Community services face funding crunch

Debate's focus: Cut city programs or increase costs

Losses `difficult to justify'

Income leveling off, but closing facilities `is a real hot potato'

February 06, 2000|By Erika Niedowski | Erika Niedowski,SUN STAFF

Faced with rising costs and $9 million in losses from programs and facilities over the past five years, Columbia's city council is beginning to consider closing some of the amenities the planned community is best known for.

Only about five of the Columbia Association's dozens of programs make a profit, a situation that has been widely accepted for more than 30 years, in large part because the association considers itself a service organization rather than a business.

But as Columbia's room for expansion dwindles and its income from the association's "assessment" -- the city's equivalent of a property tax -- levels off, some community officials are wondering whether there's a better approach.

Cecilia Januszkiewicz, the Columbia Council representative from Long Reach and chairwoman of the budget committee, said it has become increasingly hard for CA to be "all things to all people." "I don't think that we can continue to do that," she said. "That's what budgeting is. It's all choices."

"Maybe it's time to close some programs," said Vince Marando, the council representative from Wilde Lake. "I think we have to start to confront that."

Calling it "difficult to justify" continued losses at some facilities, Wilde Lake Village Board Chairman Joshua Feldmesser has suggested privatization as one option.

"If these facilities cannot be maintained in a fashion that actually makes money that can be turned around and used to help the community, then something drastic needs to be done," he wrote to the council on CA's proposed $48.9 million spending package. "There are plenty of people out there who would be willing to pay CA to run these facilities, and they will find a way to turn a profit."

Horse Center, golf course

One facility up for review is the Columbia Horse Center, which is used by fewer than 1 percent of the city's 87,000 residents. It has lost nearly $400,000 in the past three years, and an estimated $1.5 million since 1986.

Another is the Fairway Hills Golf Club, which has lost more than $2.2 million since opening five years ago. The council's Financial Management Committee has asked for a presentation on the financial performance of that course -- as well as of Columbia's other golf facility, Hobbit's Glen -- as compared with original projections.

Earl Jones, the Oakland Mills council representative, said he has reservations about making a $106,700 capital investment in the Fairway Hills course, as has been requested by CA staff, before the bottom line improves.

The council has decided to close the CA nursery school, where enrollment has been decreasing, at the end of the school year. Council members said the need for such a program can be met by other Columbia providers.

Some council members also worry about programs that historically have made money but are showing losses. CA's before- and after-school program, for instance, turned a profit of $201,000 four years ago; next fiscal year, it is expected to lose $114,000.

Facilities over budget

The new Columbia Gym in River Hill is expected to end the fiscal year $400,000 over budget, even though it has brought in considerably more income than projected, said Rob Goldman, CA's vice president for sport and fitness. The SportsPark in Harper's Choice is expected to finish $145,000 over budget. The sport and fitness division is on track to end the year nearly $300,000 over budget -- the first time in 10 years that it has failed to at least break even.

Overall, CA officials maintain, the association's standing is solid.

"I am very pleased to report to you that the financial state of the Columbia Association is strong," CA President Deborah O. McCarty told members of the Columbia Business Exchange last month.

Because of what McCarty called the council's "internal fiscal discipline," the homeowners group retired its $28 million deficit last year and has a spendable surplus. Its proposed operating budget for the next fiscal year shows a $1.4 million net.

But that net has been shrinking for the past four years. At the same time, revenue from CA's "tax" on homeowners and businesses is reaching a plateau. CA gets about 45 percent of its income from the assessment.

Unpopular options

The situation is likely to set off a debate over several potentially unpopular options: other program closures; an increase in membership fees; and an increase in the assessment rate, which is 73 cents per $100 of assessed value.

During a recent discussion about the difference between resident and nonresident facility membership rates, the subject of closing some underused pools came up.

"Closing pools, even if nobody goes to them, is a real hot potato," McCarty said.

The $9 million in program and facility losses over five years does not include such things as citywide grants, community association grants and Architectural Resource Committee funding. When those are factored in, the total losses in the sport and fitness division and community services jump to more than $25.8 million.

Association officials justify the red ink by saying CA is not -- and was never intended to be -- a business. Rather, it was created to provide services for residents.

In budget testimony before the council, Andy Stack, chairman of the Owen Brown Village Board, raised concerns about the flattening of CA revenue and the growth in expenses.

"This trend cannot continue if CA is to remain a viable organization," he said. "The council needs to pay close attention to CA's fiscal health for the next five years."

Jones said the so-called continuation budget for fiscal year 2001, which essentially holds the line on spending, contains no money for hiring or initiatives -- save for a $100,000 set-aside for county schools that was tabled Thursday.

"I think that's a prescription for big problems," he said. "You can't stand pat in a dynamic environment."

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