Title
RESOLUTION NO. 2014-073 OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA APPROVING AN AGREEMENT WITH PROS CONSULTING, LLC TO PREPARE A COST RECOVERY, RESOURCE ALLOCATION AND REVENUE ENHANCEMENT STUDY FOR THE CITY’S RECREATION FEES
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RECOMMENDED ACTION
Recommended Action
Council adopt the resolution.
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SUMMARY
In an effort to continually improve and enhance services and overall organizational effectiveness, the Recreation Department solicited competitive proposals from qualified firms to conduct a Cost Recovery, Resource Allocation and Revenue Enhancement Study including an analysis of pricing, operational strategies and working methodologies for the Recreation Department. The comprehensive review and analysis will assist the Recreation Department in refining its service delivery and financial management philosophy to enhance and/or sustain services over both the short and long term.
ENVIRONMENTAL REVIEW
The Development Services Director has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity is not a “Project” as defined under Section 15378 of the State of California CEQA Guidelines because the activity consists of a governmental administrative/fiscal activity that will not result in direct or indirect physical changes in the environment. Therefore, pursuant to Section 15060(c)(3) of the State of California CEQA Guidelines, the activity is not subject to CEQA. Thus, no environmental review is required.
BOARD/COMMISSION RECOMMENDATION
Not Applicable.
DISCUSSION
The comprehensive review of the City’s Master Fee Schedule currently underway identified the need for additional analysis of Recreation fees. The Citywide Cost Recovery Policy has established an overall cost recovery goal for recreation programs of 30-70% cost recovery. Updating fees and charges requires updating the City’s Master Fee Schedule and associated policies. An analysis needs to be conducted to determine current cost recovery, core services, and revenue sources. This analysis has become a key trend in the recreation and parks profession of municipal agencies in an effort to improve and enhance services and overall effectiveness of departments.
In February, the Director of Recreation received three proposals to provide a Cost Recovery, Resource Allocation and Revenue Enhancement Study. The following proposals were received: Matrix Consulting Group ($22,000), GreenPlay, LLC ($44,253) and PROS Consulting LLC ($64,570). Each proposal was evaluated by a team of City staff, which included members from both the Finance and Recreation Departments. All three contractors were invited to participate in an oral interview to review their proposals. It is the recommendation of staff to award the study to PROS Consulting LLC.
From the submittal of their proposal and through the interview process, PROS Consulting actively demonstrated to City staff their competence and understanding of the Study objectives. PROS Consulting was able to demonstrate to City staff the goals and outcomes the Study will achieve under its guidance, including:
• identifying costs of operations and organizational sustainability;
• engaging the community;
• community needs are defined based on values of the changing demographics and market factors;
• opportunities are identified to enhance and leverage the financial resources of the City of Chula Vista in providing recreation facilities and services;
• teach and train staff to think in an outcome-driven and business-minded approach;
• develop a prioritized decision-making roadmap supported by a logical resource allocation model and pricing strategies; and
• develop a dynamic and realistic action plan to recover costs and generate revenue.
Pros Consulting best demonstrated the ability to conduct effective stakeholder outreach, identify opportunities for revenue enhancement strategies, provide benchmark analysis, and education. Staff believes that PROS Consulting has the technical skills and experience needed to prepare a legally defensible cost recovery, resource allocation and revenue enhancement program.
DECISION-MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is not site specific and consequently, the 500-foot rule found in California Code of Regulations section 18704.2(a)(1), is not applicable to this decision. Staff is not independently aware, and has not been informed by any City Council member, of any other fact that may constitute a basis for a decision maker conflict of interest in this matter.
LINK TO STRATEGIC GOALS
The City’s Strategic Plan has five major goals: Operational Excellence, Economic Vitality, Healthy Community, Strong and Secure Neighborhoods and a Connected Community. The Recreation Department is excited about this opportunity for a Cost Recovery, Resource Allocation and Revenue Enhancement Study, as this Study will identify opportunities to improve and enhance services and overall organizational effectiveness (Operational Excellence), improve the financial sustainability of the Recreation Department (Economic Vitality), evaluate resources and partnership opportunities to provide diversified activities for all to promote healthy lifestyles (Healthy Community), educate the community on recreational opportunities (Strong and Secure Neighbors) and involve community engagement through meetings with community members and partners (Connected Community).
CURRENT YEAR FISCAL IMPACT
The Recreation Department has identified one-time savings in their fiscal year 2013-14 budget that can be used for the Cost Recovery, Resource Allocation, and Revenue Enhancement Study. Therefore, no appropriations are being requested at this time.
ONGOING FISCAL IMPACT
Upon completion of the Study, full costs to provide and maintain recreation facilities, programs and services will be identified. This information will support the efficient use of resources and effective cost recovery and revenue generation programs. We anticipate long term positive fiscal impacts with the implementation of the recommendations of the study. Revisions to the City’s Master Fee Schedule for recreation programs and facility rentals to effect changes in cost recovery and revenue generation will be brought to Council for consideration at the conclusion of the study.
ATTACHMENTS
Resolution
Two-Party Agreement
Contractor’s Disclosure Statement