Day 2: Theory of Revenue Development

March 12th
Sunny and clear but 27 degrees at 8am

NOTES from Day 2 (101 & 102)

*P&R = Parks and Rec

*Waiting for NRPA to reset password to NRPAConnect. Cannot access instructors PPTs...

The Enterprise Approach
Presented by M Ruiz from Miami-Dade County, Florida

Theory behind the Enterprise approach which is boiled down to getting resources to achieve organizations Mission.

Enterprise Approach is definitely about Social Entrepreneurship (Social, Environmental, Cultural) and finding a balance between Social and Financial entrepreneurship is important so you can focus on things that need to be subsidized to make services accessible.

The Enterprise mindset is understanding that everything an organization does goes to the greater Mission.

Enterprise Divisions (those that make money) give the net profit to other divisions to make services accessible to everyone in the community. For example, a contract class that makes a lot of money my haver the net profits go to subsidizing the same class in another part of town where residents may not be able to afford the full class rate OR the net profit may go to a camp that is not financially self sustaining but is a great program that provides greater access to people in the community.

Levels of Enterprise include:

• Agency
• Facility
• Program
• Event

There are social and environmental responsibilities that P&R are trying to achieve.

Tenets of NRPA include:

In order to make the Enterprise approach work you need good leadership that can help keep the organization on track and focused on the Mission the organization is trying to achieve. They need to be able to articulate why funding is spent to make things not only equal but equitable for the community.  Why some facilities, programs or events may make a lot of money that then gets rerouted to other facilities, programs, events.

Revenue Management Philosophy
by Richwine

"As an industry we are all over the board in regards to what is considered cost recovery"...does it include staff time or not...what constitutes 100% to one person may mean something different at another organization.

There is the:

Social Model (intrinsic value) - the value P&R brings to the entire community

VS.

Business Model - what each program generates (the business model is secondary to the social model)

 Types of Revenue Sources:

Compulsory Resources - revenue through taxes (property, sales, income tax, special assessment - hotel, rental car, food & beverage)

Financial Resources - earned income (entrance/admission fees, rental, user registration, sales charges, license/permits, special services fees)

Earned Income/Entrepreneurial Funds - Self sustaining department (golf courses, specialty, water arks, zoo, performing arts venue, convention center)

Revenue Received through Legal Agreements - Land Leases, Cell Towers, sale/lease backs, bonds, user agreements, concessions

Direct Costs - Directly attributed to program

Indirect costs - based on staffing, (often non-resident)