User fees at Servus Credit Union Place will increase by 4.35 per cent next October, making its fees one of the highest at comparable facilities.
Sitting as committee of the whole, councillors unanimously approved a motion by Coun. Malcolm Parker to increase all user fees at Servus Place. Parker decided to submit his own increases after administration revealed the proposed rates contained in the operating budget were the same as 2011.
Per council policy, rates for Servus Place aren't set until administration first reviews fees at comparable facilities, such as Millennium Place and the Transalta Tri Leisure Centre. That market analysis takes place in the spring. As a result, rate changes at Servus don't take effect until the following October. As those rates would only reflect one quarter of revenue in the budget, administration has typically left the previous year's rates in place.
“It's always been a bit of an oddity because we know there will be some type of adjustment come October so leaving it sort of unaddressed at budget time, it's just a timing factor,” said acting city manager Chris Jardine. “If we did the analysis now, we're doing it based on old numbers and we're trying to get the most accurate numbers possible.”
Jardine called the changes “a little bit premature” based on the policy adopted by council.
“But it's council's policy and so they can deviate as they feel is necessary.”
Under Parker's proposed changes, fees will increase 4.35 per cent on average instead of the three per cent administration was privately expecting. The changes will take affect next Oct. 1, 2012.
But neither Parker nor Jardine think the size of the percentage matters as much as the actual dollar amount.
“Percentages can be a distraction … that's not the right word,” Parker said. “Look at the absolute number for a lengthy period instead.”
He cited the example of how, under his proposed changes, an annual membership for a family will increase 3.3 per cent to $1,239, an increase of $36. The largest increase at 5.8 per cent for a day pass for a child, equates to 25 cents.
“I think that's reasonable,” Parker said.
Those increased fees will add $25,000 to Servus Place's bottom line, which Parker feels is beneficial for the city-run leisure centre, which operates from a deficit position.
“I guess if you're realistic about it, if you're faced with increased costs, you have to recover those, especially when you have an enterprise that's losing money,” Parker said. “Either way there were going to be increases. They are nominal and reasonable and I don't think anyone's going to stop going to Servus Place because of them.”
When asked, Parker admitted he did not compare rates with other facilities before submitting his proposed increases.
Adults at Servus Place purchasing a day pass will pay $10, compared to $8.75 at the Tri Leisure Centre and $8 at Millennium Place. A monthly adult pass at Servus Place will cost $49 compared to $39 at Millennium Place and $59 at the Tri Leisure.
Facility director Diane Enger spoke at Tuesday's meeting, warning councillors Servus' fees were already rising ahead of its competitors.
“We feel that based on our current increases, that we are getting close to what the market will bear,” Enger told council. “It's important for us to look at this in March to see what the market will be doing. We are over Millennium Place. We are right at the top of the market.”
In a later interview, Enger said Servus will continue to monitor rates at other facilities, but that Parker's increase “is not out of line.”
Jardine also said the city would still perform its market analysis in the spring, but said administration would only recommend changes if higher fees were warranted.
“It's going to be what it's going to be,” he said.
