HomeMy WebLinkAboutFCS-11-171 - 2012 Budget - Deferral of Development Charges Project.pdfStaff Re~p~r~
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REPORT TO: Finance and Corporate Services Committee
DATE OF MEETING: October 17, 2011
SUBMITTED BY: Dan Chapman, Deputy CAO
PREPARED BY: Ryan Hagey, Manager/Interim Director of Financial Planning
WARD(S) INVOLVED: All
DATE OF REPORT: October 7, 2011
REPORT NO.: FCS-11-171
SUBJECT: 2012 BUDGET -DEFERRAL OF DEVELOPMENT CHARGE
PROJECTS
RECOMMENDATION:
For information only.
BACKGROUND:
During presentation of the 2011 budget, staff identified the impending need to defer growth
related capital projects in the near future in order to better balance the development charge
reserve fund. The development charge reserve fund has proceeded into a deficit position due
to revenue shortfalls in recent years coupled with cost escalation in some projects (e.g. Homer
Watson Pumping Station).
During presentation of the 2012 budget guidelines report, the need to defer projects was again
identified by staff since development charge revenues continued to lag behind forecasted
amounts. As part of the 2012 budget development cycle, staff committed to:
1. Internally review growth related projects for potential deferrals
2. Allow an opportunity for public feedback in advance of capital budget presentation
3. Allow an opportunity for Council feedback in advance of capital budget presentation
The purpose of this report is to demonstrate how staff have already accomplished items one
and two from above, and to allow for Council feedback prior to presenting the capital budget
(item three).
REPORT:
Overview
The development charge reserve fund was in a negative position of over $2M at the end of
2010, and was projected to get worse without a reprioritization of work. The 2011 budget
presented to Council would have seen a deficit of over $12M in the reserve fund by the end of
2012, and would have stayed in a deficit position of nearly $8M by the end of 2013. These
values assume that revenue targets were met and no project cost over runs occurred.
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Carrying a significant deficit balance in the development charge reserve fund is not a viable
option for the City, as reserve fund balances as a whole are at critically low levels compared
against industry benchmarks and peer municipalities. While issuing debt to fund the shortfall in
the reserve fund is permitted, it also is not a viable option given the City's high debt load as it
approaches the final years of the EDIF program. If the City is required to fund the growth
projects through the development charge reserve fund, the only prudent alternative is to defer
spending until a time when there is sufficient funding in the reserve fund to complete the
projects without creating a significant deficit.
Another option to complete the projects in the near future, but not negatively impact the
development charge reserve fund, is for the City to enter into acredit/refund agreement with a
developer. Under these agreements, developers either construct, or pay to have constructed,
infrastructure that the City is unwilling or unable to fund itself. Reimbursement to the developer
is provided by way of development charge credit and or refund.
Each credit/refund agreement is a legal document that sets out all terms and conditions in
detail, but some general guidelines for the types of projects that qualify include:
• Projects in high priority lands (designated A or B in the City's Growth Management Plan)
• Engineering related projects (although exceptions for park and trail development will be
considered)
Item 1: Internal Review of Growth Related Capital Projects funded by Development
Charges
Process
A cross functional team met several times to review and prioritize the upcoming growth related
projects in the capital forecast. The team composition included representatives from divisions
which had development charge funded projects and included staff from each department as well
as the Library.
Instead of focusing on all 10 years of the capital forecast, the team decided to focus on projects
in the near future. A time frame of 2012-2014 was chosen because a) the largest funding gaps
were in this timeframe, and b) it coincided with the timing for an update to the development
charge background study (planned to be completed in 2014).
The team agreed with the principles of not worsening the development charge reserve fund
balance beyond the current balance and improving it to surplus by the end of 2014, meaning
that some projects within that timeframe would need to be deferred beyond 2014. Based on
trend analysis over the past five years, Finance staff estimated there will be approximately
$29M of development charge revenue available to fund capital projects to the end of 2014. For
simplicity, all projects deferred beyond the 2012-2014 window were moved out to 2015. Since a
new development charge background study will be prepared in 2014, the timing of all projects in
2015 and beyond must be considered very tentative. The section below titled "Challenges in
2015 and Beyond" outlines some of the issues that will need to be addressed in the next
development charge background study.
The prioritization of projects within the 2012-2014 window was completed by using a scoring
matrix. A number of different ranking criteria were identified and then assigned a weighting
score. A matrix was completed for each of the 35 projects, compiled by Finance, and then
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I~TCn~nT~~ Finance and Corporate Serlvices Department www.kitthenexca
reviewed by the team. The projects with the highest scores were deemed to be a higher priority
than projects with a low score, so high scoring projects would receive funding and low scoring
projects would be deferred beyond 2014.
Results
The prioritized ranking of all 35 projects can be found in Appendix A (Project Division -Above
the Line and Below the Line). As shown in the appendix, 17 projects qualify for development
charge funding (i.e. are above the line) using a funding cut off point of $29M. This means there
are 18 projects that fall below the funding line and are deferred beyond 2014. In most cases, the
projects with the highest scores are above the line, but the last four projects which are above
the line (General Park Development, Major Park Development, Community Trails, and Trail
Crossings) have scores less than the first project in the below the line category. The team
moved these projects above the line as they are key deliverables from the Parks Masterplan,
have not fully been addressed in previous budgets, and are known to be Council and
community priorities.
The results of all the matrix scores for each of the 35 projects are attached as Appendix B
(Matrix Score Summary). The first page of the appendix shows all the scores for projects that
are above the line, with the second page showing the scores for projects below the line.
Descriptions of all 35 projects can be found in Appendix C (Project Descriptions).
A revised projection of the development charge reserve fund based on the deferrals outlined in
this report is attached as Appendix D (Development Charges Total Reserve). As can be seen in
the bottom line of the chart, the overall balance in the reserve fund at the end of 2011 is -$5.2M.
The reserve fund balance remains relatively unchanged at -$5.3M in 2012, worsens to -$7.9M in
2013, before improving significantly to +$1 M in 2014. As part of the 2012 budget process, staff
will review existing capital balances as well as the timing of 2013 development charge funded
projects in order to better maintain the reserve fund balance at the 2011 level.
Challenges in 2015 and Beyond
There are a number of known challenges which will need to addressed in the next development
charge study. These include:
a) Projects deferred from 2012-2014 to 2015
b) Development charge revenue shortfall
c) Ontario Municipal Board (OMB) decision in Orangeville
First, as noted above, a number of projects that were in 2012-2014 have been moved out to
2015 for reprioritization during the next development charge study. In order to accommodate
these projects in 2015, others will need to be deferred, which will cause a domino effect of
project deferrals in order to balance available funding with project requests. The timing of these
projects may impact the rates in the next development charge study.
Second, the City has been experiencing actual development charge revenues which are less
than what was forecasted in the current development charge study. The revenue forecasts are
based on an average of long-term growth projections. The actual residential development
levels were 355 dwelling units lower than the 2009 forecast and about 300 dwelling units lower
in 2010. The City's development charge rates may need to be increased in the next study to
make up for the difference between projected revenues and actual revenues.
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I~TCn~nT~~ Finance and Corporate Serlvices Department
www.kitchenerca
Third, a recent ruling by the Ontario Municipal Board (OMB) in Orangeville may negatively
impact Kitchener's development charge revenues for non-engineering projects. The OMB
decision in Orangeville stated that they should not have used the gross population methodology
to determine their charge, but should have used the net population methodology. This change
in methodology impacts non-engineering projects only, but significantly reduces the amount of
development charge funding a municipality can raise for growth related projects. The OMB
decision only applies to Orangeville, but could be used as the basis for development charge
background studies in other municipalities. Kitchener used the gross population methodology in
the current development charge study, so there is a risk of lost revenue in future development
charge studies if the methodology is changed. Initial calculations of the potential negative
impact to Kitchener's development charge revenues are in excess of $30M. The primary
services impacted by any change might be indoor recreation, public works, library, outdoor
recreation, parking and fire.
Item 2: Public Feedback
The projects that fell below the line for funding are mainly Engineering projects related to roads,
sewers, and storm water. In order to receive feedback on these projects, a draft version of this
report was presented to the Waterloo Region Homebuilders Association at the monthly Liaison
Committee meeting on September 16, 2011. Written feedback received from the Homebuilders
Association has been attached in Appendix E.
The four projects that are not Engineering related are listed below with a comment regarding the
feedback received about that project.
Project Public Feedback
Equipment Acquisition/Upgrades No feedback sought as this project relates to improvements
to the City fleet. This may negatively impact service
delivery if there is not enough equipment to accommodate
growth within the city.
Synthetic Turf Staff have received feedback from the Kitchener Soccer
Club which is included in A endix E
Williamsburg Cemetery -Phase 2 No feedback sought. 90% of the funding for this project
remains intact in 2012 with only the 10% funded from
development charges being deferred beyond 2014.
Heritage Impact Assessments No feedback sought as this project is used by Planning staff
to complete assessments or peer reviews. This may
negatively impact the City's ability to complete
assessments in the future.
Item 3: Council Feedback
Council requested an opportunity to provide input in advance of the 2012 capital budget. This
report is being brought forward to committee in October to accomplish that goal. Council
feedback will be incorporated into the capital budget presentation scheduled for November 17,
2011.
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I~TC~~nT~~ Finance and Corporate Serlvr`ces Deparfm~nt www.kitchenexca
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
Foundation: Efficient and Effective Government
Goal: Financial Management
Strategic Direction: Ensure the effective and responsible stewardship of public funds within a
supportive policy framework
FINANCIAL IMPLICATIONS:
By deferring over $12M of development charge funded capital projects to 2015, the City will be
in a relatively balanced position heading into the next development charge study.
COMMUNITY ENGAGEMENT:
As noted in the report, key stakeholders were contacted and provided an opportunity to provide
written comments to be included as an appendix to the report. Public feedback received has
been included in Appendix E of this report.
ATTACHMENTS:
Appendix A - Project Division -Above the Line and Below the Line
Appendix B - Matrix Score Summary
Appendix C - Project Descriptions
Appendix D - Development Charges Total Reserve
Appendix E - Public Feedback.
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO and City Treasurer
(Finance and Corporate Services)
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APPENDIX A
Project Division -Above the Line and Below the Line
Rank
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
Project Name 2012 2013 2014 TOTAL Score
Above the Line Projects
Planning Studies 155 155 155 465 35.5
Huron Rd/Strasburg to Fischer Hallman 5,292 5,292 35.0
Monitor & Update Upper Blair 106 108 110 324 32.5
DC Study 10 210 220 30.0
Engineering Studies 159 162 166 487 29.5
Freeport Pumping Station Upgrade 500 2,450 1,050 4,000 29.0
Central Library-Non EDIF 3,242 268 3,510 27.5
Intensification Allowance 631 643 1,274 27.5
Centre Block Parking (to EDIF) 2,500 2,500 25.5
Consolidated Maintenance Facility 380 31 411 25.0
Fire Radio System Upgrade 20 20 25.0
Blockline Rd. East 4,000 4,000 8,000 24.0
City Share of Subdivisions 263 276 539 23.5
General Park Development 308 314 321 943 19.5
Major Park Development 314 320 326 960 18.0
Community Trails 46 47 48 141 17.0
Trail Crossin s 34 34 68 16.5
Subtotal -Above the Line Projects 11,294 14,233 3,627 29,154
Below the Line Projects
South Strasburg Creek Sanitary Sewer 2,885 1,746 4,631 21.5
Equipment Acquisitions/Upgrades 315 321 328 964 19.5
Forwell Pumping Station Upgrade 315 1,061 1,376 17.5
Pioneer Tower Pumping Station Upgrade 77 435 512 17.5
Falconridge Pumping Station Upgrade 75 426 501 17.5
Intersection Imprvts -Doon Village 234 234 17.0
Intersection Imprvts -Doon South 2013 187 187 17.0
Borden Greenway Trunk Sewer 392 392 16.0
Project Management Initiative 15 15 15.5
Synthetic Turf 573 573 15.0
Kolb Drain/Smetana at Rothsay 273 273 15.0
Schneider Creek Channel 1,061 1,061 12.5
Williamsburg -Phase 2 95 95 12.5
Biehn Drive Sanitary Trunk Sewer Extension 87 494 581 11.0
Idlewood Creek 421 421 9.0
Miscellaneous Creek Rehab 106 108 110 324 7.0
East Side Flow Monitoring & SCADA 85 87 88 260 5.0
Herita e Im act Assessments 14 15 15 44 2.0
Subtotal -Below the Line Projects 2,039 5,134 5,271 12,444
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APPENDIX C
PROJECT DESCRIPTIONS
1. Planning Studies
General account used to fund a variety ofgrowth-related activities including studies and
community engagement that prepare land for development, support the growth
management program and the official plan review. One salary is currently funded from
this account.
2. Huron Road -Strasburg to Fischer-Hallman
The road will be reconstructed to a modern urban standard from Strasburg Road to
Fischer-Hallman Road. This project will include a creek crossing, addition of traffic
controls, a 300mm watermain as well as the conversion of the intersection at Strasburg
Rd and Huron Rd into a roundabout. Huron Road has now been upgraded from Homer
Watson Boulevard to Strasburg Road.
3. Monitor/Update Program -Upper Blair Creek
Monitoring natural indicators (ground, surface, benthic, aquatic, terrestrial) for the Upper
Blair Creek drainage basin. Program to ensure the Upper Blair Creek Drainage Study is
properly implemented.
4. DC Study
The City of Kitchener is required by legislation to complete a new background study by
mid- 2014 however, ongoing work and consultations happen throughout each year.
Preparations for the new background study have already started, and in depth work will
commence in 2013.
5. Engineering Studies
Engineering studies and environmental assessments that were not defined at the time of
the Development Charge Study.
6. Freeport Sanitary Pumping Station Upgrades
This project will involve a detailed capacity and infrastructure analysis as well as an
Environmental Assessment for the existing sanitary pumping station and future
forcemain. This will be followed by upgrades to the existing pumping station and
construction of a new forcemain which will accommodate all future flows.
7. Central Library Non-EDIF
The New Central Library project provides much needed space for current collections and
services, and will accommodate future growth. The project involves a complete
renovation of the existing Main Library with an addition of 25,000 square foot to the rear
of the building. The project also addresses parking needs for the library and Civic
District partners through the construction of a 412 space, three-level underground
parking garage.
8. Intensification Allowance
This account is used to upgrade engineering services due to the intensification within
central neighbourhood areas, as identified in the DC background study.
Existing sewer, water and road infrastructure will be replaced due to additional capacity
requirements due to intensification associated within the central neighbourhoods area.
This work is typically integrated as part of the City's accelerated infrastructure
replacement program.
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APPENDIX C
PROJECT DESCRIPTIONS
9. Centre Block Parking (to EDIF)
The Economic Development Investment Fund (EDIF) is responsible for funding the non-
residential development charge rate phase-in (2009) and the downtown exemption
(2009-2014), as approved by Council. This impact will be mitigated through the
allocation of parking development charges to EDIF, in relation to the Centre Block
Parking Garage.
10. Consolidated Maintenance Facility
The Consolidated Maintenance Facility replaced existing public works buildings
throughout the City. A number of municipal operations and services are now
consolidated under one roof, including: road maintenance, snow clearing, watermain and
sewer maintenance, gas-line works/utilities, parks and woodland maintenance, fleet
repair, city facilities management; as well as the city's corporate call centre, stockrooms,
salt storage, bulk material storage and greenhouses.
11. Fire Radio System Upgrade
To upgrade the existing radio system as technology changes.
12. Blockline Road East
Block Line Road is proposed to be extended from Lennox Lewis Way to Courtland
Avenue. An Environmental Assessment was completed by the City in May 2001 and the
first section of road from Homer Watson Boulevard to Lennox Lewis Way has been
completed. The remaining stretch of road from Lennox Lewis Way to Courtland Avenue
across Schneider Creek and the Railway Yards requires a bridge. The City is currently
undertaking detailed design of the portion of the road from Lennox Lewis Way to
Courtland Avenue.
13. City Share of Subdivisions
Possible projects include road widening and the installation of new sidewalks on back-
lotted arterial roads. It has been the practice of the City to set aside funds from the
Development Charge Reserve Fund for the City's share of works to be done in
subdivisions and adjacent thereto. Due to DC fund cashflow constraints, funds will be re
allocated from 2009, 2010 and 2011 to 2012, 2013 and 2014, respectively.
14. General Park Development
Capital budget is use to development neighbourhood parks within new subdivisions. The
Developer is required to grade and seed the park land and this funding is used to
develop the playgrounds, trails, plantings, sportsfields, benches and any other amenities
within the park.
15. Major Park Development:
As subdivisions are developed, addition pressures are put on our existing major parks
such as Budd Park, Southwest Optimist Park, and Peter Hallman Ballyard with the
increased use. Funding is required to update the facility including irrigation systems,
lighting, bleachers and other amenities.
16. Community Trails
As new developments are created, the community trails are also planned and built as
funding becomes available within each development to create a recreational amenity for
the entire neighbourhood to enjoy.
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APPENDIX C
PROJECT DESCRIPTIONS
17. Trail Crossings
Trail crossings are a priority to connect one new development to another. As new
developments happen, trails are planned within the development and connectors
between developments needs to be funded to connect a continuous community trail
across street intersections.
18. South Strasburg Creek Sanitary Trunk Sewer
The South portion of the trunk sewer needs to be designed and constructed from its
current terminus to approximately 2.2km upstream in accordance with the South
Strasburg Gravity Trunk Sanitary Sewer Environmental Study Report.
19. Equipment Acquisition/Upgrades
This project supports the acquisition of additional vehicles and equipment to support
growth, and upgrades to original vehicle specification to meet the needs of user
departments.
20. Forwell Sanitary Pumping Station Upgrades
The City requires that the existing pumping station be upgraded to accommodate
planned future development. An Environmental Assessment will be required to
determine the extent of upgrades required to the Forwell Sanitary Pumping Station.
21. Pioneer Tower Sanitary Pumping Station Upgrades
The City requires that the existing pumping station be upgraded to accommodate
planned future development. An Environmental Assessment will be required to
determine the extent of upgrades required to the Pioneer Tower Sanitary Pumping
Station.
22. Falconridge Sanitary Pumping Station Upgrades
The City requires that the existing pumping station be upgraded to accommodate
planned future development. An Environmental Assessment will be required to
determine the extent of upgrades required to the Falconridge Sanitary Pumping Station.
23. Intersection Improvements -Doon Village Road at Homer Watson Blvd
New development in the south end of Kitchener requires improvements to transportation
infrastructure in order to accommodate greater traffic loading generated by development.
Currently, this improvement is envisioned to be a conversion to a roundabout.
24. Intersection Improvements -Doon South Area (4 locations)
New development in the south end of Kitchener requires improvements to transportation
infrastructure in order to accommodate greater traffic loading generated by development.
Locations include: Pioneer Dr. and Homer Watson Blvd.; Doon Village Rd. and Pioneer
Dr.; Doon South Dr. at Homer Watson Blvd.; and Battler Rd. at Huron Rd.
25. Borden Greenway Trunk Sanitary Sewer
A short section of the Borden Greenway Trunk Sanitary Sewer (46 metres south of
Ottawa Street South to a manhole just north of Ottawa Street South) must be upsized in
order to accommodate the ultimate flows from areas west of Westmount Road. An
Environmental Assessment Study will be required to determine the preferred method of
achieving sanitary sewer upgrades.
3- 11
APPENDIX C
PROJECT DESCRIPTIONS
26. Project Management Initiative
To continue the development and refinement of the City of Engineering Services
Division's project management practices, methodologies and processes. Project
management training and process mapping in accordance with Project Management
Institute (PMI) best practices. The four process groups are: Planning, Executing,
Monitoring and Controlling, and Closing.
27. Synthetic Turf
Synthetic fields are a necessity as more users come to Kitchener through subdivision
development. Synthetic fields can be played on in all types of weather, starting earlier in
the spring season and scheduling later in the year. Times of use of synthetic fields is
increased with less wear and tear and with reduced operational maintenance costs.
28. Kolb Drain Stormwater Network Remediation
In 1976, the City commissioned a study to determine the costs of upgrading the Kolb
Greenway system from the Grand River to that part of the greenway that is situated in
the former Brookfield Boulevard. An Environmental Assessment Study will be required to
determine the preferred solution to handling this work. To date this greenway has been
completed from Matthew Street to the Grand River. It is anticipated that a functional
report will be required as well as a landscaping plan.
29. Schneider Creek Channel -Phase 1
In 1995, Paragon Engineering Limited finalized the Schneider Creek Remediation Class
Environmental Assessment, Environmental Study Report for Schneider Creek between
Manitou Drive and Hayward Avenue under the direction of the Grand River Conservation
Authority. This Environmental Assessment has been updated to reflect current practice
for rehabilitating this stream. Watercourse improvements are proposed including the
installation of new culverts.
30. Williamsburg -Phase 2
Williamsburg Cemetery is Kitchener's newest cemetery located in the south-west area of
the City. It was planned in two phases. Phase 1 has been in operation since 1995. A
recent demand study was undertaken and it indicated that two lot graves would be
required in Phase 2 starting in 2015. Therefore site and infrastructure development for
Phase 2 must start in 2012 to ensure gravesites are ready for sale to public in 2015.
31. Biehn Drive Sanitary Trunk Sewer Extension
A 630m sanitary trunk sewer extension is required along Biehn Drive to the Strasburg
Road extension to support new development in the area.
32. Idlewood Creek Improvements
As a result of all the new development in the Idlewood area, it is anticipated that there
will be some remedial work required on Idlewood Creek from the Grand River to
Woolner Road. A creek assessment was completed in 2009, and at this point there are
no immediate requirements to complete remediation work.
33. Miscellaneous Creek Rehabilitation
This is intended to support creek rehabilitation projects either as a result of future
development within the City or as related to other Development Charges projects.
3- 12
APPENDIX C
PROJECT DESCRIPTIONS
34. East Side Flow Monitoring and SCADA Controls Program
In 2002/2003 the City of Kitchener retained Dillon Consulting Ltd. to complete a report
entitled "Master Plan, Ottawa-Manchester-Montgomery Trunk Sanitary Sewer System,
Phasing & Implementation Plan". As a result of the study, it was determined that a flow
control (S.C.A.D.A.) system and permanent monitoring stations would be required on
five pumping stations in this area in order to control flows to the Montgomery Trunk
Sanitary Sewer. These systems will be monitoring both existing and new growth areas
on the East side.
35. Heritage Impact Assessment
Professional services associated with growth-related Heritage Impact Assessments such
as peer reviews and the hiring of consultants with expertise that we do not have in
house.
3- 13
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3- 14
APPENDIX E
PUBLIC FEEDBACK
Waterloo Reaion Homebuilders Association (from Peter Armbruster
1. Projects 13 through 17 (City Share of Subdivisions, General Park
Development, Major Park Development, Community Trails and Trail Crossings) are
not identified. Although they have been broken out by subcategory, without an
understanding of where the projects are located, it is difficult to understand the
relative importance of the category overall. Comparatively, each infrastructure
project is a separate line item.
Staff response -The City has historically budgeted for these projects as single line
items, as opposed to detailing the work that each of these projects will be undertaking
each year. City staff have a detailed list of all of the work that will be done and funded
by these accounts. A detailed list of expenses incurred in these accounts is presented
to the Homebuilders when they receive their Development Charge Reserve Fund update
for the year.
2. With regard to Project Requirement - it could be argued that many of the
infrastructure projects are required under legislation (a 15 point score) to ensure
that the city is in compliance with the Provincial Policy Statement as it relates to
the supply of residential units.
Staff response -The City of Kitchener currently satisfies the housing supply
requirements under the Provincial Policy Statement (PPS). The PPS directs that
sufficient land shall be made available through intensification and redevelopment and, if
necessary, designated growth areas, to accommodate an appropriate range and mix of
employment opportunities, housing and other land uses. If the matrix were to be
revised to give more weight to these PPS provisions, projects within the built up areas
would receive a higher ranking, as opposed to projects within Greenfield areas.
3. With regard to the Financial Impact evaluation, how do engineering studies
create DC revenue greater than the cost of the project while planning studies do
not? Studies don't generate DC revenue, the infrastructure in the ground delivers
potential for revenue generation....same goes for tax revenue.
Staff response -Engineering studies indirectly lead to development charge revenue and
tax revenue, but to be consistent with the comparator planning studies, these scores
have been removed from engineering studies. This changes the overall ranking for
engineering studies, but it still remains in the projects which are above the line.
4. Line 4.2 (Project will create DC revenue less than cost of project) does not
appear to have been used.
Staff response -This is correct. None of the projects analyzed qualified to receive a
rating for this criteria.
5. Lines 4.6 (Current 2012-2014 DC budget is less than $250k) and 4.7 (Current
2012-2014 DC budget is between $250k-$1 M) would appear to cancel each other
out. Is there a clear target for the value of the work? If so, then use such a target
and projects either meet or don't, but ranking plus/minus doesn't provide a clear
picture.
Staff response -Lines 4.6 and 4.7 are mutually exclusive. Given the limited amount of
funds available from 2012 to 2014 within the Development Charge Reserve, a higher
weighting was given to the projects that had smaller budgets as it was considered that it
may be more beneficial to spend the money on a larger number of smaller projects. In
3- 15
APPENDIX E
PUBLIC FEEDBACK
combination with other rankings, this was meant to ensure high priority, small dollar
projects receive the appropriate score within the matrix.
6. Earlier in the year there were several projects that were put off to 2019 without a
similar evaluation. Those projects should be re-evaluated to see where they
actually stand relative to some of these commitments....before adecision is made
on how to proceed.
Staff response - As part of the 2011 capital budget process, staff prioritized projects
within the Development Charge Reserve Fund forecast based on public input, Council
priorities and Council direction as per the Kitchener Growth Management Plan (KGMP)
to service priority A and B lands. Several projects were therefore deferred to later in the
ten year forecast or, in some cases, outside of the ten year forecast. Similar factors
were used in the ranking of the current projects within the matrix and it is therefore
unlikely that the projects that were previously deferred would move within the three year
window that is the focus of this prioritization exercise.
7. There is a general concern that the City has borrowed from the DC account, put
the account in deficit, intend to continue to collect money but not provide any
hard infrastructure over the next three years.
Staff response -The Development Charge Reserve Fund is currently in a deficit position
due to a combination of factors:
• By their very nature development charges are an up front cost to the City. The
City must pay to construct infrastructure first, and then receives the revenue
related to that infrastructure in future years. This results in a timing difference
between the cost to the City and the revenue to the City.
• The downturn in the economy has led to a decline in the amount of development
within the City. This decline in development has decreased the amount of
development charge revenue that has been collected by the City.
• While actual growth has not achieved the growth envisioned by the recently
completed background study, the City is still required to complete projects that
were already underway/committed to, prior to the economic decline.
• The cost of some projects has exceeded what was originally anticipated in the
background study. This means that even if development growth was at the level
expected in the background study, the revenues collected would not be enough
to offset the costs incurred to build the infrastructure required.
Although there are only three hard infrastructure projects slated to receive Development
Charge funds within the next three years, these projects make up almost 60% of the
total funds available.
3- 16
APPENDIX E
PUBLIC FEEDBACK
Kitchener Soccer Club (from Franck Hivert)
I was not involved in the ranking of these projects and I know how difficult of an exercise
it can be, however I offer the following observations/comments:
With another 5+ points, artificial turf could have made the cut.
I question why projects currently underway received a score of 10 --abetter
measurement would be to state the cost/impact of stopping an existing project.
Alternatively they could be removed from the prioritization exercise -- capital spent
would have to be adjusted accordingly.
o Staff Response: Each year staff review their capital program and prioritize
projects. In general, the projects that are currently underway are ones that
are a high priority and therefore should be continued. Stopping these
projects may have cost implications since contracts may have already been
signed with consultants, contractors, etc. The other impacts of stopping a
project were considered as part of the matrix scoring (criteria 2.1-2.6)
If you remove the 10 points existing projects received, a number of them would be
competing directly with the artificial turf project.
I also question the scores the following scores:
Delay will negatively impact current service levels
Given the growth in soccer (50% in the last 4 years), I question the 1.0 that was given for
this criteria. The number of kids under the age of 10 registering for soccer is increasingly
significantly and the new toddler program (age 3 to 5) we introduced in the last couple of
years has seen excellent growth. As they continue to enjoy the sport, we expect that
they will continue to play soccer and potentially aim to play competitive soccer. We are
forecasting a growth in competitive soccer and we are in discussion with Waterloo to
host international soccer tournaments which requires first class facilities. These
tournaments also bring in revenue to the local businesses in this area.
Loss of reputation
This received a score of 1.0. The Kitchener Soccer Club has been able to attract and
retain talented players and coaches however we have been informed that some kids and
coaches prefer to play for other clubs because the facilities are better. We need to
ensure that the largest sports club in this city supporting over 5,500 kids playing soccer
and over 900 volunteers receives the continuous support from the City of Kitchener over
the next few years. Our indoor facility is outdated and although we enjoy two beautiful
fields at Budd Park and soon to be 2 artificial turf fields at Woodside Park, the City needs
to continue to show its support in order for the Club to regain its reputation.
Address goal of strategic plan and needs identified in master plan
A score of 1.5 and 1.0 was given to these criteria respectively. I am not sure why they
were rated so low when the growth of soccer in North America is real and we have
experienced it at the Kitchener Soccer Club. Soccer is keeping kids and parents active in
the community and off the streets which I believe benefits the City of Kitchener. We are
seeing an increase in newly immigrated families signing their kids to play soccer as it is
a sport played in their home country.
Staff Response: The weightings of all the criteria were reviewed and agreed to by the
cross functional staff team. The same weightings were applied to all of the projects, so
3- 17
APPENDIX E
PUBLIC FEEDBACK
increasing the score of a particular criterion would change the scores of all projects that
qualify for that criterion. Most projects that were a part of this scoring exercise qualified
for the criteria identified above, so changing the weighting on those criteria will increase
the overall scores of projects, but will not significantly impact the relative priority of those
projects.
I did not see a criteria on impact to youth and/or next generation -- not sure if this is
covered in the strategic plan/master plan?
Staff Response: There was no specific criteria for impact to youth and/or next
generation included as part of this analysis.
I also did not see a project for a new indoor facilities in the future -- this one worries me
because tax payers are paying taxes and it is private enterprise that is stepping up to the
plate (ie Doon) to provide adequate facilities.
Staff Response: The prioritization process focused solely on projects budgeted in 2012-
2014. There are no indoor facilities contemplated in that time frame, so they have not
been included as part of this process.
All in all, the need for proper soccer facilities is increasing and the Kitchener Soccer Club
is committed to working with the City of Kitchener to meet the needs of a growing sport
and this growth is not a short term/temporary trend.
3- 18