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Wednesday, December 11, 2013

Follow up e-mail exchange between RCC and Reston 2020 on Reston Recreation Center issue

Below are two e-mails.  The first e-mail, sent by RCC's Executive Director Leila Gordon, expresses her concern that there are significant inaccuracies in our Reston 2020 blog post and that RCC has been transparent in its processes.  The second e-mail is Reston 2020's response, noting key areas of lack of transparency and addressing the perceived inaccuracies raised by Ms. Gordon.  They are posted here to help ensure that the Reston community has as much access a possible to the ongoing RCC planning to build a financially unsustainable recreation center in Baron Cameron Park using Reston tax dollars.  Both posts are lengthy.   

Message from Leila Gordon, Executive Director, RCC:

Subject:  Reston 2020 Post about RCC Planning

Dear Colin and Terry,

I am writing to object to your most recent Reston 2020 posting (copied below my signature) regarding RCC planning for future indoor recreation in our community. It is inaccurate. Beyond the inaccuracies, it is needlessly confrontational and disrespectful of RCC Board of Governors members. The spirit of dialog regarding this issue has been civil, open and flexible on our part; the discussions between RCC Board members and RCA Board members has been conducted up to now with a view to the community’s interests being served and acknowledging that is the intent of everyone involved in both organizations. The Reston 2020 post accuses our Board of acting “stealthily” – nothing has been done “stealthily” – and your assertions are just plain wrong about where things stand with respect to the current status of site identification and data collected.

I think your post needs revision to reflect our actions fairly in these aspects:

1. The Building Committee report and subsequent Board affirmation is that locations (plural) – among those suggested by the community – worth continued pursuit are Reston Town Center North and Baron Cameron Park, with the Hunters Woods site a third possibility for expansion should those two sites prove unworkable. Further, as the minutes of our meetings also reflect, it was specifically clarified at the November Board meeting that if another site suddenly becomes available and attractive from both location and cost perspectives, nothing about our decision-making to date would preclude us from pursuing such an alternate location.

2. The Board has communicated directly to Fairfax County offices discussing the potential for public facilities at Reston Town Center North that we wish to have an indoor recreation facility considered among the public facilities that redevelopment there could produce. We received a letter in response to our formal request indicating that such a facility is being considered. We have communicated our interest in both locations, Reston Town Center North and Baron Cameron Park, to our colleagues at the Park Authority. All of this information is in our public records as it has been stated and documented in our meetings.

3. Our processes have been completely transparent. The studies, discussions, input and dialog with members of the community at our meetings have all been fully accessible. We have consistently responded in full and in detail to community members’ questions and all the materials we have produced or recorded have been made available on our website.

4. There is absolutely no relationship whatsoever between our decision-making on indoor recreation and Lake Anne redevelopment.

5. As documented in the Board package for our December meeting, our conversation with Supervisor Hudgins at the November Board Orientation (which was also publicized and conducted in accord with open meeting requirements) included discussion of both the Reston Town Center North location and funding from proffers being of great interest to us and that we welcomed her support as planning progresses.

6. The Brailsford & Dunlavey update did outline that there would be a core user population of 1,500-1,700 people that could be relied on as regular, fully engaged/paying types of users. Beyond that, there are a variety of other users that would be expected to contribute to utilization of this type of facility on a more casual and/or less frequent basis. The purpose of identifying “core users” is to help us understand the most conservative outline of planning for cost recovery. Core users would be augmented by other community users along a full spectrum of participation.

7. Nowhere does the update or the original report describe a pro forma that contemplates that less than half of the users would be Restonians; there were questions asked when Craig made his presentation about how the ratio of Reston/non-Reston users impacts the pro forma spreadsheet results; perhaps you confused those questions with the data presented. The assumption we requested Brailsford & Dunlavey use has been 90% Reston use. That is the current utilization pattern for RCC.

8. The cost recovery slides in the update contemplate cost recovery at current RCC Reston patron levels of subsidy; if we adopt fees more aligned with Fairfax County Park Authority or other public provider fee rates, that rate rises as the subsequent slide illustrates. However, both slides are based on an assumption that RCC as a facility operator would continue a higher level of subsidy to Reston patrons as a result of the tax district, hence a less robust cost recovery fee schedule than that of similar public facilities. None of the slides or studies account for the impact of other funding resources – without knowing the scope of other resources we felt it important to understand cost recovery on the basis of our current model.

9. The data we have obtained to date from Brailsford & Dunlavey also doesn’t incorporate future population impacts, nor does it include consideration of Reston-located businesses’ employees beyond a minimal level as “corporate” types of pass users. Reston’s growth on both fronts would change the potential service profile and cost recovery performance of a new facility.

10. This issue is one of great importance to the community and to our Board of Governors. However, it is not the sole issue with which our planning for the future is concerned. Our agenda for our January 3,4 sessions will focus on where we find ourselves in the current RCC Strategic Plan and how we might position ourselves for the future in light of where we are now. The public is welcome to attend and listen; comment opportunities will be provided at the beginning of each day’s efforts.
I hope you will correct your post –especially its headline – to reflect the above information, Terry. Given how collegial and open we have been with regard to discourse with our community on this issue, I find the tone of your post and its assertions of “stealth” really disappointing. My understanding is that RCA is seeking collaborative and collegial relationships with other Reston civic organizations; this is an odd path to pursue toward that end.

Leila Gordon
Executive Director
Reston Community Center

Message from Terry Maynard, Co-Chairman, RCA Reston 2020 Committee:

Subject:  Re:  Reston 2020 Post about RCC Planning


Thank you for your feedback on the Reston 2020 blog post concerning RCC’s efforts to establish a new Reston recreation center.   In spite of what you say, Reston 2020 still believes that RCC has been acting in a less than transparent way and disagrees that the post was substantially inaccurate.

Let’s start with the issue of stealthiness, specifically, the letter RCC sent to the FCPA following the BOG’s receipt and acceptance of its own Building Committee report:  According to information we have from County officials, RCC shared that information with FCPA and received a formal request from RCC to work collaboratively to build an indoor recreational facility “in the park.”  That would be Baron Cameron Park, not the FCPA-owned park land in Town Center North. 

That is the information we have.   Maybe you can clarify matters, but until we see the letter(s) RCC sent to FCPA concerning the matter, we must consider it accurate.  It would have been helpful had you made RCC’s request to FCPA to work collaboratively available to the public, a step you could have taken as part of your e-mail to us, but you didn’t.

We would also note that the May 2013 B&D update report notes, p. 2.3, that “A separate analysis was being conducted by RCC to understand the potential impact on the small district 5 tax rate.”  If this has been completed—or even if it is still in draft—it is important to share this information with the community now.   Our earlier post makes an estimate that, in the early years of a new recreation center, the STD$5 tax rate would need to rise nearly 60% to $.075/$100 valuation. 

To help clarify these matters, please consider this e-mail an official FOIA request by Reston 2020 for all correspondence, including e-mails, text messages, memoranda, letters, memos for the record, agreements, reports, meeting notes, etc., between and/or among RCC, its Board of Governors and its management and staff, and the FCPA, including the Park Authority Board, management, and staff regarding the proposed construction of an indoor recreation center in Reston from December 1, 2012 through your receipt of this e-mail. 
Hopefully, making this information available to the public in a timely manner will make the dialogue on a proposed Reston recreation center more transparent and positive. 

Here are some brief comments on your points:

1.  The Building Committee report.  What you say is not inaccurate, but it is also incomplete as to the specific nature of the committee’s recommendations re BCP and TCN.  Here are the recommendations for those two options with emphasis added:
  • Baron Cameron Park:  “Based on the below information, the Building Committee recommends that the Board consider this site a strong location option for a new recreation center; the Board should continue to work with the Park Authority to explore an RCC recreation center at this location.”
  • Town Center North:  “Fairfax County is currently master planning this site and the RCC Board has requested that a recreation center be included in the master plan. The Building Committee suggests that the Board continue to pursue this request with the County and that this location be considered a viable location, and should be pursued in consultation and collaboration with the Park Authority.”
Which do you believe is the committee’s “strong” preference?  More broadly, these preferences (along with the third place RCC/HW location) have remained unchanged since at least the January 2012 RCC Long Range Committee planning offsite nearly two years ago , according to notes of that meeting.   

2.  Communications concerning locations.  If this information is available in public records, it is unretrievable.   I have searched the County website, including the FCPA area, and wandered through the RCC website at length (which has no search tools).  Internet searches using Google have been equally unproductive.  The only materials I have found are those posted on the RCC BOG webpage—meeting materials and various reports by B&D, RCL, etc.

3.  Transparency.  Until the public knows the full nature of RCC’s involvement with FCPA in siting a recreation center at BCP, you cannot claim to have been transparent.  Hopefully, our FOIA request will shed light on those discussions.

4.  BCP location and Lake Anne Redevelopment.   The statement that there is “no relationship whatsoever” between the proposed location of the recreation center and Lake Anne redevelopment strains credulity.  Indeed, the new Lake Anne Comp Plan calls for the developer to make contributions to the development of a recreation center (& other recreational facilities) “in the vicinity.”

5.  Conversation with Supervisor Hudgins.  It is important that Supervisor Hudgins continue to support the construction of any Reston recreation center in Town Center North as part of the urbanization of central Reston.  Proffers will play a vital role in a wide variety of critical infrastructure improvements tied to the urban transformation of the Silver Line station areas. 

6.  B&D November 2013 Reston market “potential” assessment:  In its 2009 final report, B&D made an important distinction between the “potential” market (the number of people who fit the profile for usage of a rec center) and “core participants,” people who would likely be regular users.  It specifically used the word “potential” in identifying the 1500-1700 in its latest update which, frankly, seems low to us as well.

Still, even 1500-1700 regular Reston users is an extremely small number—about 2.7% of Reston’s population.  The May 2013 update’s “Option B” (an 84,900 SF structure with facilities similar to those proposed in November, then costing $33.9MM) offers a good cost grounding in how much we will pay for these Restonians’ use of a new recreation center.  RCC will invest $35-$40 million per the November 2013 brief (higher per SF than in June 2013) in construction costs and, from Option B in the June update, $1.8-$2.4 million in annual operating costs over the first decade PLUS an annual debt service cost of $3.0 million or so on a $37.5 million, 20-year AA bond at 3% using straight line bond amortization.  (Note:  For reasons that are unclear, B&D appears to use a mortgage amortization approach, which leads to a significantly lower annual debt service cost forecast as principal is paid down over time.  For bonds, the borrower pays interest on the full value of the bond over the period of indebtedness, then pays back all the principal.)  That’s about $4.8-$5.4 million per year total expenditure leading to an additional $110-$140 tax burden per Reston household, depending on whether RCC charges “Reston rates” or “Fairfax County rates.”  Why should any Restonian pay more than $125 per year so 1500-1700 people, nearly two-thirds of whom have a household income exceeding $75,000 according to B&D’s November presentation, can regularly use a rec center at a substantial tax subsidy above even operating costs?

7.  Non-Restonian users.   You are right, nowhere does any of B&D’s reporting explicitly “contemplate that less than half of the users would be Restonians.”  Unfortunately, when you put B&D’s numbers together from the 2009 report as RCA did in its mid-2013 report on the Reston recreation center initiative, that is exactly the result you will find.   As the table on p. 20 of that report shows, with the exception of the swimming facilities with a low non-Reston capture rate (10%), B&D’s data shows that all of the facilities would be used more by non-Restonians than Restonians.   B&D hasn’t updated those data or calculations since, but we believe there is no legitimate reason to believe they would change substantially.   

A couple of related factors presented in various B&D reports point to a greater use of a Reston recreation center facility by non-Restonians than by Restonians.
  • The B&D reports going all the way back to 2009 are  confounding because they all assume that Restonians will account for 95% of total usage.  In part, this leads to the low level of facility use B&D describes in its various reports—and the resulting high tax subsidy required to make such a facility financially sustainable.  B&D, in fact, states in both its 2009 report and 2013 update that a 10% capture rate of the extended market is a “conservative” estimate.  The May 2013 update, p. 2.7, makes that statement and shows the total area potential core market in Exhibit 2.5:  Reston = 22,000, Non-Reston = 236,000, ten percent of which is 23,000—and more than the number of Restonians likely to use the facility.  As the table in RCA’s report shows, higher capture rates lead to a greater share of usage by non-Restonians.
  • We would also note that B&D’s May 2013 report shows, Exhibit 2.11, p. 2.12, that Reston’s private facilities serve 22,750 people—more than the core participant market it now estimates for Reston.   The result is that, absent huge tax-subsidized usage fees for Restonians that undercut the existing private recreational facilities, the number of Restonians who would likely use a new Reston recreation center will be extremely small. 
The fact that more non-Restonians than Restonians are likely to use the new recreation center is a huge and valid argument for the rec center not to be paid for by the citizens of Reston via the STD#5 tax vehicle.  The facility should be an FCPA facility, built and managed by the FCPA within the County budget and charging 100% operating cost recovery fees like other County recreation centers.  As it is, Restonians are helping to pay for close to a dozen other County recreation centers as part of our annual property tax bill.  Reston 2020 believes it is time for the rest of the County to contribute to a recreation center in Reston.

8.  Cost recovery.  Actually, the Reston 2020 post specifically identified both the “Reston Rate Structure” (50% maximum recovery) and the “Fairfax County Rate Structure” (71% maximum recovery) in our post.  Both of these recovery outcomes are inconsistent with the goals laid out at the beginning of the latest (and earlier) B&D presentation(s) and the expectations of other communities of covering operating expenses through operating revenues.  In fact, B&D’s May 2013 executive summary states (p. 1.3):

In B&D’s experience, most of the successful recreation facilities are able to cover 80-90% of operating costs with the remaining expenses subsidized by various public monies.  In the case of Fairfax County, all of the recreation facilities operate at break-even or better. 

For the record, our calculation of the County’s experience based on data for four County rec centers described in B&D’s 2009 report is that they achieve a 114% average recovery rate (see table on p. 21 of RCA’s report).  Why should the people of Reston be forced to live with a lower, unacceptable recovery rate expectation?

9.  Future impacts.  Actually, B&D’s May 2013 report lays out a 30-year pro forma balance sheet statement for the recreation center (both options) which we assume includes population increases.  It explicitly assumes expense increases (3.0%) and larger revenue increases (3.65%).  Its most recent November presentation update makes only cost recovery percentage projections for the first five years of operations—and its results are little different than the June 2013 update.

10.  Offsite agenda:  We look forward to seeing the agenda in a timely manner and hope it offers significant opportunities for public contributions. 

We would close by noting that we understand that FCPA will be forwarding to the Park Authority Board its recommendations for the Baron Cameron Park master plan for its meeting in February 2014--before the public has had an opportunity to review it.  Instead, the community will only get to comment on it after it has been reviewed by the Board.  We believe it is important that the Reston (and broader County) community have an opportunity to review and comment on this draft plan--at least by correspondence if not a pubic hearing--before it goes to the Park Authority Board.  The County's Board of Supervisors, Planning Commission, and Library Trustees--the boards I'm familiar with--take public comments on their plans before reviewing them.   For the Park Authority Board to do otherwise would be absolutely contrary to a constructive open process.

In the spirit of community transparency, I will be posting your e-mail and my reply on the Reston2020 blog for the public to see. 

Terry Maynard
Co-Chairman, RCA Reston 2020 Committee
Reston 2020 Blog Administrator

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