” Mackes said.
Mackes added that 60 percent of the county’s tourism is contributed to amateur sports and signature events that are held at athletic complexes operated through the enterprise account.
“If we had to close those sites, Wicomico County’s local economy would lose about $20 million a year,” he said. “So the business plan you are looking at is a very important tool in getting these benefits without any tax subsidy.”
The Enterprise Business Plan is a working document that includes over 100 different businesses. The plan runs on a calendar, from Jan. 1 of each year to the end of December, versus being based on government’s traditional fiscal years, which come to a close at the end of June.
“Obviously like any business it is hard to project the demand … and not being able to anticipate how many people are going to rent boat slips or come to tournaments or buy hot dogs at concession stands, obviously how that fluctuates affects your expenses, which requires on our part a tax flow analysis, future trending and constantly a recalibration of this document,” Mackes said.
The process begins in September when staff start to analyze trends and develop what that they think was the cost to operate each of the businesses. Next, in October the analysis is presented to all the stakeholders and their feedback is received.
Following the meetings with the stakeholders, the proposed fees for the upcoming year are recalibrated and presented to the Recreation and Parks Commission. From there it moves forward to the Executives Office where it was approved and then to the County Council for final approval.
“This fund is finally rebounding, a $144,000 increase from what our budget was when it was cut by about 40 percent back in 2011,” Mackes said. “We are finally starting to get there.”
However, the department is uncertain over the trends that are developing. For example, boat slip leases are on the decline as the economy remains to struggle.
“Yet we still have the same fixed cost, profit margins aren’t the same, and you are going to see in next year’s operating budget there will be a reduction in the amount of revenue that will offset our cost because our business volume just isn’t there,” Mackes said. “We are still solid but we are not where we were before the recession.”
Mackes added the Westside Community Center is a facility suffering in this economy as residents are finding it harder to afford after-school child care and other programs.
In summary, from 1981 the department’s revenue increased by thousands of dollars each year until the figure dropped from $1,254,678 in 2008 to $1,092,156 in 2009. In 2010, the revenue was back on the rise to $1,238,700, but declined in 2011 to $1,190,553. The estimated revenue by the end of 2012 is $1, 171,904 and in 2013 it is $1,412,915.
The council voted unanimously to approve the Recreation, Parks and Tourism 2013 Enterprise Business Plan.