The department fared only slightly better than in 2002, but the revenue gain was minimal compared with cost-cutting efforts, recreation director Steve Rauwolf told board members April 1.

The department had anticipated $305,000 in net revenue for last year, but reported a significantly lower number. Revenue over expenses for the year was close to $70,000, up $4,000 from the year before.

But this small gain came only after the department made around $170,000 in cuts to its administrative budget.

The department has struggled for the past three years, often debating about the future of its programs and staff.

"We thought we had hit bottom with recession in 2002, but we didn't," Rauwolf said.

Enrollment in many of the recreation department programs, particularly those with a child-oriented focus such as after-school care, tends to fluctuate with the economy. Rauwolf attributes this phenomenon to a number of factors, including the amount of discretionary income parents have to spend on their children.

"To some parents it's a need and to others it's recreational, but both are affected by the recession," Rauwolf said.

The recreation department's closed pool facility at Los Gatos High School was another reason for limited growth last year. The department had to rent the pool at the Jewish Community Center for its aquatics program while the high school pool was being renovated, creating an additional expense.

The department is self-supporting, generating revenue from user fees. Neither the town of Los Gatos nor the city of Saratoga subsidizes the department.

"It's pretty amazing when you can do teen and community programming and break even," said Rauwolf. Such programs are typically subsidized by other organizations.

As saving measures, the department cut a number of administrative costs last year and plans to continue those reductions into this year. The department will also permanently close its preschool program in July.

Despite the dismal numbers from last year, there are signs that some of the department's programs are regaining popularity. Rauwolf said that enrollment in the department's winter camp doubled this year. Enrollment figures for the summer semester will not be known for another month.