Feature Article - June 2019
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2019 State of the Managed Recreation Industry

A Look at What's Happening in Recreation, Sports and Fitness Facilities

By Emily Tipping

From fiscal 2017 to fiscal 2018, respondents from camps, colleges, health clubs and parks reported increases to their average operating expenditures, while other market segments reported decreases. The greatest increase was reported among camp respondents, who saw their average operating expense rise a dramatic 55.7 percent, from $880,000 in 2017 to $1,370,000 in 2018. They were followed by respondents from colleges (a 15.5 percent increase, from $1,930,000 to $2,230,000); health clubs (a 6.3 percent increase, from $1,580,000 to $1,680,000) and parks (a 0.5 percent increase, from $2,020,000 to $2,030,000). (See Figure 14.)

The sharpest decline in average operating expenses between 2017 and 2018 was reported by respondents from schools, who saw their average operating cost fall 22.5 percent, from $1,690,000 to $1,310,000. Decreases were also reported by respondents from Ys (down 9.3 percent, from $2,910,000 to $2,640,000), and rec centers (down 6.9 percent, from $1,310,000 to $1,220,000).

Looking forward, only college respondents expect their operating expenses to decrease between 2018 and 2020. They projected a 1.3 percent decrease, from an average of $2,230,000 in 2018 to $2,200,000 in 2020. The greatest increase in operating expenditures is expected among respondents from health clubs. Health clubs said they expect their operating expenses to climb 21.4 percent, from $1,680,000 in 2018 to $2,040,000 in 2020. They were followed by rec centers (a 9 percent increase, from $1,220,000 to $1,330,000); and Ys (a 7.2 percent increase, from $2,640,000 to $2,830,000). More modest increases are expected among respondents from parks (up 3 percent from $2,030,000 to $2,090,000); schools (up 2.3 percent, from $1,310,000 to $1,340,000); and camps (up 2.2 percent, from $1,370,000 to $1,400,000).

When it comes to costs and revenues, the percentage of costs recovered tends to depend on the type of organization represented. Obviously, private for-profit organizations will be more likely to cover a higher percentage of their operating expenditures via revenues than nonprofits and public organizations. On average, all respondents said they recover 47.3 percent of their operating costs via revenues, down slightly from 2018, when the average was 48.5 percent. For public organizations, 42 percent of costs are recovered. This compares with 60.1 percent for private nonprofits and 69.3 percent for for-profit organizations. (See Figure 15.)