Plaza Pool financially drained
Money troubles nearly exhaust savings, putting pressure on county, taxpayers
ALPENA — The Plaza Pool is leaking money and its fund balance has all but dried up.
The situation puts Alpena County, which owns the pool, and county taxpayers in a pinch. If pool finances don’t improve, user fees could be increased, larger allocations from the county’s Youth and Recreation millage could go to the pool and away from other projects, or a property tax specifically for the pool could be proposed to keep the pool afloat.
Another option is to close the pool for portions of the year to cut costs. Officials haven’t at this point considered closing the pool all together.
At the end of 2014, Plaza Pool had a fund balance of a tad more than $57,000. Over the last five years, that total has dropped to $1,150, as of June 30 or this year.
The situation is so serious that, for three consecutive years, the county has had to allocate money to the pool’s budget to keep it from running out of money. In 2017 and 2018, the county had to inject $15,000 each year to keep the reserve fund solvent. This year, an additional $25,000 was needed.
County Treasurer Kim Ludlow said the county will likely have to continue keeping the pool’s fund balance afloat in the coming years. She said that, if the county doesn’t contribute additional funds, the state could get involved.
“If you even have a $1 deficit, (the state) demands you do a fund deficit plan that is approved by the state and implement it,” Ludlow said. “It is like a three-year process. In a sense, the state takes over.”
Norm Sommerfeld, owner of Synchronization Management, which manages the pool, said all cost-cutting and revenue options are on the table, but all of them come with complications.
If prices go up, fewer people use the pool and revenue is lost. If more is allocated from the Youth and Rec millage, other projects in the county would likely get denied funding, which may not be popular with taxpayers who voted for that millage and expect projects in their communities to be funded. If the pool closes for the summer months, seniors who use the pool for recreation and therapy would miss out on those opportunities.
Sommerfeld said there are many reasons why the account has been depleted, including water bills as high as $16,000 from leaks and an increase in minimum wage over the years.
“When we started this venture, minimum wage was a little over $6 an hour, and now it is $9.25,” he said. “That is probably our main expense.”
‘A BUNCH OF SMALL PIECES’
For many years, Alpena Public Schools paid the utility bills for the pool — it’s located at Alpena High School — and purchased pool hours for the school’s swim team and swim classes. That hasn’t been the case for several years after the school ended the swim team and swim classes, and that loss of revenue and additional costs to the pool have had a significant impact on the budget, Sommerfeld said. He said the utility costs are usually between $65,000 and $80,000 a year, which is hard to offset with new revenue sources.
“It is just a bunch of small pieces that have come together to make this a huge issue,” Sommerfeld said.
Like other county facilities, the pool is required to pay its share of bonds that were sold for 2013 renovations to improve energy efficiency at several county buildings. The pool pays $2,063 each month — $24,763 a year — back to the county, which pays the total bond payments.
The primary reason the pool has survived is because the county has given so much from the countywide Youth and Recreation millage. Since 2011, the pool has received $719,550 in allocations, about 16% of the total allocation for projects across the county over those years.
Sommerfeld said that, without that money, and the tens of thousands of dollars raised by Friends of Plaza Pool and other sponsors, the facility would have closed a long time ago.
This year, committee overseeing allocations from the millage gave the pool $82,125. Sommerfeld said he intends to ask for $95,000 for 2020.
The county’s Older Persons millage also provides $15,000 in tax funds to the pool to reimburse the pool for lower rates charged to senior citizens. Sommerfeld said he intends to ask for an additional $10,000 next year because the $15,000 runs out halfway through the year, but the pool continues to charge the lower rates all year.
“We have been eating the rest,” he said.
‘WE CAN’T CONTINUE TO FUND IT’
Alpena County Commissioner Brenda Fournier, who has been vocal about her concerns with the county paying for the pool and Northern Lights Arena, said there is a small section of the population in the county that uses the pool. Continuing to use taxpayer money to bail it out not ideal.
She said county revenues have been stagnant for years and added that expenses such as the pool put further undue pressure on a budget that is already more than $700,000 in the red.
Fournier said that, perhaps, it is time the county attempts to get a pool-specific millage to keep the doors open and bolster the fund balance.
“I think, if it is important for people, then we need to have that discussion,” she said. “Right now, we can’t continue to fund it for the limited amount of people it serves.”
Sommerfeld said the county has been very supportive of the pool and acknowledges the difficulty it creates when unplanned financial support is needed. He said the county has invested about $1 million into the building itself for a new roof, repairs to a collapsed wall, and other infrastructure upgrades.
That is why he believes it may be time for the voters to decide if the pool remains open, closes, or only opened in a limited capacity, and whether or not they want to fund it accordingly.
“If we could get something to the tune of $200,000, whatever that millage size would be, that would be great,” Sommerfeld said. “I think it is getting to the point where we have to ask the taxpayers for support and let them decide if they want a public pool in their county or not.”
Steve Schulwitz can be reached at 989-358-5689 at email@example.com. Follow him on Twitter @ss_alpenanews.com.
Youth and Rec. allocations to Plaza Pool
A look at how much money was given each year from the county’s Youth and Recreation millage fund to Plaza Pool
Source: Alpena County