Town CFO: Community Center fund steady at midyear despite flat sales-tax; golf and memberships driving revenue

Dave Gephart, the town of Oro Valleychief financial officer, told the Parks and Recreation Advisory Board on Feb. 18 that the Community Center Fund was broadly in a healthy position at midyear despite local sales-tax receipts running below the original budget.

"We're seeing townwide that our local sales taxes are really flat," Gephart said, and the town reduced its sales-tax revenue forecast by about $20,000 from the adopted budget. He said the fund's year-end estimate has nonetheless improved overall because contracted operating revenues (including the town's golf contractor, Indigo) and membership dues are outperforming prior-year levels.

Gephart highlighted three revenue themes: local sales-tax collections were at roughly 47% of budgeted expectations through December; contracted operating revenue and golf operations are outperforming the prior year; and town operating revenue is seasonal, with the expectation that the second half of the fiscal year will bring the typical revenue bump.

On membership and program revenue, Gephart said member dues are materially higher than at the same point last year. He said golf rounds are up year over year and that golf continues to be "operationally solid," crediting Indigo's management for improved rounds and revenue.

Gephart presented the fund's net position: the fund showed a smaller midyear deficit than the prior fiscal year and the year-end forecast moved from a budgeted deficit to a projected positive change in fund balance. "Our year-end estimate we are actually expecting a positive improvement to fund balance of $559,000," he said, compared with a budgeted negative $297,000.

Board members pressed on composition and timing of revenues. Gephart said certain HOA and golf-related billings typically occur late winter or early spring; he noted the town times some invoice cycles (for example, golf HOA collections) to March.

Capital work and one-time expenditures were discussed in detail. Gephart listed several projects and year-to-date spending: community center flat-roof repairs (about $112,000), a Pusch Ridge golf-bridge replacement (about $372,000 spent year to date against a roughly $400,000 budget), and a John Deere tractor purchase (about $125,000). He said the Pusch Ridge bridge replacement was treated as a safety-driven capital repair and that the town followed its engineer's guidance on the scope and procurement.

A board member asked about the half-cent sales-tax accounting: Gephart explained that council broadened the eligible uses for that half-cent sales tax beyond the original, more limited uses, and as a result certain Vistoso Trails Nature Preserve projects were temporarily charged to the Community Center Fund. He said staff may move those project costs into the capital fund and use a transfer to preserve budget clarity.

Board members also asked about the bond schedule supporting transfers out of the fund; Gephart said the bonds were issued in 2022 and would continue to require annual transfers for roughly the next 17years, a major component of the fund's transfers out line.

The presentation closed with the CFO reiterating that the town expects stronger results in the fiscal year's second half and that, on a net basis, the Community Center Fund was in sound condition.