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City's costs increase with new pool contract

Original post made on Jul 5, 2018

Ever wonder why there are so many activities and kids at the Burgess Park pool, especially in the summer? Turns out that for many years, Menlo Park's private pool operator, Team Sheeper Inc., has been fighting a battle to turn a profit in the notoriously non-lucrative business of aquatics.

Read the full story here Web Link posted Thursday, July 5, 2018, 9:51 AM

Comments (23)

22 people like this
Posted by Jane Gill
a resident of Menlo Park: Downtown
on Jul 5, 2018 at 11:42 am


Tim Sheeper and his Menlo Sport Team are important assets to the City of Menlo Park. They provide a wide breadth of aquatics to the local community. These include: Masters swimming, lessons, swim camps, water aerobics, lap swimming, underwater hockey, and age-group swimming. He and his team should be applauded.

One possible solution for alleviating the current fiscal problems: make the SOLO swim team pay the current market rate for lane rentals.


12 people like this
Posted by Sheeper business?
a resident of Menlo Park: Linfield Oaks
on Jul 5, 2018 at 12:27 pm

Has the city reviewed the books of Sheepers businesses? A substantial number of the pool hours are not open to the general public when various Sheeper businesses and contractors have access for their own programs. All financial reports need sunshine so the arrangement can be properly assessed.


12 people like this
Posted by SandyB
a resident of Menlo Park: Downtown
on Jul 5, 2018 at 12:46 pm

SandyB is a registered user.

From the Swim School, the swim teams, Masters, Aquafit Fit and Wellness in addition to open swim and lap swim, the city of Menlo Park has been blessed for a number of years with programs that range from infants to seniors. Not only are athletic services offered, a profound sense of community has developed around these programs. Qualified staff and continued maintenance do cost money. My vote is that the programs offered are worth every penny spent.


23 people like this
Posted by Home owner
a resident of Menlo Park: Linfield Oaks
on Jul 5, 2018 at 1:21 pm

The old pool was a community resource for families. This was consistent with what many of us grew up with, and we were promised that this would not change substantially, but many of us knew better.

The new pool under Sheeper has been from the very beginning a more exclusive place for serious swimmers.

As a local property owner, I never liked subsidizing this. People who want a training and competition pool for their clubs should pay the freight.

Subsidizing this kind of club is not part of the social contract as far as I am concerned. Our community and country need to take a serious look at that contract and where it has gone wrong.


28 people like this
Posted by swimmer
a resident of Menlo Park: Central Menlo Park
on Jul 5, 2018 at 1:50 pm

Here's what the article is overlooking. Sheeper's most popular program is his masters swim. Those swimmers,who include some of the wealthiest and most politically-connected people in the mid-peninsula, are devoted to him. That's why he was given the pool rent-free in 2006.By all accounts, he is a nice guy and inspiring coach.

But apparently he's not so great at managing a business

So now, in addition to giving him the pool, which we taxpayers are still paying for, we will be covering his expenses, while he keeps most of the profits from running his private club -- let's not pretend it serves the general public as community access is limited -- on public property

Corruption is alive and well in Menlo Park.


34 people like this
Posted by local family
a resident of Menlo Park: Linfield Oaks
on Jul 5, 2018 at 2:30 pm

Burgess is about a 5 minute walk from our house. We have two young children who love swimming and we never go because the hours for free swim are so limited and erratic. From a young family standpoint, Burgess pool is not a community resource. If we swam masters or took lessons perhaps we would feel differently, but to us it seems like a private pool run for profit.


12 people like this
Posted by life is in the details
a resident of Menlo Park: Central Menlo Park
on Jul 5, 2018 at 2:38 pm

@swimmer

you should REALLY read the article carefully before commenting (details make a difference).

I was around when the 2006 contract was negotiated, and the city could NOT run the programs. their hiring and management were inadequate (and required union workers at a higher cost). Tim paid rent and the maintenance and the pool has flourished. And more importantly allowed MPK to actually open the pools.

at the first renewal they required him to run the Belle Haven pool too. A financial sink hole of major league proportions. as the maintenance increased his options were to reduce the cost of doing the "extras" for the community (Belle Haven, etc.) or find a new shared formula with MPK. The article is quite clear that operating pools is a financial sink hole {"That's because they were hemorrhaging," Schweigart said.}. The city acknowledges that if they took over operating the pools again they could NOT provide the level of programs and hours that are currently offered.

Sound like the City agrees with the issues, so politics notwithstanding it's a business that our community can't operate via it's city government and the private sector can do better and cheaper......sounds great to me.


22 people like this
Posted by Home owner
a resident of Menlo Park: Linfield Oaks
on Jul 5, 2018 at 4:08 pm

@life is in the details

The original agreement did not require Sheeper to pay any rent. The second agreement in 2011 had a fig leaf amount of rent, $3000 per month. With the third agreement we, the ever generous tax payer are throwing in maintenance cost as well.

The new pool was created for and has benefited a small, wealthy minority / special interest.

This is a model of what is wrong with our society, and a line item on my property tax.

This kind of small abuse, one piled on the next, is what undermines the foundation of trust in our government and society.

Eventually we end up paying ten times the median wage in this country to construct a single bathroom in a park and an unfathomable $200 million to do a single grade separation.


7 people like this
Posted by Menlo Voter.
a resident of Menlo Park: other
on Jul 5, 2018 at 6:59 pm

Menlo Voter. is a registered user.

"Eventually we end up paying ten times the median wage in this country to construct a single bathroom in a park and an unfathomable $200 million to do a single grade separation."

Thank the California legislature for this stupidity. It's called "prevailing wage". All public works projects MUST pay "prevailing wage". Prevailing wage is the local union wage including benefits. Generally at least two to three times the ACTUAL prevailing wage. If it wasn't for labor unions control of OUR elected representatives we wouldn't be paying stupid costs for public works projects. So, if you want to stop paying these kinds of ridiculous costs for public works projects, get on your elected representatives and more than that, insist on getting money out of politics so the unions can't buy your representatives.


29 people like this
Posted by Priced out
a resident of Menlo Park: other
on Jul 5, 2018 at 10:16 pm

I'd love to have an external auditor look at the books from both parties before the pool is again tucked away for another 5 years by simply using scare tactics.

It's my tax money, and I think I deserve to see how much of it ends up in private pockets (or subsidizes exclusive services such as Triathlon or Adult Swim Clubs that do only benefit a tiny wealthy fraction of MP).


31 people like this
Posted by looking on
a resident of Menlo Park: Downtown
on Jul 5, 2018 at 10:44 pm

From the beginning Sheeper was given a sweetheart deal. The Pool is an $8 million facility and the current rent he pays is big joke. Now Sheeper doesn't even want to pay that.

THIS IS A HUGE SCANDAL!!

The quoted statement:

"From a business standpoint, it doesn't make sense to keep (pools) open," said Menlo Park Community Services Director Derek Schweigart. "It's an expensive operation. This is why you don't see private operations building pools."

makes me wonder if Schweigart is working for Sheeper or for the City.

Absolutely a full audit, including personal tax returns of Sheeper and his organizations need to be audited. No council member nor the City Manager should approve this until this has all been investigated.

Best would be to put out for bid to other organizations and see what kind of bid for this facility would be forthcoming.




12 people like this
Posted by Common Sense
a resident of Menlo Park: Linfield Oaks
on Jul 6, 2018 at 7:56 am

It's a city amenity and one that will never turna profit. Do you see many private pools being developed? No? That's for a reason. It sounds like this guy does a great job operating the pool and mitigating city costs... But there will always be costs. Keep this guy in business with a fair profit and accept a city line item much smaller than it would be if the city operated the pool itself.


11 people like this
Posted by Pot Meet Kettle
a resident of Menlo Park: The Willows
on Jul 6, 2018 at 10:03 am

Thank you Common Sense for living up to your name.

We all seem to accept the basic premise that having a community pools open to the general public is a good thing.

However, everyone is trying to analyze the Sheeper contract in terms of how much money the City profits (or loses). This misses the point. The better question is how much would it cost the City to run a similar operation with its own employees (coaches, lifeguards, swim instructors, front desk staff), and whether the Sheeper contract provides a better value for the City and the pool using community.

To the latter question, I think the Sheeper deal is quite good when you compare the pool's operating hours, swim lesson offerings, and specialty programs (masters swim, triathlon, camps, etc.) to those in neighboring communities.


21 people like this
Posted by Sheeper business?
a resident of Menlo Park: Linfield Oaks
on Jul 6, 2018 at 10:17 am

@ Common sense “keep this guy in business with a fair profit and accept a city line item ..”

Without an audit of all books, no one can assess what a fair profit is or even whether the city is paying less for desired services and pool availability.
I believe the analysis years ago of city-run costs did not include lane rental revenue from private programs such as Sheeper’s numerous entities.
Note that the current arrangement not only is for services of a private operator of the pool, possibly less expensively than the city could do, it also is for free use of the pool for big chunks of time by a number of for-profit businesses.

Please also note that as our community grows, there will be more people wanting to use the pool. But its public use hours are very limited.
It is appropriate to reasaess current and future community needs and compare public availability with other public pools, along with a thorough financial assessment.


14 people like this
Posted by Lynne Bramlett
a resident of Menlo Park: Central Menlo Park
on Jul 6, 2018 at 10:41 am

Lynne Bramlett is a registered user.

The comments illustrate valid concerns regarding the aquatics program at Burgess Park. They also raise questions regarding who MP's recreational programs should serve. The Burgess Pool is not the only city owned facility where the operations have been outsourced. The concerns illustrate the need for MP to develop a long-term (20+ years) strategic plan based on residents values, vision and key priorities for Menlo Park. We have no such plan and its lack contributes to our too reactive style of local government, along with late night council meetings because Council lacks a resident-based framework for decision-making. Regarding the pool, concerned residents can write the P&R Commission and staff Web Link to request a performance audit of MP's aquatics programs. I could find no evidence that any have been conducted. like in these examples audits:Web Link and Web Link The Community Services budget represents a significant portion of MP's overall budget. It's reasonable to expect periodic performance audits of major MP departments. Unfortunately, MP seems to lack an internal auditor. Council recently agreed to the City Manager's budget document which added 9.25 city staff. Web Link However, I don't think an internal auditor was among the group. The Community Services Department is embarking on a major effort Web Link related to updating our major P&R related facilties.
Residents can also get involved in this process. For any concerns, it's also helpful to write the entire city council, and management staff via city.council@menlopark.org Reporters and other residents read those emails and collectively, they can contribute to transparency, accountability and oversight in MP.


15 people like this
Posted by Lynne Bramlett
a resident of Menlo Park: Central Menlo Park
on Jul 6, 2018 at 11:21 am

Lynne Bramlett is a registered user.

When I posted (above), I had forgotten about the Community Services Operational review Web Link= A review is different from a financial or performance audit. Seems like the right time for a performance audit of MP's aquatic programs and facilities.


16 people like this
Posted by Audit
a resident of Menlo Park: Menlo Oaks
on Jul 6, 2018 at 11:33 am

By giving Sheeper a steal on the Burgess Pool, we are also in effect subsidizing his other ventures.


This should be a public audit or leave decision


10 people like this
Posted by C'mon
a resident of Menlo Park: Central Menlo Park
on Jul 6, 2018 at 5:18 pm

I used to swim in the masters program and also access, solo and with kids, a variety of the aquatics programs. This city is lucky to have Tim Sheeper running this pool facility. the programs run far and wide, across all skill levels, and the facility is run effectively. Sheeper is also very civic minded and very dedicated to the facility and the community. Take a look at other public facilities and you will see the difference. Fiscal prudence is important, of course, but dont take for granted the quality of the operation we have here.


20 people like this
Posted by Mom user of Burgess Pool
a resident of Menlo Park: other
on Jul 7, 2018 at 11:24 am

If running pool swim lessons is such an unprofitable venture, why did Mr. Sheeper take on running the same exact program for Palo Alto? The issues of staffing being harder and costlier to recruit in this expensive area and traffic making it difficult for parents to take children to lessons cannot be dramatically different between the two pools as they are a mere 2.2 miles away from each other.

The article states: "Things took on a new urgency last summer, Schweigart said, when Team Sheeper saw a decline of 16 to 20 percent in swim school enrollment – a significant hit for a business with already narrow margins. Schweigart theorized that the enrollment could have shrunk because of fewer kids, because of lowered enrollment in local schools, and because increased traffic makes makes taking kids to activities more time-consuming"

The timing of this "significant hit" coincides with Mr. Sheeper taking over running the Palo Alto (Rinconada) swim lesson programs which was covered by the San Jose Mercury News (Web Link). Although swim lesson prices increased dramatically under Mr. Sheeper's new Palo Alto Swim and Sport program, a price for a private lesson there is still a little less expensive for a non-resident (which makes a difference for many young families). Moreover, there may have been some start-up time and effort at Riconada Pool that diverted time and attention from Menlo Park's swim programs given the timing of the "significant hit".

Private partnerships can be very effective in providing service to the public and savings to the residents/ city. The trouble comes with the implementation. By skipping an RFP process and becoming completely reliant on one provider, the city seems to have found itself with little to no bargaining power during negotiations. Based on my read of the article, the taxpayers are coming out the losers here yet again. Team Sheeper would have to have an extra one million in revenue for revenue sharing to kick and and the city to even begin to recoup the $336,000 the city now pays annually to keep the lights on and the chlorine flowing.

Despite community members begging for years for transparency, there has never been a public review or financial audit Lynne Bramlett and other commenters mention. Given that the taxpayers are paying the 38 million in Measure T bonds, $336,000 annually for chemicals, utilities, etc., and are on the hook for all major capital expenses, it seems that transparency on revenue would be the right thing to do.

Lastly, it appears that Team Sheeper is diversifying-- perhaps Menlo Park should too. My children swim for Menlo and I like their program. But if the city cannot reach an agreement that is fair to the taxpayers, there are other private partners. King's Academy now runs the swim schools for Redwood City, San Carlos and San Mateo and earns Yelp reviews of 4.5 out of 5 stars -- higher than Menlo Swim and Sport's 3.5.


5 people like this
Posted by Historic Perspective
a resident of Menlo Park: other
on Jul 8, 2018 at 9:33 am

City Councils decide how a municipality chooses to operate and fund its public works. It is a public policy choice. Whatever you think of Sheeper’s operation, there is an unescapable fact: The elected representatives on the Menlo Park City Council authorized the agreement. The assertions that Sheeper is somehow violating the public trust for seeking a profitable arrangement is ludicrous. He is a provider of services and apparently a good one, given his recent expansion into Palo Alto. His is a private sector concern, entitled to be profitable.

Municipal governments often offer pools to their communities. The history of this practice is well documented in this academic paper: Web Link Cities started offering pools in the 1920s, a local example of which was the Fleishhacker Pool in San Francisco. The original Burgess pool was built in 1943 as part of the Army’s Dibble General Hospital. It was rebuilt in 2005 at a cost of approximately $6 million, just in time for the 2008 recession which saw many municipalities close pools to conserve funds. (In acknowledgement of the article’s thesis, to this day the Belle Haven pool is closed more often than it is open.)

Faced with the possibility of shuttering its new pool, Menlo Park looked for ways to keep it open at reduced cost and accepted Sheeper’s offer to run it. It was a win-win, as Sheeper needed a facility for his swimming club and the City saved money by outsourcing. Thus, the new pool remained open and accessible for all.

Sheeper brought private sector competition inspired services to a public facility. The additional service offerings included a bubble covering a pool during the winter, allowing year-round lessons. Many critics decried the creation of a club environment at the public pool, with for profit activities crowding out public access at desirable times. Indeed, Sheeper’s clubs crowded out other clubs (competitors) which had traditionally rented space from the City.

Though there are some allegations of an opaque selection process, the debate over this contract seems largely to center on whether the government betrayed its citizens by outsourcing its new $6 million pool to a private concern which favored profitable club activities over public access. In short, did the taxpayers pay for the pool and lose access and the ability to recover costs through fees?

Governments spend more to operate public pools than they could possibly hope to recover through use fees. Public facilities are subsidized, and cost recovery is partial. The use fee is meant to control over consumption of a scarce resource, not to break even or profit from the citizens. Sheeper’s public access fees are competitive with other government operated pools and his club sports and lessons are likely the source of much of the revenue which made the agreement pencil out.

Or, it did pencil out until labor became scarce in a full employment economy. Sheeper now faces the double barrel challenge of increased labor costs and repairs to 10+ year old pool equipment which requires increased maintenance and replacement. It is the City’s asset, why should the operator incur the cost of depreciated parts at the end of their useful life? If the contract ends, does Sheeper get to remove the parts he paid for and take them with him??

Going forward, the City certainly has a choice in whether to pay more and renew Sheeper’s agreement. The challenge before the Council is whether they can offer the same or better services for less than what Sheeper requests. Or, can they find another operator willing to provide the same or better services for less?

A public-private sector partnership with Sheeper is likely the best bet to continue providing excellent services to the community. Sheeper has a solid understanding of the costs and his justification for increased compensation is well founded. Should the City choose to try to take it in house, it will be at a disadvantage out of the gate, given the high cost of CalPERS entitled public servants in addition to the maintenance costs of the pool.


21 people like this
Posted by Lynne Bramlett
a resident of Menlo Park: Central Menlo Park
on Jul 8, 2018 at 12:24 pm

Lynne Bramlett is a registered user.

Mom User makes a number of excellent points as do other posters. A performance audit would provide “the City Council, City management, and the public with independent and objective information regarding the economy, efficiency, and effectiveness of the city's” aquatics program. Conducting a performance audit would confirm the benefit(s) of the current outsourcing arrangements or provide fact-based reasons for a change. Requesting one would be taking a business-like approach to the matter with precedent in other cities, so Team Sheeper should not take the idea personally.

Our Finance Department website includes no mention of performing internal audits. Web Link The Finance and Audit Committee also meets infrequently. Despite their name, the Committee’s stated role includes NO mention of performing audits. Web Link

MP lacks an internal auditor, such as the one that Palo Alto voters put into place in their city via a 1983 amendment to their charter. The language in quotes above came directly from the City of Palo Alto’s website Web Link to describe the role of their City auditor’s office. An internal auditor would deliver more financial transparency, oversight and accountability and help to bring about a more resident-centric local government in MP.

For now, I suggest that those concerned write the Finance and Audit Committee and also the Parks and Recreation Commissioners Web Link, with a CC to the staff liaisons and Council at www.city.council@menlopark.org. When one uses the city council email, it establishes a public record of the request. Our local commissions are supposed to be advisory to Council, so starting with them supports what should be their role in our local government.


6 people like this
Posted by Sheeper business?
a resident of Menlo Park: Linfield Oaks
on Jul 10, 2018 at 3:33 pm

The city needs to evaluate what it wants and needs by unbundling the pool operation management from the oversight of programs, seeking separate bids for each role.

I assume that the pool is a desirable place for a variety of programs and that the city could either hire an (one) employee or a contractor to oversee programs that are provided by nonprofit and for profit organizations that rent pool time. This would put the city in the driver seat about what is provided and when. Programs would be charged fairly and transparently for use of the pool. The city might not make money but it would be in charge of the pool on behalf of our community and the taxpayers who are paying for the facility. Instead, now a for-profit operator has so much leeway running the pool that he makes all Program decisions, including ones that benefit his own pockets, limit public access, and exclude other programs that compete with his own. Too cozy and opaque.


8 people like this
Posted by Others
a resident of Menlo Park: other
on Jul 10, 2018 at 5:17 pm

There are others that would be willing to fill in the gaps in Tim's programming. There is SOLO, PASA or some water polo clubs that could rent space for their programs. Tim has insisted on keeping most of the pool for HIS team. It really isn't a public pool, Team Sheeper comes first and the public comes second. It has been this way for years. I'm advocating for the city to run the pool, but Team Sheeper's use should be limited, especially if there are others that can help keep the pool funded.


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