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HomeMy WebLinkAboutFIN-20-066 - 2021 Operating BudgetO - 1 O - 2 O - 3 O - 4 O - 5 O - 6 O - 7 O - 8 O - 9 O - 10 O - 11 O - 12 O - 13 O - 14 O - 15 O - 16 O - 17 18 - O 19 - O 20 - O 21 - O 22 - O 23 - O 24 - O 25 - O 26 - O 27 - O 28 - O 29 - O 30 - O 31 - O 32 - O 33 - O 34 - O 35 - O 36 - O 37 - O 38 - O 39 - O 40 - O 41 - O 42 - O 43 - O 44 - O 45 - O 46 - O 47 - O O - 48 O - 49 50 - O 51 - O 52 - O O - 53 54 - O 55 - O 56 - O 57 - O 58 - O 59 - O 60 - O 61 - O 62 - O 63 - O 64 - O 65 - O 66 - O 67 - O O - 68 O - 69 70 - O 71 - O 72 - O CITY OF KITCHENER ENTERPRISE OVERVIEW Building Enterprise Operating Model/Philosophy: The Building enterprise is responsible for the administration and enforcement of the Building Code Act and Building Code. The mandate of the Building enterprise is to ensure construction within the City meets the minimum requirements as prescribed in the Building Code. Services Provided: The Building enterprise provides a majority of its services to external customers for building permit issuance and on-site inspections. Building also supports the AMANDA software system and administers the final grading approvals for new low-rise residential buildings. Benchmarking: The charts below outline the total number of building permits issued and fees collected over the past 6 years. Total Building Permits Issued 2015-2020 2,732 3,000 2,483 2,328 2,500 2,140 2,052 2,000 1,500 905 1,000 279 269 258 234 227 219215 500214 194 193 8380 - 20152016201720182019*2020 Industrial/CommercialInstitutionalResidential Total Building Fee Revenues 2015-2020 $5,961 $6,000 $4,942 $5,000 $3,708 $4,000 $2,877 $3,000 $2,089 $1,499 $2,000 $1,081 $1,012 $864 $814 $650 $571 $532 $1,000 $424 $381 $357 $337 $159 $- 20152016201720182019*2020 Industrial/CommercialInstitutionalResidential * 2020 – Year-To-Date (YTD) January 1st to June 30th O - 73 CITY OF KITCHENER ENTERPRISE OVERVIEW Primary Legislation: The Building enterprise is governed by the Provincial Building Code including referenced legislation such as the Planning Act, Development Charges Act, and other construction standards. The main purpose of the Building Code is to ensure the buildings citizens live, work and play are safe through the issuance of building permits and site inspections. Building permit revenues must only be used for the administration and enforcement of the Building Code. Customer Base: The majority of Building’s customers are the private sector, and their experience in building regulations is diverse; from minimal to knowledgeable. Customers of Building include single time users such as do-it-yourself homeowners, repeat homebuilders, and non-residential applicants who build 1-2 times per year. The 2020Year-To-Date (Jan. 1 – June30) breakdown of Building’s customer base is 85% residential, 13% industrial/commercial and 2% institutional. Recent Challenges: Despite the COVID-19 pandemic, permit activity YTD remained very active, especially for new residential buildings including the balance of construction for the downtown projects and miscellaneous project types. Staff working from home created some inefficiencies such as reviewing electronic plans on smaller size monitors and systems that would often freeze and required a reboot. The pandemic timing did not allow any summer students to assist in processing applications, and with staff working from home at the same time as high levels of permit activity, an increase in complaints on permit issuance resulted. The pandemic caused the Province to issue an Emergency Order (EO) for essential services and multiple amendments. The EO permitted certain residential & industrial and health care projects to proceed. Management invested a significant amount of time and effort into understanding the implications, revising processes and most importantly communicating the changes to customers. Customers appreciated the industry updates, and in some cases, challenged staff because they believed they were an essential service. This resulted in additional amount of staff time to further explain the amendments at all hours of the day. In early March, the public portal supporting online permit applications needed to be shut-down due to software issues. During the online permit shut-down, new temporary processes were established and communicated to the industry. The internal process changes caused additional work duties for staff, and fortunately the public portal resumedin July. Recent Successes: A number of technology improvements were completed in 2020, namely: The Public Portal returned to operation in July, after significant effort to ensure the software was working properly In June a major upgrade was completedto the City’s building permit software system (AMANDA) The Interactive Voice Recording (IVR) system, which allows customers to book inspections via their phone, wasupgraded O - 74 CITY OF KITCHENER ENTERPRISE OVERVIEW Staff were quick to adapt in making the transition smooth to working from home, utilizing virtual meetings for peers and customers. During the pandemic, Building supported prompt customer service through seven Industry Updates highlighting the regulation changes and City processes. The Building enterprise administered the termite pilot project again. Lastly, through ongoing and prudentfinancial measuresincluding continued high level of permit activity, the Building Stabilization Reserve remains positive and sustainable over the 5-year projection period. O - 75 76 - O 77 - O O - 78 O - 79 CITY OF KITCHENER ENTERPRISE OVERVIEW GolfEnterprise Operating Model/Philosophy: Kitchener Golf provides an affordable golf experience for all. Services Provided: Kitchener Golf operates golf propertiesandfacilities at both Doon Valley and Rockway Golf Courses offering affordable recreational golf opportunities, as well as facilitated camps and clinics, leagues, tournament and events. Kitchener Golf facilities are open from dawn to dusk seven days a week during the golf season, which can run anytime between April-November dependent upon weather. During the off season, the facilities can be utilized for special occasions and provide a publicspace for winter walking, snow shoeing and cross-country skiing. Rockway Golf Course has become the home to the Nordic Ski Club. Benchmarking: The chart below outlines the 2020 prices at a number of privately-owned public golf courses in the area. Kitchener Golf’s prices are at the low end of the spectrum. Kitchener Merry Hill Cambridge Puslinch Elmira Primetime$49$40 $60 $54 $54 Off-Peak $38.75 $38 $50 $50 Primary Legislation: A Level Playing Field agreement signed with National Golf Course Owners Association states that municipal golf courses will pay a dividend to their municipality equal to the sum of property and income taxes. This ensures that municipal golf courses are not at an unfair advantage. Customer Base: Both courses are open to everyone. Recent Challenges: Operating and meeting the challenges of COVID-19; aging infrastructure of clubhouses, golf carts, maintenance and storage building; and planning for the impacts of the MTO Highway 401 expansion project near the Doon golf course. Recent Successes: The Nordic Ski Club successfully completed their first season at Rockway Golf Club. The ski trails were well liked and adopted quickly by the neighbors with interest in the ski club. The Nordic Ski Club was awarded a provincial grant to assist with new equipment and some of the costs related to the move to Rockway Golf Course. Staff and golfers also adapted to the new physical distancing requirements. O - 80 81 - O 82 - O CITY OF KITCHENER ENTERPRISE OVERVIEW Parking Enterprise Operating Model/Philosophy: The Parking Enterprise’s goal is a self- funded, financially sustainable enterprise providing accessible and convenient parking in the downtown core at a fair price. It is very important to the core as it helps the City achieve and balance its economic development growth management and transportation objectives. Services Provided: The Parking Enterprise manages and operates the City’s downtown parking portfolio, which currently consists of fiveparking garages, 17 surface lots, on-streetmeters and free parking spaces (totaling 3,701 spaces). It has direct responsibility for the operation, maintenance, capital rehabilitation and fiscal management of the City’s public parking infrastructure. Benchmarking: The table below outlines current prices of monthly parking for surface and garage facilities in the downtown. The City’s monthly parking prices are at the high end of the spectrum. Current Parking Operators Monthly Parking Fees before HST Provider Surface Garage Major 3rd party Private Business $118.65 $125.00 City of Waterloo $118.87 $153.82 City of Kitchener - Downtown $140.35 $159.38 Primary Legislation: Not applicable. Customer Base: All garage and surface facilities are open to anyone living, working or visiting the downtown. 2020 is the first year in nearly a decade that we are projecting less monthly parkers and daily customers than the year previous. The customer base has declinedsignificantly in 2020 as a result of COVID-19 pandemic with a projected reduction of over 25%. Projected revenue for daily use in all parking facilities is projected to decline by 60% in 2020. Inventory has decreased in the past couple of years with the sale of 345 King Street, the Forsyth Lot and most recently the conversion of Seignor Lane Lot into a municipal park. Recent Challenges: The Parking Enterprise is experiencing a significant negative impact from the COVID-19 pandemic with a substantial drop in revenue due to a reduction in monthly/hourly parking demand. The reduced demand is a direct result of temporary closures of businesses, necessary social distancing measures, and work from home protocols. Parking expects the reduced revenues in 2020 will continue through at least 2021 deficits as it is still not yet known how O - 83 CITY OF KITCHENER ENTERPRISE OVERVIEW parking demandwill be impacted insubsequent stages of pandemic recovery, both in the short and long term. Recent Successes: The Parking Enterprise successfully launched its new Pay by Mobile App called Passport Parking on June 19, 2019. The mobile app reduces the exposure to “touch points” associated with parking equipment as customers can complete transactions via their personal mobile devices. This has limited the need for public to interface with parking equipment during the pandemic. O - 84 85 - O 86 - O CITY OF KITCHENER ENTERPRISE OVERVIEW Gas Utility Operating Model/Philosophy: Provide customers with safe, dependable and economical natural gas. Provide prompt, cost effective and professional servicesrelated to rental water heaters. Promote conservation, greenhouse gas reduction (GHG)and operate in an environmentallysensitive manner. Services Provided: Gas Supply:Kitchener Utilities purchases and manages the gas supply to meet customer requirements. Gas Distribution: As a natural gas distributor, Kitchener Utilitiesdelivers natural gas to consumers. Work includes installingand replacing meters, underground pipe installationand maintenance, providing gas servicesto homes and business, respondingto gas emergencies involving gas line hits, gas odour, carbon monoxide, and gas utility locates. Regulatory Affairs: Ensuringcompliance with codes, rules and regulations imposed by government agencies and regulators. Conservation: Developing and promoting GHG reduction and conservation programs which help customers save money and conserve energy. Water Heater Rentals & Service: Supply and service water heaters on a rental basis, providing 24/7 service for repair and replacement of tanks. Benchmarking: Over the past number of years, the mix of customers has shifted to more residential and less industrial. This impacts the gas supply and distribution system as it becomes more sensitive to weather driven peak hourly and daily demandfor natural gas. This challenges the system as it must be designed and capable of delivering natural gas under peak conditions to meet firm customer demands. Therefore, the annual volume will be largely impacted due to the weather conditions. O - 87 CITY OF KITCHENER ENTERPRISE OVERVIEW Gas Volumes -(m3) 300,000,000 250,000,000 200,000,000 150,000,000 100,000,000 50,000,000 0 Primary Legislation: Technical Standards and Safety Act 2000 Ontario Regulation 210/01 Oil & Gas Pipeline Systems Canadian Standards Association Z662-11 Pipeline Systems Essentials Code Canadian Standards Association Z246.1-09 Security Management for Petroleum and Natural Gas Industry Systems Code Canadian Standards Association B149.1-10 Natural Gas and Propane Installation Code Ontario Regulation 212/01 Gaseous fuels Ontario Regulation 184/03/215 Fuel industry certificates Measurement Canada – Gas Meters Electricity and Gas Inspection Act Ontario Energy Board – Gas Distribution Access Rule, Demand Side Management Guidelines, Code of Conduct, Storage and Transportation Access Rule Climate Change Mitigation and Low-Carbon Economy Act, 2016, S.O. 2016, c. 7 Customer Base: Natural Gas: 71,000 Rental Water Heaters: 43,000 Recent Challenges: With the increase in the number of residential customers and the rise in occurrence of extreme weather patterns, there is a requirement to increase pipeline capacity. Pipe sizes must be increased to meet the peak hourly and daily demand requirements. This will require additional capital funding over the next several years. High demand for natural gas during peak winter days causes pressure to drop in the pipeline network. If the pressure drops significantly, safety O - 88 CITY OF KITCHENER ENTERPRISE OVERVIEW equipment on the meter shuts off the flow of natural gas to the home. Kitchener Utilitieswould then have to inspect and relight the gas appliances. In recent years, there has been an increase in development activity within the City of Kitchener. As the gas utility has infrastructure within Regional and City roads, we are required to move our infrastructure at their direction and largely at our cost. In addition, customer driven projects, such as installation of gas piping in subdivisions, are funded 100% by the utility. In order to meet schedule requirements of the Region of Waterloo and developers, there has been increased pressure on the capital budget. The number of gas meters replaced annually fluctuates based on Measurement Canada’s requirement which takes into account the age and accuracy of the meter. To test the accuracy of the meter, a representative sample is collected and tested by a third party. If the results are within tolerance, the meter life can be extended. In 2020 there was a large number of gas meters that required replacement which will continue in 2021, putting additional pressure on the budget. Recent Successes: The implementation of the new meter inventory management system (MIMS) was launched in 2020. The new system will improve the management of meters and increase administrative efficiencies as new meters will be directly scanned in and out of the database reducing data entry. Kitchener Utilities is continuing to offer a $250 on-bill credit to upgrade customers furnace to a higher efficiency model. The program continues to be a success with a high uptake. O - 89 90 - O 91 - O 92 - O 93 - O 94 - O 95 - O 96 - O 97 - O CITY OF KITCHENER ENTERPRISE OVERVIEW Water Utility Operating Model/Philosophy: Provide customers with quality, dependable, and economical distribution of water. Promote conservation and operate in an environmentally sensitive manner. Services Provided: Water Distribution: Monitoring, installing, replacing and repairing the network of water mains, meters and services to ensure a reliable and safe supply of water. Conservation: Promotingconservation programs, which help customers reduce the amount of water used which save both money and conserves energy. Benchmarking: While the population of Kitchener continues to grow, water use hadbeen declining for more than a decade until 2017.Water use decreased from 2005-2017 but increased slightly in 2018, largely due to hotter weather compared to 2017. Water supply demand forecasts indicated that 2018 would be the year that population demand would outpace water conservation measures, which is exactly what happened. It is expected that water use may fluctuate around this volume depending on weather until population demand clearly exceeds conservation measures. Metered Water (M3) 25,000,000 20,000,000 15,000,000 10,000,000 5,000,000 0 Year O - 98 CITY OF KITCHENER ENTERPRISE OVERVIEW Primary Legislation: Safe Drinking Water Act, 2002. Ontario Regulation 170/03 Drinking Water Systems Ontario Regulation 128/04 Certification of Drinking Water System Operator and Water Quality Analysis Ontario Regulation 169/03 Ontario Drinking Water Quality Standards Ontario Regulation 188/07 Licensing of Municipal Drinking Water Systems Watermain Disinfection Procedure Customer Base: Water: 68,000 Recent Challenges: The Ministry of Environment, Conservation and Parks inspection identified an instance of non- compliance with the City of Kitchener in early 2020 for new watermains not being mapped within 12 months of installation. A work plan was submitted which represents a higher level of service for the production and cataloguing of as-recorded information. Additional resources may be required to meet the requirements. COVID-19 Impacts: Delayed start for a number of maintenance programs, but all maintenance activities will be caught up by the end of the year. Delayed start of construction related activity resulting in a surge of construction support during April and May (cut and cap inspections, final connection inspection and valving). Levels have dropped back down to normal, however there is still a lot of new development and reconstruction activity in the City. Additional flushing due to many businesses not using water (stagnant water). Development of a communications program for businesses to flush upon re-opening to eliminate stagnant water Additional private water sampling sites were developed since the majority of sampling sites were closed businesses and community centres. Relief to decrease the number of samples as well as to decrease the fall lead sampling was also obtained. Limited access to customer homes prevented non-emergency water meter replacement/repair activities. As a result there is a backlog of maintenance work. Contractor assisted replacement will occur from July to the end of the year. Delay in hiring of vacant positions for front-line staff as well as a delay in training sessions Recent Successes: Completion of the Four Utility Review which ensured that the organizational structure was properly set up to support the collaboration and asset management opportunities outlined in the Water Infrastructure Program (WIP). Impacts relating specifically to Water include cross training of Construction and Maintenance Staff and diversion of some gas work to a different group to increase capacity for water related maintenance activities. A dedicated Quality Management O - 99 CITY OF KITCHENER ENTERPRISE OVERVIEW System (QMS) Specialist for the drinking water system was filled in 2019. The role was previously split between gas and water. Implemented a mobile solution for reporting watermain breaks to improve customer communication. Rolled out a new mobile water valve inspection solution to minimize data entry and provide faster deficiency follow-up. It is anticipated that other maintenance programs will follow this framework. Initiation of the re-vamped training programs including Drinking Water Quality Management System Awareness, Cut and Cap and Final Connection Training and Subdivision Inspection training. Water Construction and Water Emergency training programs are being revised, with anticipated training by the end of the year. Ongoing maintenance including watermain cleaning, valve operation, hydrant maintenance and painting, water meter replacement and replacement of broken water valves. O - 100 101 - O 102 - O CITY OF KITCHENER ENTERPRISE OVERVIEW Sanitary Sewer Utility (Wastewater) Operating Model/Philosophy: The Sanitary Sewer utility collects and removes wastewater generated within Kitchener and neighbouring municipalities in an efficient, cost effective, and environmentally responsible manner, in compliance with legislative and regulatory requirements. Services Provided: The Sanitary Sewer utility performs a wide range of activities and programs that together supports the provision of safe and reliable collection of raw sewage, including: The Water Infrastructure Program (WIP) – previously known as AIRP Pumping station rehabilitation and replacement Trenchless sewer rehabilitation Trunk sewer replacement Sewer main & lateral repair Pumping station maintenance Flow monitoring and hydraulic modeling Closed Circuit Television (CCTV) inspection program Sewer flushing program Year round on-call staff (emergency response) Service connection blockage clearing Supervisory Control and Data Acquisition (SCADA) forpumping stations The City works in conjunction with the Region of Waterloo in the management of wastewater. The City collects and conveys sewage to regional wastewater facilities that ultimately treat and dispose of treated effluent. Benchmarking: The Utility is participating in the National Water and Wastewater Benchmarking Initiative which looks at key performance indicators for municipalities across the country. Data isgathered annually, processed and compared to previous years’ data as well as data from other municipalities. Primary Legislation: Clean Water Act Environmental Assessment Act Ontario Water Resources Act Canadian Environmental ProtectionAct, etc. Customer Base: Nearly every residential, commercial, industrial, and institutional building in the city generates wastewater. In total, this equates to over 65,000 customers billed for this service. O - 103 CITY OF KITCHENER ENTERPRISE OVERVIEW Recent Challenges: Operational: (1) The impacts of COVID-19 have delayed some sanitary services and have required alternative means of delivery for others. We continue to prioritize work and address the most critical infrastructure and maintenance needs to ensure reliable and high-quality sanitary services are provided to customers. (2) In many parts of the City, sanitary assets are nearing the end of their lifecycle and require increased funding and resources to undertake preventative and corrective maintenance. Budgetary: (1) Construction costs for replacement and rehabilitation of infrastructure from 2004 to 2019 were significantly greater than the CPIrate of inflation. (2) Unit costs for regional sewage processing have traditionallybeen above the rate of inflation, putting upward pressure on the City’s sanitary sewer rate. Strategic: Similar to the strategy developed for the Stormwater Utility and the implementation of a Master Plan in 2016, the Sanitary Utility also needs a Master Plan to guide capital and operating investments over the next 10-15 years. A similar process will be followed, structured under Municipal Class Environmental Assessment guidelines. Recent Successes: (1) The Water Infrastructure Program saw an additional 6.4 kilometers of sewer mains rehabilitated and/or replaced in 2020, adding capacity and reliability to sanitary services. (2) The construction has started on the Middle Strasburg Trunk Sanitary Sewer which will provide the required sanitary capacity for growth in south-west Kitchener. (3) The implementation of a state-of-the-art SCADA system for the monitoring and control of the City’s 22 sanitary sewage pumping stations is underway and will be complete by the end of 2021. (4) A detailed assessment is underway for the City’s sanitary sewage pumping stations and is key to identifying required improvements to keep the facilities operating reliably and in accordance with legislated standards. The study will also include Energy Audits on each facility to identify opportunities for reduction of greenhouse gas emissions in accordance with the City’s Corporate Climate Action Plan. O - 104 105 - O 106 - O CITY OF KITCHENER ENTERPRISE OVERVIEW Stormwater Utility Operating Model/Philosophy: The Stormwater utility provides services that help managethe flow, quantity and quality of stormwater in the city in an efficient, cost-effective and environmentally responsible manner to comply with legislative and regulatory requirements. Services Provided: The utility funds the operation, maintenance, rehabilitation, replacement and construction of stormwater infrastructure across the city. The stormwater system is comprised of approximately 139 kilometers of open watercourses in 26 subwatersheds, 722 kilometers of storm sewers, over 24,300 manholes and catch basins, 65 hydrodynamic separators, and 101 constructed stormwater management facilities (SWMFs). Additional SWMFs will be coming into City ownership from new developments and will become a maintenance obligation. Services include capital projects identified by the Integrated Stormwater Management Master Plan (2016) to address portions of the 75% of the City which have limited stormwater management controls. Other projects are required to mitigate flooding risks in various parts of the City. In addition to discreet capital projects, annual programs are established to address recurring activities. These include: Stormwater Management (SWM) Low Impact Development (LID) and Monitoring Program Green Infrastructure in WIP Projects Sediment Management Program Sewer Mains, Catchbasin & Manhole Maintenance and Repair Watercourse Improvement Program Watercourse/Bridge/Culvert SWM Facility Retrofit Program Maintenance and Repair Drainage Improvement Program SWMF Maintenance & Sediment Hydraulic and hydrological Removal modelling Catchbasin Cleaning Program SWM Infrastructure Implementation Street Sweeping Program Leaf Pickup Water Infrastructure Program (WIP) Spills Response The utility also funds a credit program to provide an incentive to private property owners to support the management of stormwater on private property. An enhanced market incentive program to cost share the installation of best management practices on private property is anticipated to be rolled out to the community in 2021. Benchmarking: The stormwater utility finalized the Integrated Stormwater Management Master Plan (ISWM- MP) to replace the 2001 SWM Policy I-1135 with policy MUN-UTI-2003. The master plan establishes goals and objectives as well as provides direction to the utility until the year 2030. There is an annual process of measuring progress against planned progress in the ISWM-MP. Additionally, the utility is participating in the National Water and Wastewater Benchmarking Initiative, which looks at key performance indicators for municipalities across the country. Data O - 107 CITY OF KITCHENER ENTERPRISE OVERVIEW is gathered annually, processed and compared to previous years’ data as well as data from other municipalities. Primary Legislation: Clean Water Act,Canadian Environmental Protection Act, Environmental Assessment Act, Canadian Fisheries Act, etc. Ontario Water Resources Act, Customer Base: All owners of properties in the city that have impervious area are generators of runoff during precipitation events. There are over 70,000 properties in the city that arebilledfor the stormwater management service based on the amount of their impervious area. Recent Challenges: Operational: Storm events are becoming more severe and intense which has a direct impact to the entire stormwater system by either causing damage to, or exceeding the capacity of existing infrastructure in an unpredictable manner. Legislative: The new legislation for the Sewer Safety Inspections process has resulted in an increased level of service that is now required for the locating of utilities prior to construction activities taking place. Environmental permits for capital projects can cause project delays. There are discussions taking place with the Province to establish a City-wide environmental compliance approval for all capital works in the city. This will create additional administrative challenges for staff in the short run, however, it may improve efficiencies in the long run. Budgetary: (1) There is an existing backlog of legacy projects identified in previous stormwater audits that can only be completed as funding becomes available. (2) Growth applies pressures to operations and maintenance budgets to ensure current service levels meet legislative requirements. Further pressures will result as the utility transitions to a more preventative and proactive maintenance approach. Recent Successes: Operations and Maintenance: Operations staff anticipate removing over 3,370 metric tons of sediment from stormwater facilities in 2020 to improve water quality. It is anticipated that with the work in 2020, a total of 73 out of 101 stormwater ponds will have been cleaned over the last several years. Capital Works: (1) The restoration of SWM Facility 65 on Trillium Dr (near Bleams Rd) is a significant capital construction project for 2020. Additionally, design and construction work related to the federal Disaster Mitigation and Adaptation Fund (DMAF) has been initiated. The st DMAF program runs until March 31, 2028. Grant Funding: DMAF provides the City up to 40% reimbursement of eligible project costs to support the implementation of the ISWM-MP and other priority stormwater projects across the City. The total cost of the projects included in Kitchener’s DMAF program is $125M. O - 108 109 - O 110 - O 111 - O 112 - O