|
Hornsby Shire Council |
Attachment to Report No. EN48/08 Page 0 |
In
preparing our submission to council for license fees a number of commercial
considerations have been taken into account to arrive at the proposed license
fee.
- Current vs proposed operating
charges
- Proposed membership growth
and associated income from such
- Decreased revenue raising
opportunities to run Zone or multi-Pony Club days due to reduce parking at new
site
- Capital expenditure depleting
existing funding for Arcadia Pony Club in order to move to new grounds
- Foregone projects due to
additional capital expenditure on storage facilities, day stalls and shade
structures
- Foregone sponsorship
opportunities
- Current financial climate and
impact on member discretionary spending
- Increase in insurance fees
due to equipment now being stored on public usage land
In
consultation with our members, Arcadia Pony Club would like to propose that the
licence fee is set at $2718 per annum
fixed for the 2009/2010/2011 with the only increase being an adjustment for CPI
on an annualised basis.
An
explanation of each commercial consideration is detailed below:-
Current vs proposed operating
charges
Council
have provided confirmation that the new license fee will be an all inclusive
fee to encompass many of the operating costs currently borne as individual fees
to Arcadia Pony Club. It is the Pony Club’s
understanding that the following items are now included within the license fee:
- Exclusive use of grounds for
24 occasions per annum
- Garbage and waste collection
- Mowing, garden and bridle
trail maintenance
- Water
- Electricity
- Cleaning of amenities
- General maintenance of
infrastructure
If
Arcadia Pony Club were to remain at
|
Current facility related fees - Johnson Road 2008 |
|
|
Annual
Lease fee @$90pcm |
1080 |
|
Garbage
Collection |
384 |
|
Electricity |
654 |
|
Water
|
400 |
|
Mowing |
N/A |
|
Mowing
consumables |
100 |
|
Mowing
repairs |
100 |
|
Cleaning
of amenities |
N/A |
|
Total annual fees 2009 |
$2718 |
Proposed membership growth
and associated income from such
Currently
our membership base and fees associated with such form 80% of our annual income
stream.
Our
membership over the past 3 years reached a peak of 68 riding members in 2007
and then went into decline in 2008 and 2009.
This decline has been attributed to outgrowing our current grounds where
former members moving to other clubs have sighted lack of facilities as being
the main reason they have chosen to move to a neighbouring club.
A
program to attract and retain new members once we move to RSF will commence to
increase our baseline membership and baseline income.
However,
as the council proposed fee of $3850 per annum represents a 35+% increase over
and above our current operating costs and we cannot grow our membership by a
corresponding 35+% amount initially but only in a staged approach.
We
propose to increase our membership by 10% year on year over the next 3 years to
help meet these increased charges in 2013.
Depletion of funds due to
unexpected basic infrastructure capital expenditure and foregone sponsorship opportunities
Arcadia
Pony Club has had an active fundraising drive over the past 3 years to fund
projects required at the new grounds such as a cross country course which was
projected to be more than $20,000 in Pony Club funds and additional sponsorship
from the community to construct.
Whilst
Arcadia Pony Club understands the councils need for funds and sponsorship for
the next 3 years to be spent on infrastructure, we will have no opportunity to
tap existing sponsors or funds for the next 3 years. All existing funding has
been consumed and all future sponsorship bought forward to fund storage
facility, day stalls and shade structures.
It
will take at least 3 years to restore our capital to the levels we have
currently pre-instrastruture spend.
Decrease in revenue raising competitions
due to limited parking space at RSF
Currently
we are able to run Zone events or events where there is participation by
multiple pony clubs at
Currently
we run 3-4 such events annually to fund capital equipment purchases or capital
projects such a building a cross country course.
Over
time opportunities may arise for alternative parking arrangements to be
resolved to recommence such events at RSF but in the short term understanding
the community sensitivities to parking and noise these cannot be contemplated
or relied upon for additional revenue.
Increase in premium for
coverage of equipment on a public land vs exclusive use land.
Arcadia
Pony Club has a significant investment in equipment such as show-jumps,
trailers, tractors, sporting equipment etc.
Such equipment is currently insured against fire, theft and damage. Our insurer has informed us that by moving
this equipment to land which is classified as public use rather than exclusive
use this will double our current premium.
Whilst this is a side effect of moving to new grounds insurance of our
equipment is essential and this is an additional cost that we will need to find
significant funds to meet.
Current financial climate and
subsequent impact on household discretionary spending
Whilst
at this stage no one can predict the impact of the worsening global financial
crisis one of the first areas to diminish will be household discretionary
spending. For Pony Club horse riding and
associated activities are fairly and squarely in the discretionary spending
category.
Whilst
we have done a forward projection for the next 5 years to ensure the Arcadia
Pony Club remains financially viable these projections may be impacted lower
than expected discretionary spending on Pony Club related activities.