The Oak Ridge city staff stepped up to do an amazing job of estimating costs associated with the Secret City Festival of 2009. Apparently no one had previously asked for an accounting of the true cost to the city before the current council. Reconstructing the hours spent and equipment and materials used was no easy feat. I admire staff’s ability to reconstruct these estimates.
Unhappily, when the cost figures were presented, one piece that got published suggested that the festival made a profit of $18,613. This figure was based on a previous habit of reporting on the festival as a separate entity. Unlike many events in Oak Ridge to which the city contributes with manpower and materials, the Secret City Festival is planned and presented as a creation of the city and product of city underwriting. According to Parks and Recreation Director Josh Collins, the $173,515 cost reported by the festival committee did NOT include the $117,521 in city staff time and materials reported to council by Gary Cinder. The Festival’s separate-entity accounting DID include as income the $50,000 from the city of Oak Ridge as sponsor plus $10,714 the city paid for banners.
According to the figures above given to council, the 2009 Secret City Festival cost the city an estimated $291,036. The total income from vendor fees, ticket sales, merchandise sales, and sponsor donations (not including the city as a sponsor) was $131,415. That makes the bottom line to the city a net cost of almost $160,000.
The numbers are neither good nor bad in themselves. It may be perfectly reasonable for the city to throw a party that costs $160,000. What isn’t reasonable is for us to tell ourselves that it made a profit. If we are to collectively make good decisions about what to fund in the city budget, we need to provide good data with which to make them. When we know the real monetary commitment involved, we all can then look at the benefits to the city and draw more reasonable conclusions.
The festival is enjoyed and looked forward to by many citizens of Oak Ridge and surrounding areas. Publicity from the festival not only attracts people from other areas to the event. It also shows us in regional and national publications as being a place where fun events do happen. It offers a venue for lots of us to come together and for organizations to present a view of their local missions and involvements. It is an opportunity for many citizens to volunteer for a community cause. I would love to hear from individuals and organizations about the festival’s value to them.
This is not intended as commentary on the Secret City Festival itself. My purpose is to encourage citizens, their council, and their city workers to think in terms of real costs for our endeavors so that we can have intelligent discussions about their value to us. We need to be able to measure Return On Investment in both concrete and quality of life, intangible terms. Cost accounting is not a new idea. It is an old and reliable tool. We have adept accounting people on city staff. As a result of exploring the cost of the SCF, employees who already allocate their time by projects now break out the time and materials committed to various additional social and promotional events.
I am interested in hearing from you about any city issues. Our collective ideas are our greatest asset.