SYCAMORE – Efforts to improve the Sycamore Park District’s financial health are paying off.
The Sycamore Park District had its bond rating upgraded to A from A-minus by Standard & Poor’s, a credit rating agency that determines the ability of corporate, state or city governments to meet their financial obligations.
The rating agency found that the park district has a “strong capacity” to meet financial commitments but may be “susceptible to adverse economic conditions and changes in circumstances.”
Ted Strack, Sycamore Park District Board president, said the rating upgrade means bonds the park district issues in the future will have lower interest rates, saving taxpayers money. But the biggest benefit for him is that the rating shows the park district is financially healthy.
“It’s in a good position financially and a lot of credit goes to [park district Executive Director] Dan Gibble and his staff for achieving that,” Strack said.
Gibble said the annual operating budget for the park district this year is more than $2.5 million, slightly less than the year before.
The park district budget had included fund deficits for years, particularly in its golf course fund. The Sycamore Golf Club had accumulated more than $330,000 in debt by the end of 2012, some of which was covered by excess revenue from other recreation funds. However, reorganization including staff cuts and higher user fees at the golf course has helped to bring the issue under control.
Two full-time positions were eliminated to save money. Gibble said the golf course superintendent and superintendent of parks positions were combined, while one of two Professional Golfers Association positions were eliminated. He said this saved $150,000.
This year’s budget projects that the golf course will be in the black for the first time in five years.
Strack said every year the park district typically borrows $500,000 for capital projects. Those funds are borrowed at the beginning of the year and paid back by year’s end.
With the improved credit rating, the district should get lower interest rates on those bonds. About $150,000 of that bond is used to pay for a maintenance facility and various park improvements, he said.
The next goal is to grow the park district’s fund reserves, which have shrunk to 7 percent of its annual operating expenses. A common benchmark for government units is having their fund reserves at 50 percent of their budget, Gibble said.
“We’re striving to get 25 percent by the end of next year,” he said.