PRK-3.06 - Reducing Cost as a Barrier to Provide Equitable Programs and Services - Cost Recovery Policy for City Parks and Recreation

Definitions

“Cost of Service” is the total accounting expenditures associated with a program or service and includes both direct (program-specific such as materials and supplies, equipment, personnel) and indirect (comprehensive, including administrative overhead) costs.

“Cost Recovery” is the recouping of some or all of the costs associated with the provision of a program or service, generally through fees and charges.

“Healthy Parks, Healthy Portland” is a planning framework of systems and tools that link PP&R’s strategy and investments to outcomes in the community.

“Standard Operating Procedures” are program and Division-specific documents that outline a clear and easy to understand action plan required to carry out or implement a policy or rule. Procedures should identify specific actions, explain when to take actions, describe alternatives, and show emergency procedures.

“2020 Parks Local Option Levy” (Parks Levy) is a five-year property tax starting in Fiscal Year 2021/2022. The Parks Levy listed fifteen voter commitments in the November 2020 Voter Pamphlet of how funds will be used to support parks and recreation services.

Introduction

Portland Parks & Recreation’s (PP&R) mission is to provide equitable access to welcoming places, programs, and services that improve community health and our environment. When organizing opportunities for the public, PP&R offers programs and services that promote learning, play and discovery; mental, physical and emotional wellness; community and civic connection; and healthy ecosystems and climate resilience. Portlanders have made a significant investment in parks and recreation so that all community members can have access to a broad range of positive activities and services.

PP&R works to acknowledge and abolish the harms of racism and oppression in our parks and recreation system by centering people most impacted by inequities. Furthermore, broad participation in public programs by a diversity of people from all segments of Portland increases both personal and public benefits. As such, PP&R’s Healthy Parks, Healthy Portland framework is centering the voices and needs of underserved communities, including Black people, Indigenous people, people of color, immigrants and refugees, LGBT2SQIA+ people, youth, older adults, people with disabilities, and people living with low incomes.

In providing programs and services, PP&R is supported by taxpayer support, grants, donations, participation fees, permitting and regulation fees, and other sources. The annual City budget determines the amount of taxpayer support that is available for PP&R services and programs. Charging fees for PP&R programs and services is a way to balance public and private benefit of the services and to increase the availability of programs and services by supplementing PP&R resources with additional revenue to pay for program and service costs. For tree permits and inspections, charging fees is required by Title 11 and supports the preservation and expansion of the urban forest.

However, charging program fees can be a barrier to accessing services and programs. A 2017 PP&R Community Needs Survey found that cost was a barrier to program access for 22% of respondents, and that barrier was even larger for people of color (25%) and people living in East Portland (28%).

Given the community benefits of PP&R services and programs, the public interest is furthered in ensuring access for groups experiencing barriers to participation. In response to cost being a barrier to participation, the 2020 Parks Local Option Levy committed, in part, to removing financial barriers for low-income households and allowing an equity-focused delivery of community events and programs. Parks Levy resources allow PP&R to focus on delivering programs and services without needing high-cost recovery to provide services.

The purpose of this policy is to guide the development of program-specific standard operating procedures that establish cost recovery practices for park and recreation programs that align with PP&R’s strategic framework and values.

Policy Statement

In alignment with PP&R’s Healthy Parks, Healthy Portland framework, PP&R will prioritize free programming, fee waivers, and reducing cost as a barrier for underserved communities, including Black people, Indigenous people, people of color, immigrants and refugees, LGBT2SQIA+ people, youth, older adults, people with disabilities, and people living with low incomes. Per this policy, planning and implementation of cost recovery practices will center underserved communities.

This policy is relevant to all PP&R programs and services – for example, recreation programs and access, community center and park space rentals, Urban Forestry permits and inspection services, and environmental education and nature programming – unless expressly excluded by the Director. System Development Charges and Non-Parks Use Permits do not fall within the scope of this policy, as they are covered under separate City of Portland policies. PP&R enterprise operations, such as Golf and Portland International Raceway, do not receive General Fund tax support and as a result will have unique standard operating procedures to recover 100% of their costs, including major maintenance and replacement costs. For equity or other business reasons they may discount certain services and programs while still achieving overall 100% cost recovery.

1. Public interest. The public has made a significant investment in PP&R and, therefore, has an interest in the availability of a broad range of PP&R services and programs that encourage mental, emotional, and physical wellness; community and civic connection; healthy ecosystems and climate change resilience; equitable tree canopy; and learning, play, and discovery. Furthermore, all Portland community members benefit when the community has park and recreation services and programs that are accessible to all.

2. Balance of benefits. Benefits of park and recreation services accrue to both the participant and to the public and, therefore, it is appropriate that programs be funded by a balance of participant fees and public resources.

3. Cost recovery. PP&R follows City Policy FIN 2.06 and recovers costs through fees and charges, with the remainder being supplemented and supported by tax revenue, grants, and donations supporting the public interest; if net revenue is generated, that revenue can support other PP&R programming. Free programming and services do not recover costs and are fully supported by tax revenue, grants, and donations. Free programming, fee waivers, and financial assistance result in lower cost recovery but encourage participation by reducing or eliminating cost as a barrier. Cost recovery goals will indicate if and how much of program expenses are covered by fee revenue and how (i.e., the levels, categories, or groups) to which those goals are applied.

4. Cost as a barrier and financial assistance. The public interest lies, among other things, in encouraging participation and reducing barriers to access of public park and recreation services. PP&R will seek to ensure affordability of programs, activities, and services through discounted fees, free activities, fee waivers, community grants, and cultivation of volunteers and partnerships.
   1. Free programming: Programs and services that are provided with no fees eliminate cost as a barrier to participation. PP&R should prioritize centering underserved communities when planning free programming, in alignment with Healthy Parks, Healthy Portland goals.
   2. Fee waivers and discounted fees: Waiving or reducing fees and charges for PP&R programs and services for underserved communities is in the public interest to reduce barriers to participation or optimize utilization and revenue generation of existing facilities.
   3. Discount levels, applicable qualifying factors for eligibility, processes by which fee waivers and discounted fees will be applied, including the internal and external processes related to discount application, will be outlined in standard operating procedures.

5. Budget balancing. Pricing of programs and services, free services, and fee waivers will be accounted for during PP&R’s budgeting process. PP&R will estimate program revenues, including assumptions regarding the impact of waiving fees and charges. These assumptions will be updated throughout the year and appropriate budget adjustments made during budget development and budget adjustment processes. Standard operating procedures will ensure that cost recovery goals are in alignment with the necessity of balancing the overall bureau budget.

6. Standard operating procedures for cost recovery. Program standard operating procedures will provide clear and understandable plans of action required to carry out and implement the priorities in this policy. Program specific cost recovery goals, rates, and cost of service will be set and determined through PP&R Director-approved standard operating procedures.
   1. Development of standard operating procedures –
      1. Using the Healthy Parks, Healthy Portland ongoing cycle of Listening and Learning and other community engagement processes, PP&R will identify programs and services that are high value and priority for underserved communities. The identification of these high priority programs and services should be considered when setting cost recovery goals.
      2. Standard operating procedures will be developed by program staff and Division leadership, in partnership with the bureau financial analysts.
      3. Consistency with other City bureaus’ cost recovery approaches, particularly for development and regulatory fees, should be considered and incorporated.
      4. Cost of service – In developing cost recovery targets, the cost of service for each program, or program type should be determined and reviewed as needed.
         1. In alignment with City Policy FIN 2.06, PP&R will complete a fee study based on cost-of-service principles. Among other things, the study will include fee structure and corresponding cost recovery, the degree of general benefit versus private benefit, and equity implications or impacts.
         2. Divisions should work with their financial analyst to consider information from the fee study, such as comparable market rates, in setting cost recovery rates.
      5. Consultation with the Office of the City Attorney should be part of the drafting and review process. Additional internal PP&R review will occur to ensure consistency between program standard operating procedures. The final standard operating procedure will be approved by the PP&R Director. All standard operating procedures will be filed, reviewed, and updated as needed.
   2. Program and services prices are to be set by program staff, in partnership with the PP&R finance team, under the authority of the PP&R Director per City Code Chapter 20.08. One exception to this authority is Urban Forestry fees, which are approved by City Council per Title 11. In setting prices, PP&R will balance the goals of program availability and affordability within the constraints of budget allocations, market economics, and cost recovery goals approved in standard operating procedures.
   3. Program standard operating procedures should consider incorporating the following information (among other things):
      1. Cost recovery rates and how rates will be implemented, including defining what programs and services will have no, partial, direct, or full cost recovery.
      2. Timelines for when programs and rates are re-evaluated.
      3. How discounted fees, free activities, fee waivers, community grants, and cultivation of volunteers and partnerships will be used and balanced.
      4. Processes by which underserved communities may receive discounts or reduced fees or costs.