October 2020 - Parks & Recreation - 30

RESEARCH
As Park and Recreation Funding Falls,
Demand Grows
By Kevin Roth

he damage the coronavirus (COVID-19) pandemic has wreaked
on park and recreation budgets is startling. Park and recreation
professionals and their agencies have reaffirmed their essential nature throughout the public health crisis. Public parks, trails and
other open spaces provided millions of people countless opportunities to improve one's physical and mental health every day, often serving as the sole
remaining respite as other services and businesses shut down. The list of
different ways parks and recreation has served the public is immeasurable.

Yet even in the face of recordsetting usage, many park and recreation agencies are facing their
greatest budget crisis ever. Twothirds of park and recreation leaders responding to a late-June NRPA
Parks Snapshot Survey (nrpa.org/
ParksSnapshot) say they were slashing their operations budgets. The
typical operations budget cut ranged
between 10 and 19 percent from
original levels, with 1 in 6 agencies
reporting cuts of at least 30 percent.
Similarly, 3 in 5 agency leaders say
they slashed capital expenditures,
with typical reductions of at least
half of original budgeted levels.
Unfortunately, this is not surprising. According to the 2020 NRPA
Agency Performance Review (nrpa.
org/APR), the typical park and recreation agency recovers more than a
quarter of its annual operating budget through registration and entry
fees, rental income, sponsorships,
concessions and other earned revenues. At best, these revenues are
challenged in a pandemic world,
but for many agencies, these revenues are simply nonexistent.
Also weighing heavily on park and
recreation agency budgets has been
the steep decline in local and state
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Parks & Recreation

government tax revenues. The 2020
NRPA Agency Performance Review
finds more than 70 percent of operating funds at the typical agency comes
from a combination of general fund
and dedicated tax support.
The National League of Cities
(NLC) City Fiscal Conditions 2020
report
(tinyurl.com/yxlw7ctb)
paints a bleak picture of the damage suffered by cities' major revenue
streams in just the first few months
of the pandemic. NLC estimates
sales tax revenue plummeted 10.9
percent in fiscal year 2020, as retailers and restaurants shut down or reduced operations during the spring
and early summer. The sharp rise
in unemployment resulted in a 3.4
percent drop in income tax revenue.
Property tax revenues held firm,
rising 1.9 percent for the year. (Because of the property assessment
process, it can take several years
before a recession detrimentally affects property tax revenues.)
Even worse, city finance leaders are pessimistic for the future.
Eighty-seven percent of city finance officers indicate that their
government will be less able to
meet their 2021 fiscal year financial
needs than they were in 2020.

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Respondents to the NLC survey
anticipate that general fund revenues will decline 13 percent during
fiscal year 2021. This is particularly
noteworthy, as revenue bottomed
out six years after the 2007 start
of the Great Recession and was
" only " off 12 percent from prerecession levels. Even more worrisome is that we do not know when
the bottom of this financial crisis
will occur, meaning local governments may face further fiscal challenges in the coming years.
Even as local government revenues
continue to fall, the demand for their
services rises in response to both the
pandemic and the recession. The fiscal stress experienced by most cities,
towns and counties will only expand
in the coming years and will result
in even greater competition among
government services for funding.
But one thing is clear: the public
wants high-quality parks and recreation and is willing to pay for it.
NRPA's Park Pulse poll (nrpa.org/
ParkPulse) finds that two-thirds of
U.S. adults support their local government dedicating revenues, taxes
and levies that specifically target
park and recreation operations and
expansion projects. It is critical to
share your team's incredible contributions to every political leader,
funder, stakeholder, media member and indvidual in the general
public to ensure you will be there
for them tomorrow.
Kevin Roth is Vice President of Research,
Evaluation and Technology at NRPA
(kroth@nrpa.org).

October 2020 - Parks & Recreation

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