Kids Factory FAQ

Frequently Asked Questions

What is Kids Factory?

Kids Factory is a drop-in after school program offering crafts, games, sports, special event days, and other recreational activities. It is not designed as a child-care program. Kids Factory had been funded by the City of Lake Forest and run by Saddleback Valley Unified School District (SVUSD) Community Services staff. 

Kids Factory, designed for children entering grades K-6, operated until 4 p.m. on school days. The program pre-dated the City’s incorporation, when SVUSD offered a variety of recreation programs.

What role did Saddleback Valley Unified play in the program?

Saddleback Valley Unified acted as a contractor for the City. The District hosted the programs at its campuses and coordinated program registration. The City paid all costs, including staffing, site cell phones, trainings, supplies, mileage, and administrative fees. 

How many Lake Forest children participated in Kids Factory last year?

In 2019-2020 school year, 1,088 students participated in Kids Factory on eight SVUSD elementary school campuses in Lake Forest. 

How much did the program cost participants? 

Participants paid $100 for the year in 2019-20, which was raised from $50 annually the previous year. Before 2018-19, participants paid $25 annually.

How much would the City pay Saddleback Valley Unified for the Kids Factory? 

SVUSD estimated the FY 2020-21 Kids Factory program would cost $485,977. The City’s Comprehensive Fee Study, created in 2019 with 2017-2018 data, determined the cost recovery for Kids Factory was just 11 percent.

What alternatives were considered?

Going into the Fiscal Year 2020-21 Budget process, two scenarios for Kids Factory funding were developed:

• Increasing participation fees to $400 annually, which was projected to reduce the City’s net cost to $84,500 annually, assuming the same number of participants
• Increasing participation fees to $600 annually, which was projected to reduce the City’s net cost to $4,500 annually, with the likelihood of fewer participants.

Why was the program de-funded in the 2020-21 budget? 

Prior to the pandemic, the City projected expenditures would outpace revenues within the next two years. Essentially, the City was providing some programs and services that it could no longer afford. When considering potential reductions, staff relied on three Budgeting Principles:

• Is it a service only the City provides?
• Is it something only the City can pay for?
• If the City incorporated today, would it prioritize this program?

In the case of Kids Factory, staff determined other options exist for after-school recreation and that the heavily subsidized program would not be prioritized if the City incorporated today in light of all of the services the City is legally responsible to provide.  As staff developed a plan to phase out programs over the next three years, the Pandemic hit. The impact of the Pandemic on City revenues required reducing costs sooner than anticipated. Staff expects a revenue reduction of at least 10 percent in Fiscal Year 2020-21 because of the Coronavirus Pandemic and further revenue reductions in the next fiscal year. 

Why does the City have financial reserves? 

The City’s reserves provide protection against unexpected interruptions in revenues, State actions, adverse economic conditions, unpredictable one-time costs such as lawsuits, and exposure to natural disasters and emergencies. The City’s reserves are designed to hedge against the risks that cannot be mitigated by insurance. A four fifths (4/5) vote of the entire City Council is required for any appropriation and expenditure of funds from the reserves.

Why were reserves not used to pay to continue Kids Factory? 

 A baseline principal for City finances is that ongoing costs, like Kids Factory, should be paid by ongoing revenues, such as the sales and property taxes that make up the General Fund.  The City’s Fiscal Year 2020-21 budget includes spending $500,000 in reserves on critical items, such as public safety and infrastructure. Staff anticipates spending more reserves if City revenue continues to decline because of the Coronavirus Pandemic. 

What are other options for parents who need after-school care?

• The Learning Connection (TLC) is an accredited after-school program available with SVUSD. The program is $332 a month for five days a week, from dismissal to 6 p.m.  Attending three days a week is $265 a month.
• The City Council in 2019-20 approved a pilot program with The Boys and Girls Club to provide an after-school, pop-up club at El Toro Park. If renewed by the City Council, that program can accommodate the same age group. The Club’s initial proposal received significant support from Lake Forest parents. Staff anticipates bringing the Boys and Girls Club to Council on July 21.
• Tutor Time, the YMCA, Daycare Lake Forest, and several other private organizations/individuals in the City also provide after-school daycare programs.

What other support does the City provide to youth programs?

Overall, the Community Services’ Fiscal Year 2020-21 Budget is more than $2.5 million. Some highlights include:

• $505,900 for Skatepark staffing, maintenance, and events.
• $88,000 for Teen programs, classes, and youth sports at the Sports Park & Rec Center (not including staff costs).
• $84,500 for Community programs and special events (not including staff costs).

What other support does the City provide Saddleback Valley Unified School District?

The City’s Fiscal Year 2020-21 Budget includes the following services that are funded by many school districts throughout the state and other financial support for SVUSD programs:

• $363,000 – Crossing guard services
• $286,000 – School Resource Officer (SRO)
• $    3,500 – Grad Night donations
• $    1,000 – Donation to El Toro High School band for July 4 parade participation

How does the City support recreation for the community at large? 

The Fiscal Year 2020-21 Budget identifies more than $3.7 million for park maintenance and repairs, including:

• $1.4 million for park maintenance and amenities
• $2.3 million for maintenance of sports fields throughout the City