St. Albert's largest recreation facility, Servus Credit Union Place, had a $1.6 million operating deficit last year, according to the facility's annual financial report presented to council on Tuesday.
The $1.6 million deficit marks the third straight year where the facility has posted a smaller deficit than the year before, as the facility had a $2.1 million deficit in 2022, and a $2.9 million deficit in 2021.
An administrative report accompanying the 2023 Servus Place financial summary, written by city financial controller Stanley Chan and city supervisor of analytics and business operations Susannah Wood, said Servus Place saw “record high” registration and participation in summer programming — especially swimming programs given the temporary closure of Fountain Park Pool for most of last year — which led to $380,000 in higher-than-budgeted revenue generation in 2023.
However, the report notes membership growth and programming revenue has “begun to plateau,” and the city may not see improved cost recovery in 2024.
Coun. Sheena Hughes told the Gazette she is concerned the facility could see record-high programming registration but still have a substantial operating deficit.
“Programming experienced a record-high number of summer program participants and a significant increase in aquatic programs, and yet we are still not anywhere near breaking even,” Hughes said, calling it a “frustrating” situation.
Hughes also said, similarly to the last two years, she had hoped the annual financial report would include more detailed information about the facility's operating expenditures.
“What we continue to see in Servus Place is no clarity about the finances,” she said. “This is so high level, it's from 30,000 feet at best, and yet we are subsidizing it for well over $1 million, close to $2 million a year, with no clarity on the finances to explain what's happening.”
For Coun. Ken MacKay, it's a given that city-owned and operated recreation facilities come at a cost, but the expense should be weighed against the benefits to the community.
“We always try to balance our expenses and operations because I think that's just good governance, [but] I wouldn't expect that a facility like Servus Place and all of its programs will always break even financially, because we have to weigh in the public good,” he said. “It's such a large asset for our community.”
MacKay said he didn't understand why council was singling out Servus Place from all of St. Albert's city-owned recreation facilities and parks.
“We don't ask Fountain Park to have their annual financials reported, [or] ball diamonds [or] Woodlands Water Park,” he said. “We brought in the skateboard park, we brought in the water park, we brought in the other swimming pools, we brought in disc golf [and] we don't charge for disc golf.”
“There are recreational facilities and opportunities in our community that are for the benefit of our residents, whether it's physical, emotional or just mental well-being of our residents ... and I don't think [revenue is] the only thing that we need to measure.”
In all, the $1.6 million operating deficit is $657,000 less than what administration forecast at the beginning of 2023.
Looking ahead, administration is forecasting a $1.75 million Servus Place deficit for 2024, despite another temporary closure of Fountain Park, although the city will continue to “monitor usage patterns and communicate forecast adjustments as part of the quarterly reporting process,” Chan and Wood's report says.
Council heard on Tuesday there were no specific reasons behind why the city was forecasting a higher deficit next year, such as expected drops in memberships. Rather, administration creates forecasts based on actual numbers seen in previous years.
