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Council presses staff on community center fund, golf contractor revenues and credit card fees
Summary
Council members questioned allocations and capital needs in the Community Center Fund, where staff proposed nearly $4.0 million in sales tax inflow and increased spending for golf operations; members asked staff to study credit card fee mitigation and use of impact fees for park projects.
The Oro Valley Town Council devoted a portion of its May 5 budget study session to Parks and Recreation finances, probing how the Community Center Fund and golf operations are budgeted and asking staff to study merchant fees and possible alternatives.
CFO Dave Gephart said the community center half'cent sales tax is budgeted to bring in about $3.97 million next year; staff described an increase in community center operations mostly driven by water and utility cost increases, higher credit card fees and a change in capitalization thresholds that moves some items from capital to operations. Gephart said parks and recreation is not proposing new programs next year but is absorbing cost pressures largely outside town control.
Golf operations: The town's golf contractor, Indigo, submitted a budget showing a roughly $385,000 increase in costs (about 7%) primarily from higher water utility costs and credit card transaction fees; Indigo'proposed revenue increases of about $384,503 so the contractor's budgeted revenue increase offsets the expense. Council asked about how golf fees are set; staff said Indigo historically uses conservative revenue estimates and the town and contractor have worked to align revenues more realistically in the current recommendation. Council members pressed for better alignment of revenues with capital needs, noting ongoing capital costs at golf facilities.
Community Center Fund and impact fees: Vice Mayor Barrett and other council members expressed concern that the Community Center Fund balance (driven by the dedicated half'cent sales tax) has grown substantially and requested a broader review of how those funds should be used across parks and recreation. Staff confirmed the town will analyze options in the upcoming fiscal year as part of strategic planning and could bring choices to council earlier in the year for potential implementation in future budgets.
Credit card fees and merchant services: Council discussed rising merchant fees as a material budget driver and asked staff to study options including merchant services negotiations, passing fees to some users, or targeted policies for specific funds. Gephert said staff will analyze townwide merchant services and report back, and Council Member Murphy and Vice Mayor Barrett supported starting with Parks and Recreation as a pilot.
Council direction and next steps: Council asked staff to return with a detailed breakdown of community center fund sources and uses, historical chamber and cultural partner allocations, and options for addressing credit card fees and golf capital needs during the tentative budget process.
