Funding Area: Local Funding

A city’s general fund pays for most capital and operating expenses. The revenue comes primarily from property taxes and elected officials allocate the funds to city functions through the annual budget process. Parks and recreation funding can, therefore, vary, influenced by local politics, a city’s economic fortunes and the engagement of citizens in the budget process.

Parks and recreation departments are often the first to have their budgets slashed and the last to see them increased. Park advocates and nonprofits play an important role in ensuring consistent funding for parks year to year. Cities with strong nonprofits and organized advocates tend to have the most stable public funding for parks. For more information on making the case for parks and building a strong network of park advocates, see Other Resources below.

Parks are ideal venues for special events like concerts, a marathon or a wedding, which open revenue opportunities.

Market community-based concessions, develop local events tailored to the community needs and interests, and promote local hiring and procurement policies in neighborhood parks.

Many urban park systems find it profitable to have outside entities run restaurants, ice rinks and golf courses through a leasing agreement or royalties on sales. Concessions can increase the visitor rate and thereby parking fees.

In some cities, parking fees go to the city general fund and are then distributed, but not always to parks. Other park systems retain full control of parking revenues.

Funding park and recreation programs by revenue-generating activities decreases access to parks and programs for low-income residents. Equitable-access strategies include:

Free Park and Recreation Passes for members of households that qualify for TANF and SNAP benefits. Voluntary Fees are suggested donations for use. Those who can afford the donation contribute; those who cannot are not obligated. Scholarships are less effective, because few residents access them and volunteer programs in exchange free access can burden already-stressed families.

Programming Fees
Charging fees for usage of park programs—skating, golf, fitness centers, camps, concerts—is a common strategy for raising non-tax revenue.

Growth pays for growth, the saying goes, and these one-time fees are assessed on residential or commercial development to fund public infrastructure, including parks.

Zoning strategies allow a city to benefit from the real estate industry and use the funds for capital or maintenance projects. Two zoning strategies of interest include:

Incentives and bonuses: Offering developers and property owners zoning incentives to incorporate public amenities into their development plans or contribute to a special park endowment or public improvement fund.

Transfer of Development Rights: The Transfer of Development Rights (TDR) allows property owners to sell the development rights from their land for use on another. The original site is then protected as an open space under a conservation easement.

A park dedication fee uses a portion of land in any housing or commercial/industrial development project be dedicated to public parks, recreation facilities, playgrounds, etc. Alternatively, the developers may pay cash in lieu of a land, which is put in a special fund for park acquisition.

Maintenance and operations costs are often forgotten in tax levies and bond initiatives. By capitalizing maintenance costs, cities include those anticipated costs into the levy or bond proposal and set the funding aside in an endowment to cover future costs.

Tax Increment Financing Districts (TIF) collect property tax revenue within a designated geographic area and allocate it for a specific public improvement projects.

Based on the notion that well-maintained public spaces increase commerce, Business Improvement Districts are a form of public-private partnership that taxes businesses within a designated area and uses them for public improvements, often in downtown areas. Business Improvement Districts are a useful strategy for pooling revenue to support a common goal. BID funds are managed by a nonprofit corporation established by the district. BIDs are increasingly common in cities across the country, particularly for park maintenance.

A Green Benefit District, first created in San Francisco, is a public-private partnership property assessment district created by local property owners to fund neighborhood improvements. Revenue is used for parks, open spaces, the greening of streets and neighborhood beautification.