The Hunden Strategic Partners report to the town on the proposed Crystal Lagoon project for Fountain Lake reflects a $9 million construction project that would cost $3 million per year to operate with deficits projected to begin in year five of operations.

It was October when the council determined it would no longer pursue the project. However, the Hunden study, which was already underway, was allowed to conclude. The 47-page report was posted to the town website in December.

Hunden estimated the cost to develop the project at approximately $9 million. That includes $750,000 per acre for Crystal Lagoon to build the 3.8-acre water feature, totaling $2,850,000.

The 1.75-acre sandy beach is another $300,000. A boardwalk plaza is $309,000 with the perimeter fence estimated at $185,000.

The pavilion had a $975,000 price tag with another $250,000 for the boathouse.

Additional “soft” costs are estimated at $1,948,000 while furniture, fixtures and equipment (including park reconstruction and reconfiguration) would cost another $1 million.

Hunden projects that over the first four years attendance would average a little less than 300,000 visitors with year two being the peak at 340,544 visitors.

However, in years five through 10 attendance is expected to drop to between 200,000 and 215,000. The report states that the park would need to attract 250,000 visits a year to be a financial success. Years five through 10 would have operating deficits averaging $270,000.

The report does suggest that in year two, the estimated peak year, the facility would generate $1.5 million over and above operating expenses.

It would require 11 full-time employees with projected annual salaries totaling $445,000 to operate and maintain the lagoon. These would include management, marketing, programming and operations staff.

It would take another 40 to 60 part-time employees to run the site, with that figure bumping up to 62 in years two and three due to expected attendance. Estimates drops to 40 part-time workers at the end of the first 10 years.

The part-time salaries would max at $565,629 in year three. Year 10 would fall to $340,385.

Part-time employees include lifeguards, gate attendants, concessionaires, maintenance, rental attendants and program and service staff.

After a Town Council work session was held to discuss the lagoon proposal in June, Town Manager Grady Miller believed there was a consensus of the council to move forward with a contract with Hunden Associates and Applied Economics to identify the construction costs as well as operating and maintenance costs of the proposed lagoon.

Based on the projected revenues and expenditures of operating the proposed lagoon, the firm was tasked in determining if the project was financially feasible.

The cost of the Hunden Associates portion of the feasibility study was $18,800.

Hunden and Associates worked closely with Swaback Partners and Crystal Lagoons to identify the costs that were critical in assessing the feasibility of the project. Swaback Partners was tasked in optimizing the lagoon layout in Fountain Park and to identify the programming needs and cost of buildings for the lagoon.

Swaback was compensated $20,000 for its portion of the feasibility study.

At a regular council meeting on Oct. 10, the mayor and council determined that the town would no longer pursue the project. Despite stating the project would not move forward, the council indicated that the feasibility study report would be made available to the residents and general public.