A Look at Regional Trends
efore we dive into specific types of facilities, let's take a look at how the information we gathered in our survey breaks down according to regional trends.
We know that some areas of the country have been doing better in the economic downturn than others. We also know that, downturn or not, some areas have specific issues that others don't. For example, construction costs in the mountains tend to be higher. Materials chosen along the coastline need to take saltwater into account. Facilities in Florida and Arizona often make use of shade structures to keep things cool. Facilities further north are far more likely to include winter sports in their programming equation.
When it comes to economics, the downturn has been particularly hard in some areas. The highest rates of foreclosures in 2009, for example, were in Nevada, where more than 10 percent of housing units received at least one foreclosure filing in 2009, according to RealtyTrac, an online marketplace for foreclosing properties. It was followed by Arizona, with more than 6 percent, and Florida, with 5.9 percent. Other states that had the dubious distinction of falling in the top 10 for foreclosure rates were California (4.75 percent), Utah (2.93 percent), Idaho (2.72 percent), Georgia (2.68 percent), Michigan (2.61 percent), Illinois (2.5 percent) and Colorado (2.37 percent).
Many of these states that are experiencing the highest foreclosure rates also are experiencing some of the highest unemployment rates—many in double digits. The highest unemployment rates in the county are seen in Michigan, where 14 percent were unemployed in March 2010, according to the Bureau of Labor Statistics. It was followed by Nevada (13.4 percent), California and Rhode Island (12.6 percent), Florida (12.3 percent), and South Carolina (12.2 percent).
It is difficult to determine the impact of unemployment, housing foreclosures and other economic indicators on a regional basis, as many states within the same region feature widely disparate economic performance. For example, the Midwest, which includes Michigan with its extremely high unemployment, also includes five of the 10 states experiencing the lowest unemployment, including North Dakota, which can boast of the lowest unemployment rate nationwide, at 4 percent.
In addition, while the economy in general may be faring differently in different states and regions, the way it is affecting recreation, sports and fitness facilities can vary vastly from one region to another. In some areas, a culture of recreation and fitness is more engrained than in others.
Of course, this year the United States is conducting its 10-year Census, and it will be interesting to see how the projections made for 2010 after the last census was taken in 2000 compare with actual numbers being gathered now. For now, we have to rely on the projections.
The Northeast has been getting smaller, both in our industry report survey, and according to census projections. While 19 percent of the population was recorded in this region in 2000, the Census Bureau projected that percentage to decrease to 18.1 percent by 2010. In our survey, just 16.5 percent of respondents this year call the Northeast home, a drop from last year, when 18.6 percent of respondents were from the Northeast. (See Figure 29.)
The other region projected to shrink by the Census Bureau—the Midwest—again represented the largest percentage of survey respondents, with 30.9 percent of respondents naming this as their home, an increase from last year, when 28.8 percent were from the Midwest.
The South Atlantic region is growing at the fastest clip, according to census numbers, and representation from this region has also grown in our survey, with 18.7 percent this year reporting they were from these states, compared with 17.8 percent last year.
The West is also growing, and is again the second-largest portion of our survey respondents. On the other hand, the South Central states, which are also growing, saw less representation in our survey this year.
When it comes to facility representation by region, all regions were dominated by parks and recreation organizations, but the proportion of all facility types differed according to the region they were in.
Respondents from the Northeast were less likely than those in other regions to be from park agencies, with just over a third (34.7 percent) working for those types of organizations. (See Figure 30.) On the other hand, they had a higher concentration than other regions of YMCAs (6.4 percent of Northeast respondents), camp facilities (7.2 percent) and health clubs (5 percent). Ice rinks and racquet/tennis clubs were also more prevalent among respondents from the Northeast.
The Midwest featured the highest concentration of schools and school districts, with 16.5 percent of respondents in this region reporting they worked for these types of facilities. This region featured the lowest concentration of golf or country clubs, as well as military installations.
In the South Atlantic, respondents were more likely than those in other regions to represent parks and recreation agencies. Nearly half (47.8 percent) of respondents in this region were from park agencies. This region also featured a higher percentage of golf and country clubs, resorts and resort hotels, and waterparks, theme parks and amusement parks. On the other hand, it had the lowest percentage of school/school district respondents (3.7 percent of South Atlantic respondents) and health clubs (2.2 percent).
The South Central region saw the highest concentration of colleges and universities, with 19.9 percent of respondents in this region representing such facilities. They had the smallest percentage of community recreation and sports centers. Just 6.4 percent of respondents in this region were from such facilities. They also were less likely than others to represent resorts.
On the other hand, the West had a large percentage of respondents from community sports and recreation centers, with 10.4 percent of those in this region working for such organizations. They also were more likely than those in other regions to represent military installations. Respondents in the West were the least likely to be from colleges and universities (11.8 percent of respondents in the West), as well as YMCAs (1.6 percent).
Interesting trends arise when usage statistics are compared with the likelihood of facilities to increase fees. Growing usage seems to coincide with a reduced likelihood of increasing fees.
For example, respondents in the South Central states were the most likely to report an increase in numbers from 2008 to 2009, as well as from 2009 to 2010. (See Figure 31.) Interestingly, in the same time frame, those from the South Central states were the least likely to be increasing the fees they charge for usage of their facilities. Just over a quarter (25.9 percent) indicated that they increased fees in 2009 over 2008, and about the same amount (25.7 percent) were projecting a fee increase in 2010 over 2009.
From 2010 to 2011, those in the South Atlantic region were the most likely to be expecting an increase in the number of people using their facilities. Also in that time period, they were second least likely to be expecting a fee increase. The South Central states were again the least likely to project an increase in fees in that year, with just 32.1 percent expecting an increase. Only 32.3 percent of South Atlantic states were projecting a fee increase in that year.
The other side of the coin largely holds true as well. The regions where usage was less likely to grow were more likely to increase fees. From 2008 to 2009, the Northeast was the least likely to report that the number of people using its facilities had risen. It also was the region where respondents were most likely to report that those numbers had fallen. So, while 47.2 percent of respondents in the Northeast reported an increase in users in 2009 over 2008, 16.8 percent reported a decrease. At the same time, these respondents were more likely than others to report that they had increased fees. Some 42.7 percent of respondents in the Northeast said they had increased fees from 2008 to 2009.
There is a departure from this trend in 2010, when those in the Midwest are most likely to project increasing their fees, while those in the West are least likely to expect an increase in users. But the trend returns in 2011, when those in the West are both the least likely to expect increasing usage, as well as the most likely to be planning a fee increase.
As might be expected, with increasing usage comes a growing need for staff to work at the facilities. And, in fact, while the lowest overall staff level was seen in the South Central states, where respondents report an average of 101.6 staff members (28 percent lower than those in the West, who reported the highest average of 141.1 staff members), these respondents were the most likely to indicate that they have plans to grow their staff this year. At the same time, they also were the least likely to report that staff cuts were in the works. Nearly 18 percent of respondents in the South Central states indicated they were planning to increase their staff levels this year, while 7.9 percent said they were planning staff reductions. This compares with 20.7 percent of those in the West and 19.2 percent of those in the Midwest planning reductions—the highest percentage of respondents by region indicating they had such plans.
Following on the trend of greater usage and greater staff, we see that the South Central region also leads in terms of percentage increase in average operating expenditures between 2008 and 2011. In fact, respondents in this region are expecting, on average, an increase of 13.7 percent in their operating expenditures in this time frame, from $1,611,000 in fiscal 2008 to $1,832,000 in fiscal 2011. (See Figure 32.) Their average operating expenditure for 2009 ($1,837,000) is 5.5 percent lower than the average across the board, but their projected expenditure in 2011 ($2,103,000) is just 4.1 percent lower than the projected average across the board for that year.
At the other end of the spectrum, respondents from the Western states are anticipating a 7.8 percent decrease in their average operating expenditures from 2008 to 2011, from $2,281,000 in fiscal 2008 to $2,103,000 in fiscal 2011. The average operating expenditure among Western respondents in 2009 was 13.6 percent higher than the across-the-board average, and the projected expenditure for 2011 is 10 percent higher than average.
In 2010, when an overall decrease in operating expenditures of 4.5 percent is expected, the respondents from the Midwest were expecting to be hardest hit, with a 6.6 percent decrease in their average operating cost. Respondents from the West also were expecting a larger-than-average decrease, at 5.4 percent. Respondents in the Northeast were expecting very little change in 2010, projecting a 0.07 percent decrease to their expenditures.
In light of the drop in operating budgets, many facilities are making changes to reduce their costs. Regionally, the most likely to have taken any action to reduce their costs were found in the Northeast, where just 6.7 percent said they had not taken action. In the South Central states, on the other hand, 14 percent said they had taken no action to reduce costs.
The most common method all respondents took to reduce their costs was adopting measures to improve energy efficiency. Among the regions, those in the Midwest were most likely to take this step, with 62.7 percent of these respondents reporting they had done so. They were followed by respondents in the West (61.2 percent) and South Central states (60.9 percent).
Staffing cuts were more common among those in the South Atlantic states, where 56.2 percent adopted this measure. In fact, more South Atlantic respondents said they had cut staff than improved energy efficiency (55.9 percent). Those in the South Central states were the least likely to cut staff. In that region, only 39.8 percent of respondents said they had reduced staff.
Respondents in the South Central states were also the least likely to say they had increased their fees. More than a third (35.1 percent) indicated they had done so. In the West, which was the region where respondents were most likely to have increased fees, nearly half (48 percent) said they had done so.
Respondents in the West were also the most likely to indicate that they had closed facilities to reduce their costs. More than one in 10 (12.7 percent) said facilities had been closed in the West. They were followed by those in the South Atlantic states, where 12.3 percent said they had closed facilities, and the Midwest, where 10.4 percent had done so. Respondents in the Northeast were least likely to have closed facilities. In that region, just 5.3 percent of respondents said they had closed facilities in order to reduce costs.
Respondents in the South Central region were the most likely to indicate that they had received funding due to passage of the Stimulus Bill. (For more information on the impact of the Stimulus Bill on all facility types, see page 20.) In this region, 16.3 percent said they had received such help, and 69.9 percent said they had not. Those from the West were second most likely to receive funds, with 15.5 percent of respondents there saying they had been helped. They were followed by the Midwest, where 13.4 percent had benefited from stimulus dollars, and the South Atlantic states, where 10.6 percent had benefited. Those in the Northeast were least likely to receive such help. In that region, 80.8 percent of respondents said they had not been helped by the bill, and 7.5 percent said they had. This could be due to the larger percentage of privately run facilities in the Northeast, compared with other regions.
When it comes to construction plans, respondents from the Northeast and South Atlantic states were most likely to have plans on the board. In both regions, more than two-thirds (66.9 percent in the Northeast and 66.8 percent in the South Atlantic) said they had such plans. Respondents from the West were least likely to be planning to build within the next three years, though more than half (54.9 percent) of these respondents said they did have plans. (See Figure 33.)
Respondents in the South Central states were the most likely to be planning new facilities. In that region, 30.6 percent of respondents had plans for new facilities. Additions and renovations were most commonly planned by those in the Northeast. In that region, 31.4 percent of respondents were planning additions, and 47.8 percent were planning renovations.
This year saw a drop in the amount most respondents were planning to spend on construction in the next three years. Regionally, only respondents in the Midwest said they were planning to spend more. In fact, Midwestern respondents this year said they planned to spend $4,528,000—an increase of 22.3 percent. (See Figure 34.) Their spending plans were exceeded by those in the West, who were planning to spend $5,104,000 on construction, a decrease of 15.9 percent from 2009 figures for this region, and those in the South Atlantic states, who were planning $5,200,000 on construction, a decrease of 12.4 percent. The largest percentage drop in construction budgets was seen in the Northeast, where a 33.1 percent drop was recorded.
Some types of features were more commonly planned in some areas than in others. Splash play areas, for example, are in the works by a higher percentage of respondents in the South Central and Western regions. Playgrounds are most commonly planned by those in the South Atlantic states.
The top five planned features in the Northeast include: park structures, such as shelters and restrooms; bleachers and seating; synthetic turf sports fields; playgrounds; and trails.
In the Midwest, the top five features respondents are planning to add include: park structures; trails; disc golf courses; synthetic turf sports fields; and splash play areas.
In the South Atlantic states, the top five planned features include: trails; playgrounds; park structures; open spaces like gardens and natural areas; and splash play areas.
The top five planned features for the South Central states include: splash play areas; park structures; playgrounds; bleachers and seating; and fitness centers.
In the West, respondents' top five planned features include: splash play areas; fitness centers; park structures; playgrounds; and exercise studio rooms.
Just as some features and facilities are more common in some regions, certain types of programming are more popular in one region than another.
The biggest differences are found in holidays and other special events. While 66.7 percent of respondents in the South Atlantic states said their facilities play host to such programs, only 50.4 percent of those in the South Central states said they include these programs, a difference of 16.3 percentage points. Sport training, such as golf instruction and tennis lessons was most prevalent in the Northeast, where 52.6 percent of respondents cited it as one of their options, while only 37.2 percent of those in the South Central region included this program. Aquatic exercise also showed regional differentiation, with 42.5 percent of Western respondents making it a relatively common program there, compared with 27.4 percent of respondents in the Northeast. And, while 62.3 percent of respondents in the Northeast host day camps and summer camps, only 47.6 percent of those in the West do. Finally, teen programming, more popular in the Northeast with 41.8 percent of respondents including such programs, was less popular in the South Central states, where 27.7 percent included this program.
When it comes to future plans for additional programs, there were also some differences. While fitness programs were the top choice for respondents in the Northeast, South Atlantic, South Central and Western states, in the Midwest, which is the most likely to currently offer fitness programs, the top planned program was educational programs.
In the Northeast, the most commonly selected programs for addition include: fitness programs, teen programs, active older adult programs, mind-body/balance programs, and sports tournaments and races.
In the Midwest, the most common programs respondents are planning to add include: educational programs, environmental education, teen programming, fitness programming, mind-body/balance programs, and active older adult programs.
The most commonly planned programs in the South Atlantic states include: fitness programs, mind-body/balance, educational programs, teen programs, and day camps or summer camps.
In the South Central states, the programs most commonly planned include: fitness programs, teen programs, day camps and summer camps, special needs programs, and individual sports activities like running clubs or swim clubs.
The most commonly planned program additions in the West include: fitness programs, teen programs, mind-body/balance programs, educational programs, and nutrition/diet counseling.
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