Date:February 10, 1999

To:Economic Development Committee

From:Joe Halstead, Commissioner, Economic Development, Culture and Tourism

Subject:Harmonization of User Fees for Recreation Programs

Purpose:

The following report with attachment summarizes the results of a community consultation process, Community Council input and provides a policy statement and a range of options for consideration in conjunction with the User Fee Committee report dated November 25th, 1998 regarding a new harmonized user fee policy for recreation programs.

Source of Funds:

Depending on the decision of Council, there is a potential budget impact ranging from a $10 million budget pressure to a $6.1 million revenue enhancement. A source of funds to recover any reduction in revenue resulting from a harmonized recreation user fee policy has not been identified.

Recommendations:

1.That the Economic Development Committee provide direction on a preferred option for a new harmonization user fee policy as outlined in this staff report;

2.That this report be forwarded to the Budget Committee with the Economic Development Committee recommendations for their consideration in the 1999 Budget Process;

3.That the Commissioner of Economic Development, Culture & Tourism be authorized to implement harmonized rates in keeping with the Council decision on this matter.

Background:

City Council, at its meeting held on June 3, 4, and 5, 1998 referred Clause 6, Report 9 of the Strategic Policies and Priorities Committee headed "Harmonization of User Fees for Recreation Programs", together with all rendered motions, to the User Fee Committee. The Committee, with support from Parks and Recreation and Clerk's Divisions, undertook a comprehensive process of evaluating policy options involving a thorough public consultation.

Comments:

The issue of user fees for Parks and Recreation programs is perhaps one of the most visible examples of variances in policy among the former municipalities. Parks and Recreation currently offers approximately 54,000 programs each year and fees range from no user fees to competitive rates based on the open market. Current fees are based on existing policies from the former municipalities. Most of the former Parks and Recreation Departments charged user fees for recreation programs although there was a wide range of prices and levels of subsidy from the municipal tax base, reflecting the values, traditions and resources unique to each community.

As in many other public policy discussions, the use of user fees to fund public recreation programs is controversial. There is strong public opinion which argues that recreation is an essential service and that fees are inappropriate and exclude access to the benefits of recreation to those members of our community who could benefit most. User fees are seen by some as a form of "double taxation" and ideologically inconsistent with a public service ethic. Assistance programs are viewed as insensitive and may have the effect of marginalizing low income groups. They argue that charging fees for community programs reduces volunteerism and community development and that the focus of programming becomes "profit" oriented to the detriment of community needs.

On the other side are a range of opinions which advocate moving away from a reliance on taxes to fund public services and express support for user fees which could enhance the quality and quantity of services above the basic level and ensure sustainability. They maintain that user fees encourage active, consistent and enthusiastic participation and registrations which more closely reflect needs. The criticism of the "no user fee" approach suggests that by subsidizing everyone - regardless of their ability to pay and treating all programs as if they were equally deserving of tax support, limit opportunities for additional programs to serve community needs. They argue that taking a more business-like approach increases government efficiency and accountability and targets scarce resources to high priority public needs, further subsidizing participation of our high needs residents.

There are clearly differing views and concerns which must be considered.

Policy Preamble

To put the User Fee Policy into context it is important to understand the Vision, Mission and Benefits of Parks and Recreation Services in the City of Toronto.

Our Vision

Toronto will be known by the world as the "City within a Park" - a rich fabric of parks, open spaces, rivers and streams that will connect our neighbourhoods, and join us with our clean, vibrant lakefront. The world will envy and seek to emulate the healthy, productive and balanced lives that the people of Toronto have achieved. Our parks and recreation services will signal to the world Toronto's commitment to the best of all possible futures.

We believe that...

Leisure services are central to our quest for the human potential, building our social foundations and a key prevention opportunity for individual and community wellness;

Individuals have intrinsic worth and are entitled to access the benefits of parks and recreation in the type and level of activity consistent with their interest and ability;

Communities have diverse values, interests and skills and that there are shared values which are the foundations of our Toronto community;

Natural environments and resources are important for present and future generations. Humans are an essential, interdependent component of the ecology;

Public leisure service priorities focus on broad community needs, "recreational" and entry level participation, children, youth and the needs of marginalized members of our community and respond to changing priorities;

Leisure services are a shared responsibility involving a partnership of community organizations;

Recreation services are an important municipal service.

Participation in Parks and Recreation programs provide many benefits to individuals and communities; thus:

Leisure opportunities and facilities are the foundations of community pride and provide opportunities for community involvement and volunteerism

Recreation helps people live longer - adding up to two years of life expectancy

Recreation prolongs independent living for seniors by compressing the disease and impairment period typically associated with aging - keeping seniors vital and involved in community life

Recreation significantly reduces the risk of coronary heart disease and stroke

Recreation combats osteoporosis - affecting 25% of postmenopausal women

Recreation combats diabetes - the fourth ranking killer disease (after heart disease, cancer and respiratory disease)

Recreation has been shown to help in preventing site specific cancers - particularly in the colon, breast and lungs

Recreation helps prevent and rehabilitate back problems - affecting 25% of adults

Recreation is essential to the development of our children and youth where they learn

motor skills (physical) through play and sports

social skills through play and sports

creativity through play and arts/cultural activity

intellectual capacities and concepts through play

Recreation builds self-esteem and positive self-image - foundations to personal quality of life

Recreation reduces self-destructive behaviour and negative social activity in youth - an antidote to smoking, substance abuse, suicide and depression

Families that play together, stay together - children and youth remain connected; couples that share leisure interests are more likely to stay together

Recreation produces leaders who serve their communities in many ways

Physical activity plays a role in rehabilitation and treatment of patients who have suffered a heart attack - studies have found a 20% reduction of risk for total mortality and a 25% reduction of risk for fatal infarction

Among young people, high levels of fitness are associated with decline in smoking and drinking behaviour, healthier eating habits and with increased self-esteem

Benefits of the provision of recreational sport opportunities for young offenders include; enhanced self-esteem, development of self-awareness, more disciplined attitude, greater awareness of health and hygiene, gains in confidence, peer group socialization and positive adult role models who care about participants

If 48% of Canadians were sufficiently physically active (moderate or vigorous level) in 1986, as opposed to the 24% of the population physically active in 1981, the annual savings to the health care system would have been about $350 million per year

There are numerous examples based on different communities that support quality of life as the main factor in locating a business - quality of life includes convenient access to natural settings; recreational and cultural opportunities and open space; greenways, rivers, trails adjacent to office sites

THEREFORE OUR MISSION IS...

To ensure that people in the diverse communities of Toronto have full and equitable access to high-calibre, locally responsive recreational programs, efficiently operated facilities, and safe, clean and beautiful parks, open spaces, ravines and forests.

Proposed User Fee Policy Statement

A proposed policy statement has been drafted based on the guiding principles adopted by the User Fee Committee.

The Department view is that a new policy should respond to the challenges -- to provide for the maximum opportunity to realize the benefits of recreation participation, social equity and choice. There is an opportunity to deliver services so that they remain relevant to all citizens of the new Toronto, especially those citizens and neighbourhoods who are most in need. The policy must include principles of social equity. A balance should be found between meeting general demands, meeting the demands and aspirations of groups with special needs and satisfying civic priorities in a sustainable fashion.

User Fee Policy statement:

Toronto will have an equitable approach to user fees which will ensure all residents accessibility to high quality community recreation and leisure programs regardless of ability to pay, while providing fairness to taxpayers, contributing to the long term viability of public recreation and the quality of life in our City.

Guiding Principles (as adopted by the User Fee Committee)

Recreation programs are important municipal services which contribute significant personal, social, economic and environmental benefits which enhance the well-being of Toronto citizens, their neighbourhoods and their local economy

The City of Toronto shall ensure all residents accessibility to high quality community recreation and leisure programs regardless of their ability to pay

The City of Toronto shall ensure equity and fairness to taxpayers and contribute to the long term vitality of public recreation services provided by the City and the voluntary and not-for-profit sectors

The City of Toronto shall encourage maximum opportunity for the enjoyable, healthful, satisfying and creative use of leisure time

Based on this proposed policy statement and guiding principles, different options may be developed.

Policy Options

Three different options were explored following the community consultation, and Community Council discussions. A summary and comparison of the options is outlined on pages 8 and 9. All financial figures are based on current levels of service and current participation levels.

Each option includes a category of programs called "Fundamental Services". Based on current practices, there appears to be general consensus that the following programs be identified with NO USER FEES as a minimum level for providing universal access to a range of recreation programs:

-Volunteer development/general leadership training

-Child summer outdoor drop-in playground programs

-Outdoor public swim and skate

-Basic summer wading pools/spray pads

-Neighbourhood special events

The following options explore a range of choices, which would address the policy statement and guiding principles to varying degrees. Staff would ask that the Economic Development Committee weigh the merits of each option and recommend a preferred option to be considered by the Budget Committee in the context of the overall corporate budget deliberations.

OPTION A - USER FEE COMMITTEE RECOMMENDATIONS

The User Fee Committee recommendations were presented to the Community Councils in November and December for discussion. At their meeting of November 24, 1998 the Committee adopted eight final recommendations as outlined in their report to the Economic Development Committee dated November 25, 1998.

The Committee recommendations propose charging user fees for specialized programs beginning Jan. 1, 1999. This timing is not practical at this point, due to recreation brochure production and delivery frames, a September 1999 implementation would be the earliest start date. Fees would be exempt in high need communities and an access policy would ensure low income families and individuals are not penalized. A surcharge for non-residents would be retained.

The User Fee Committee recommendation that user fees only be applied to specialized programs suggests a potential annual revenue reduction of $9.8 million. User fees for specialized programs would be based on the average of current prices. A net budget pressure of $ 10 million would be incurred for this option. Earlier estimates of this option suggested a revenue reduction of $ 7 - 8 million, and it was on this basis that the User Fee Committee developed their recommendation.

OPTION B -ELIMINATING BASIC FEES FOR EARLY CHILDHOOD, CHILDREN AND

YOUTH

A further option was studied which examined eliminating fees for early childhood, children and youth for drop-in, subscriber and instructional programs. There would be a user fee for these age groups for specialized programs.

This option also proposes that there be elimination of fees for specialized programs in community centres and schools in high risk areas for early childhood, children and youth.

Adults would pay a user fee for all programs.

Older adults could participate in drop-in programs at no fee and would be required to pay a fee for subscriber, instructional and specialized programs.

Implementation would occur in September of 1999. This option would incur a revenue reduction of $800,000 in 1999 and $1.9 million in the year 2000.

OPTION C - FULL HARMONIZATION

Considering the significant budget pressures facing the City, an option to harmonize all fees was also explored. An average of all current prices was applied - with the exception of the "Fundamental Services". This option would generate an additional $6.5 million revenue annually.