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Improving your Cost Recovery

CPRS Fall Forum

Today

• How to get started with determining appropriate levels of cost recovery

• How to make improvements if needed

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Its all about the Policy• Policy defines community values• Policy establishes target levels• Policies will vary across

communities

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Menlo Parks policy• Three levels with criteria for each• High cost recovery (70-100%)• Low cost recovery (0-30%)• Everything else is Mid-level (31-

69%)

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High cost recovery programs• Benefit the individual more than the

community• Generally have competition in the

private sector• Are readily available • Can recover a fee easily

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Low cost recovery programs• Benefit the community, overall• Generally have NO competition in

the private sector• May align with a Council or

community goal• Cannot recover a fee cost effectively

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Cost analysis

• What data have you got?• Can you keep track on your own if

Finance can’t help?• Do you know your overhead costs?

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Know what you’re shooting for

• Direct costs?• Budgeted costs?• Indirect costs?• Then set your target and time frame

–Eat the elephant…–Know what’s realistic

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Planning questions

• What are our priorities for improvements?

• What infrastructure do we need to develop?

• Are we ready to justify changes to our community? If so, how will we do it?

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Menlo Park

• We got EVERYONE involved• Lots of staff training• Improved measuring and monitoring• Held staff accountable (gently)

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Sustainable services matrix

• Hard decisions about service mix and business models

• Helped determine where fee increases were appropriate

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What really worked for us

• Changed our business model where needed

• Set achievable targets over time• Community engagement