SUPPORTS ITEM NO. 5 CS&B COMMITTEE AGENDA OCTOBER 10, 1996 ADMINISTRATIVE REPORT Date: September 26, 1996 TO: Standing Committee on City Services and Budgets FROM: General Manager of Parks and Recreation SUBJECT: 1997 Roundhouse Operating Budget RECOMMENDATION THAT Council approve a 1997 Roundhouse operating budget with a $225,900 reduction as described in this report. COUNCIL POLICY In August 1996, Council approved a $1,252,000 Roundhouse operating budget, subject to an initial reduction based on reduced operating hours. BACKGROUND On August 1, 1996, City Council approved the annual operating budget for the Roundhouse in the amount of $1,252,000, and directed "...the City Manager to meet with the General Manager of Parks and Recreation to develop an initial operating budget based on reduced hours, with a program to phase in to the full budget of $1,252,000 over a period corresponding to the full development and occupancy of the area". The following report recommends a reduced budget based on a seventy-two (72) hour base operating week for 1997, and provides a rationale. DISCUSSION The budget has been reduced in the following areas: Salaries (3 positions) $112,300 Auxiliary staff 24,700 Program contracts 14,000 Janitorial 30,000 Building maintenance 32,400 Janitorial supplies 12,500 $225,900 The Council approved annual operating budget is based on 102 hours of operation per week. In order to reduce the hours of operation as required by Council in the initial year, staff made assumptions about preferred times for programming, and recommends a base week of operation of seventy-two (72) hours: Monday: Closed Tuesday to Friday: 8:30 AM to 10:30 PM (14 hours daily, 56 hours weekly) Saturday: 8:30 AM to 5:30 PM ( 9 hours daily and weekly) Sunday: 10:30 AM to 5:30 PM ( 7 hours daily and weekly) During the first and last half-hour of operation each day the centre will be closed to the public to permit staff the time necessary to open and close the facility. During closures the gymnasium and cultural centre wings can still be made available on a cost recovery or rental basis, since these areas can be isolated from the main centre and used independently. As a result of reduced hours, savings can be obtained by a smaller regular full-time staff, which has been reduced from ten positions to seven. The positions of Operations Manager, one Recreation Facility Clerk, and one recreational clerk typist are not being filled at this time. Auxiliary staff and vacation relief have also been reduced. Maintenance costs have been reduced substantially in the first year, since the building is still new. It is important to note that the bulk of janitorial maintenance savings come from shutting the centre for one entire day (Monday), since there are only marginal differences between the maintenance require-ments of a full fourteen hour day and an eight hour one. Arts programming costs have been reduced, but have been kept at a level that reflects the intent of the Roundhouse to program actively as opposed to operating as a rental facility. It also reflects the intense interest shown thus far in the Roundhouse by a large number of arts groups, from the local neighbourhood and across the city, who will experience considerable frustra-tion if the centre cannot provide levels of support found at other public cultural facilities. The total recommended reduction in the budget is $225,900, or 18% of the total approved operating costs. Please see Appendix A for a breakdown of the budget figures. Additional savings cannot be obtained without a further significant reduction in operating hours (such as remaining closed for another full day) and in program breadth since most core operational costs -- salaries, heating and air conditioning, maintenance, utilities -- remain fixed despite minor variations in hours and programs. CONCLUSION This report has tried to balance a realistic minimum level of service with cost and operational factors for the first year of operation. Staff believe the recommended level will allow the centre, at a significantly reduced initial cost, to remain a dynamic focus as the local community expands. If the recommended budget is approved by Council, staff will report back on operating levels as part of the 1998 budget request. * * * * *