BREC’s cost of running the Baton Rouge Zoo increased nearly 10% in 2014 over the previous year, as did the cost of operating recreational programs like summer camps and tennis lessons. Expenses related to running BREC’s seven golf courses, meanwhile, increased 4% in 2014 over the previous year.
Those are some of the findings of a recently completed audit of BREC’s books for 2014, which showed that expenses overall increased 7%—to $54 million from $50.5 million, while revenues increased just 5%—to $68.4 million from $64.9 million.
As in previous years, the audit shows that almost all of BREC’s programs lose money—that is to say they’re not self supporting, but are funded primarily through dedicated property tax revenues. Recreational programs, for example, cost $14.6 million to operate last year but only brought in $3.4 million in fees, so the expenses were offset by more than $9.2 million in tax revenues. Golf operations cost $5.3 million but brought in less than $3.4 million in greens fees, so nearly $1.98 million in tax dollars were needed to break even. Zoo operations cost nearly $4.4 million but only brought in $2.2 million, so the program required an influx of $2.1 million in tax revenues to make up the difference.
BREC Superintendent Carolyn McKnight says the situation at BREC is not atypical.
“Every park system in the country is subsidized by tax-supported revenues,” she says. “Some more than others. We are doing everything we can to ensure we review those subsidy levels and keep our expenses at a minimum.”
According to the audit report, which was prepared by Postlethwaite and Netterville, revenue increases were largely due to a 4% increase in the property tax rolls. The BREC ad valorem tax generated $53.4 million in 2014, up from $51.3 million in 2013.
The audit attributes BREC’s increased expenses to the expansion of facilities and increased promotional costs. Administrative expenses were particularly higher in 2014 than the previous year, increasing nearly 9% to $18.6 million from $17 million.
McKnight attributes the jump in administrative costs to several factors, including a special election in 2014 for which BREC had to pay $500,000, higher employee retirement costs, increased insurance costs and new software.
“Our personnel system wasn’t talking to our finance system so we had to buy a new software system,” she says. “So those are some of the big ticket items that we had to take on.”
The audit cites BREC for its failure through much of 2014 to reconcile its bank statements with its general ledger, which the auditors said could call into question the accuracy of BREC’s 2014 financial statements.
BREC attributes the misstep to high turnover in its finance department—it lost two CFOs in one year—and the implementation of new accounting software. In its official response to the audit, the agency says it has corrected the problem.
“Currently a new finance director is in place and departmental staff has received the additional training on the new software necessary to perform timely reconciliations,” BREC says in its response.
—Stephanie Riegel
