HomeMy WebLinkAbout2012-10-15FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 CITY OF KITCHENER
The Finance and Corporate Services Committee met this date commencing at 10:05 am.
Present: Councillor S. Davey - Chair
Mayor C. Zehr and Councillors J. Gazzola, B. Vrbanovic, Y. Fernandes, K. Galloway,
P. Singh, B. Ioannidis, Z. Janecki, F. Etherington and D. Glenn-Graham.
Staff: J. Willmer, Chief Administrative Officer
D. Chapman, Deputy CAO, Finance & Corporate Services
M. May, Deputy CAO, Community Services
J. Witmer, Acting Deputy CAO, Infrastructure Services
R. Regier, Executive Director, Economic Development
R. Gosse, Director, Legislated Services & City Clerk
L. MacDonald, Director of Legal Services & City Clerk
J. McBride, Director of Transportation Services
H. Gross, Director of Asset Management
W. Malcolm, Director of Utilities
R. Hagey, Director, Financial Planning
D. Murray, Interim Director, Information Services & Technology
J. Gruenbauer, Manager, Regulatory Affairs & Supply
J. Sheryer, Assistant City Solicitor
P. Harris, Manager of Licensing
J. Billett, Committee Administrator
D. Livingstone, Committee Administrator
C. Goodeve, Committee Administrator
CAO-12-038 - MODIFICATIONS TO COUNCIL I-1185 (DOWNTOWN BANNER)
1.
The Committee considered Chief Administrator’s Office report CAO-12-038, dated September
17, 2012, recommending revisions to Council Policy I-1185 (Downtown Banner) to enable use
of banners for promotion of major exhibitions associated with City facilities, such as
TheMuseum and K-W Art Gallery.
On motion by Councillor B. Ioannidis -
it was resolved:
“That the modifications to Council Policy #I-1185 (Banner Policy) be approved in the
form shown in the appendix to Chief Administrator’s Office report CAO-12-038, which
includes:
Permitting the use of banners for major exhibitions; and,
Minor housekeeping corrections
.”
INS-12-082 - IRON HORSE TRAIL SANITARY SEWER REHABILITATION
2.
- CONTRACT PO EXTENSION
The Committee considered Infrastructure Services Department report INS-12-082, dated
September 28, 2012, recommending extension of Purchase Order # 700060 to cover
additional expenditures for the sanitary sewer rehabilitation projection at Iron Horse Trail
between Gage Street and Glasgow Street.
Mr. J. Witmer provided explanation of the cause of the additional expenditures and agreed to
provide further information on the specific alignment of the trail as it relates to the sanitary
trunk sewer and an adjacent CN rail overpass.It was also noted that the trunk sewer backs
onto commercial / industrial lands rather than residential properties; and to his knowledge
there is no indication of any impact to residential properties due to the contaminated soils. Mr.
Witmer further advised that he has asked staff going forward to seek Council’s approval firstly
when in the position of an over-expenditure wherever feasible and where there is no issue of
an undue delay in completing a project.
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 137 - CITY OF KITCHENER
INS-12-082 - IRON HORSE TRAIL SANITARY SEWER REHABILITATION
2.
- CONTRACT PO EXTENSION (CONT’D)
On motion by Councillor B. Ioannidis -
it was resolved:
“That Purchase Order # 700060 to McGillivray and Sons Contractors Limited, St.
Agatha, Ontario be increased from $283,981.31 to $329,828.91 for the additional
amount of $45,847.60 plus applicable taxes for the Sanitary Sewer Rehabilitation
Project at Iron Horse Trail; and further,
That the increase to Purchase Order # 700060 be funded through existing funds
available in the Iron Horse Trail account (Internal Order 470050 - Iron Horse Trail).”
FCS-12-166 - ORACLE VOLUME LICENSING AGREEMENT
3.
The Committee considered Finance and Corporate Services Department report FCS-12-166,
dated October 5, 2012, recommending execution of a licensing agreement with Oracle
Corporation to facilitate procurement of Oracle software and related products to support City
enterprise applications.
Mr. D. Murray responded to questions, advising that the PeopleSoft software was
subsequently acquired by Oracle and its use by the City is under a separately negotiated
agreement.
On motion by Councillor B. Ioannidis -
it was resolved
“That the Director of Supply Services be authorized to execute the Master Agreement
Acknowledgement dated 20-SEP-2012, with Oracle Corporation, adopting the terms
and conditions of the Volume Licensing Agreement negotiated between the
Government of Ontario, Ministry of Government Services – Supply Chain Management
and Oracle Corporation ULC; said form of agreement to be to the satisfaction of the City
solicitor; and,
That the Director of Supply Services be authorized to execute the Acknowledgement to
Ontario agreement, with HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO, as a
prerequisite requirement to enter into the above Master Agreement Acknowledgement
with Oracle Corporation ULC; said acknowledgement to be subject to the satisfaction of
the City solicitor; and further,
That Oracle Corporation ULC be listed as a sole source provider of software
maintenance and software support for Oracle software products that the City already
owns or may purchase during the term of this agreement.”
CAO-12-042 - LEASE FOR CHARLES & BENTON PARKING GARAGE RETAIL SPACE,
4.
UNIT #2
The Committee considered Chief Administrator’s Office report CAO-12-042, dated September
27, 2012, recommending entering into a lease agreement with Downtown Crepe Café for retail
space at 4 Charles Street East (28 Benton Street).
Mr. R. Regier advised that market rental rates for retail space range from $12. to $18. per sq.ft.
and in this case, he expressed the view that the City has achieved a good balance at an
estimated rate of $14. per sq.ft. He stated that the proposed rate achieves fair market value
for the leased space and as part of the lease agreement the tenant will be making significant
capital improvements to the benefit of the City-owned facility. Mr. Regier advised that due to
ongoing negotiations related to other City-owned facilities the specifics of this negotiated
contract are not being released at this time. Mr. Regier further noted that part of the capital
improvements to be made by the tenant is construction of washroom facilities, which without
same there is almost no viable opportunity for the City to lease the space; and this
improvement will be of benefit to the City as it will remain over the long term. It was further
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 138 - CITY OF KITCHENER
CAO-12-042 - LEASE FOR CHARLES & BENTON PARKING GARAGE RETAIL SPACE,
4.
UNIT #2 (CONT’D)
noted that at this location there are only 2 retail spaces for lease and with this agreement both
will now be occupied, generating revenues for the City.
On motion by Councillor B. Ioannidis -
it was resolved:
“That the Mayor and Clerk be authorized to enter into a lease agreement with the
Downtown Crepe Café, for the Retail Unit #2, located at 4 Charles Street E. (future
address will be 28 Benton Street), subject to the satisfaction of the City Solicitor.”
INS-12-065 - GAS RATES REDESIGN - DELIVERY & TRANSPORTATION
5.
The Committee considered Infrastructure Services Department report INS-12-065, dated
October 10, 2012, concerning proposed changes in the methods used to set gas rates,
specifically related to delivery and transportation rates. It was noted that a decision of Council
is not required at this time, pending further review as part of the annual operating budget and
subsequent proposals to change gas rates in the normal course of time.
Mr. J. Gruenbauer presented details of the redesign, advising that the proposed change
relates to expiration of costly TransCanada Piplines Limited (TCPL) long haul contracts to
transport gas from Alberta to Ontario; and therefore, it is no longer relevant or appropriate to
use the TCPL toll to set the Kitchener Utilities gas transportation rate. It was noted that to
continue generation and retention of a surplus between gas transportation revenues and costs
is contrary to the rate-setting methodology approved by the Ontario Energy Board (OEB). The
transportation of gas from supply sources to Ontario is treated on a “pass-through” basis for
OEB rate-regulated utilities, similar to the commodity purchase and resale of gas; and in order
to reduce the regulatory risk of the OEB asserting direct control over Kitchener Utilities rates it
must adopt a similar “pass through” approach to set its gas transportation rate. The redesign
will have regard to budget transparency and need for sustainable revenues and earnings. Mr.
Gruenbauer provided an overview of the approach to redesign, and customer impacts, which
are expected to be relatively neutral for the majority of customers, with some impact for larger
direct purchase commercial and industrial customers. The impacts will be managed by
phasing-in rate changes and some increases in gas delivery rates for 2013 are likely whether
or not any change in method to set rates is made, given Union Gas Limited (UGL) has applied
to the OEB for a rate increase. Mr. Gruenbauer advised that the current method to set gas
rates is not sustainable, noting that Kitchener Utilities is both a gas utility and a municipal
enterprise and its rate design should reflect that dual reality and be sustainable. It was noted
that while the current approach has served well, times and the market have changed and gas
rates should be based on the Utilities’ cost of service rather than on TCPL or UGL cost of
service. Revenues from fixed charges should recover fixed utility costs, including return on
investment and dividend, reducing weather related revenue risk. Further, the method to set
the rates should yield reasonable rates and minimize the risk of the OEB asserting control over
the rates; and any rate changes can be phased-in to yield a neutral impact for the majority of
customers.
Councillor J. Gazzola referred to a graph shown illustrating the TCPL contract quantity and
rate from 1999 to 2012, questioning that in 2006-07 when the rate began to escalate why a
change was not proposed at that time. Mr. Gruenbauer advised that Kitchener Utilities had
significantly reduced the level of TCPL contracts; however, a handful had longer terms which
necessitated waiting until expiration of those contracts. Councillor Gazzola questioned where
the City is getting its gas from if not from Alberta. Mr. Gruenbauer advised that the source is
not tracked, noting that there are a number of contracts which provide for gas delivery in
Ontario which could have come from Alberta, British Columbia and/or parts of the United
States. It was noted that TCPL tolls have increased due in part to cheaper alternatives
provided across the border and loss of shipping contracts has driven up TCPL tolls as their
costs have had to be distributed over fewer shippers. At the request of Councillor Gazzola, Mr.
D. Chapman agreed to provide further clarification in respect to the cost advantage enjoyed by
Kitchener Utilities relative to property taxation. Councillor Gazzola questioned the ability to
remain profitable if the Utility was regulated by the OEB. Mr. Gruenbauer expressed concern
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 139 - CITY OF KITCHENER
INS-12-065 - GAS RATES REDESIGN - DELIVERY & TRANSPORTATION (CONT’D)
5.
in respect to what would happen to the City’s dividend which in such instances would be
measured by the OEB. He added that the return on dividends depends on how profit is
measured and what assumptions are made, and the methods used by the OEB may be
different.
Councillor P. Singh requested clarification of the impact to residential customers who use more
than the average consumption if the model is changed. Mr. Gruenbauer reiterated that the
proposed change is designed to be neutral for the majority of customers.
Councillor D. Glenn-Graham questioned if the City would receive any advance warning in the
event the OEB was to intervene and how the City ensures it remains in a favourable position.
Mr. Gruenbauer advised that staff monitor activities of the OEB and have OEB contacts that
are regularly consulted. He stated that to his knowledge the OEB remains silent in respect to
taking over regulation and the City is attempting to do as many improvements as they can on a
voluntary basis which the OEB is made aware of. Mr. Gruenbauer advised that the best
defence is to control the City’s rate in similar rate-making principles to the OEB. Councillor
Glenn-Graham requested further clarification regarding applications made by Union Gas. Mr.
Gruenbauer advised that Union Gas has filed several applications this year, the largest of
which is their proposed increase for 2013. He noted that this is the first time in 5 years they
have gone to the OEB with an extensive cost of service filing and if those rates are approved
the City’s rates will be impacted. Mr. Gruenbauer advised that the City has been involved in
the process, which has gone to a hearing and the matter is now in the Board’s hands.
Councillor Z. Janecki questioned if the City is tapping into lower pricing in the US markets. Mr.
Gruenbauer advised that this is the reason the City is de-contracting with TCPL to allow the
Utility to diversify and potentially buy in to US markets. Councillor Janecki referred to the TCPL
chart, questioning where it is envisioned how this will look in 2013. Mr. Gruenbauer advised
that it is not anticipated that the City will contract further with TCPL unless there is a dramatic
change in pricing to bring them into a more competitive position. It is assumed that the City
will be bringing gas in to the Windsor/Sarnia storage facility and where the gas comes from will
be up to the suppliers based on terms of contract. Councillor Janecki requested clarification in
respect to references made to an increase in the range of 6 to 22% and was advised that the
impact of the redesign may not be neutral for some direct purchase customers, who may face
an increase in delivery rates and who are primarily commercial and industrial users who buy
and transport gas directly.
Mayor C. Zehr questioned if this plan deals with the commodity component in terms of
restructuring of the rate structure. Mr. W. Malcolm advised that a further report is pending,
noting that staff will be following up on spot market purchases versus future advance gas
purchases. He anticipated that the report will come forward in the spring 2013. Mayor Zehr
questioned the timeline for implementation as it relates to those who may be subject to an
increase. Mr. Malcolm advised that if the redesign is accepted, staff will look at each customer
that may be subject to the 6 to 22% increase and after a period of monitoring if necessary seek
Council’s approval for an increase. Mayor Zehr referenced the principles involved in setting
rates at it relates to the OEB, recalling discussions with the Ministry in 2000 when regulatory
changes were made during which the City’s approach was layed out. The City made known
that they would not encroach into Union Gas territory and would work closely to stay within the
market rates to have a level playing field. He questioned if the point of needing to work closely
on market rates and within OEB guidelines is to ensure that the City does not lose benefit of a
deregulated Utility and Mr. Gruenbauer concurred. Mayor Zehr cautioned Council not to loose
sight of this when the time comes to set rates.
Councillor Y. Fernandes questioned if the City will see a reduction in revenues due a decrease
in transportation costs. Mr. Gruenbauer advised that a reduction is not expected in cash flow
or overall revenues, noting that a reduction in transportation rates is to be off-set by an
increase in delivery rates in order to achieve a level playing field.
Councillor B. Vrbanovic requested that at the time the proposal comes forward for Council’s
decision he would like to see a communications strategy that will provide understanding of the
redesign in as simple language as possible for the benefit of the community.
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 140 - CITY OF KITCHENER
FSC-12-142 - RECORDING AND POSTING COUNCIL AND STANDING COMMITTEE
6.
MEETINGS TO THE CITY’S WEBSITE
The Committee considered Finance and Corporate Services Department report FSC-12-142,
dated July 31, 2012, concerning the feasibility of recording Council meetings over and above
those already recorded by Rogers TV, as well as all Standing Committee meetings.
Ms. Cassandra McKenna, student, spoke in favour of having recorded Council meetings
available on-line as a tool to engage citizens, noting that it provides opportunity for persons to
view matters of interest at their convenience and is more transparent in providing a complete
account of what took place. She asked that the City pursue a form of editing that will allow an
individual to immediately view an item of interest as opposed to having to advance through the
entire recording to find an item. She added that it is important that availability of this service be
communicated to the community, noting that she only became aware through one of her
classes that Council meetings recorded by Rogers TV are subsequently available for viewing
on the City’s website. Ms. McKenna expressed the view that notwithstanding budgetary
issues, providing funding now to achieve the desired result would be worth the cost and if not
done, is likely to cost more in future. She asked that Council also carefully consider the
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question of who will own the content if a 3 party provider is used.
Mr. C. Goodeve advised that the report is a follow-up to a presentation made to the Committee
in March 2012, at which time staff was asked to investigate the best means to record
meetings, as well as what broadcast production quality would best be implemented. 2 areas
were investigated with the first being an in-house solution that would require the purchase of
equipment for video editing at a cost of approximately $18,000., with the largest cost attributed
to the purchase of an encoder. Mr. Goodeve noted that the initial estimate of costs does not
include ongoing maintenance, training of staff and/or future upgrades/replacement of
equipment. A plan for same would still have to be developed by staff. The second area of
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investigation was use of a 3 party video hosting service and several providers have been
identified as capable of supplying packages specifically designed to meet the City’s needs.
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Mr. Goodeve pointed out that with a 3 party provider there would be no upfront costs for
hardware and ongoing technical support would be available based on an annual retainer
ranging from approximately $7,500. to $10,000. He noted that investigations also indicate that
ownership of the content would remain with the City and staff would ensure that ownership
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rights are clearly specified in any agreement entered into with a 3 party service provider.
Mr. Goodeve pointed out that of over 20 municipalities surveyed as part of the Background
Study, each was identified as either having their web-streaming delivered through their local
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cable provider or uploaded through a 3 party service provider.Mr. Goodeve advised that it
has been determined that a broadcast quality similar to Rogers TV is feasible to implement for
recording Council meetings. Currently 2 Legislated Services staff attend Council meetings and
with reduced hand written transcription of minutes, one of the staff can be reassigned to
operate the six cameras. A single camera approach is proposed for Standing Committees
which will capture one static view of the proceedings and it is proposed that the Committee
Administrator attending the meeting would be responsible to activate the system prior to the
meeting, as well as de-active at its conclusion. Mr. Goodeve advised that this approach
provides the most cost effective means to record meetings as it involves minimal amount of
staff interaction with the equipment; adding that to do otherwise will require additional staff
resources. Mr. Goodeve advised that in the event a decision is made to pursue on-demand
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webcasting of recorded meetings, staff is recommending the City use a 3 party service
provider, and is seeking direction to proceed with development of tender specifications to
enable commencement of the tender process.
Councillor P. Singh inquired how archival of recorded meetings would be handled. Mr.
Goodeve advised that this can be done in several ways, such as sending a copy of the DVD
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recording to the 3 party provider as a back-up and the web file that will be edited could be
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saved for long term retention. He added that the 3 party provider has available storage space
and several offer unlimited space that could be used to retain the recordings for whatever
retention period is established by the City. Mr. Goodeve also advised that the editing process
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is intended to be done in-house as there is additional fees associated with having a 3 party
provider complete the task. He pointed out that the Committee Administrator in attendance to
record meetings will have an easier time determining the start and end times of each item
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 141 - CITY OF KITCHENER
FSC-12-142 - RECORDING AND POSTING COUNCIL AND STANDING COMMITTEE
6.
MEETINGS TO THE CITY’S WEBSITE (CONT’D)
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discussed and less editing time will expedite on-line availability; whereas, a 3 party provider
will have to view the entire video to make such determinations. He added that reduction in
minute content would be off-set by the in-house editing process and given a simplified web
based interface, it is expected to be user friendly for staff. Councillor Singh questioned what
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the Region of Waterloo is currently doing and Mr. Goodeve advised that the Region uses a 3
party provider, implemented at a cost of approximately $120,000. He pointed out that the
Region’s costs included installation of cameras, whereas the City already has cameras in
place. Councillor Singh questioned if conversion to parliamentary style minute taking would
off-set costs. Mr. Goodeve advised that at this time it is difficult to quantify, noting that the time
it takes for editing cannot be determined until staff have had an opportunity to try out the
editing process and staff will still be producing minutes although they will not be as detailed.
He added that while some savings in time is expected this could provide opportunity for
Legislated Services staff to take on other Advisory Committees that they have not been able to
assume responsibility for given limited resources.
Councillor J. Gazzola questioned where the up-front costs are to be funded from. Mr.
Goodeve advised that currently projected costs are unbudgeted, necessitating consideration
as part of the 2013 budget deliberations and at that time he expected potential funding sources
would be identified. Councillor Gazzola questioned the impact of utilizing all cameras for
Standing Committee meetings. Mr. Goodeve advised that additional staff resources would be
required; whereas, if a single camera approach is taken, all that would be required is for the
Committee Administrator to set-up the system ahead of the meeting and deactivate at its
conclusion. He added that to do this in house the City would need to purchase an encoder
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together with other relevant equipment/software; or alternatively, retain a 3 party service
provider.
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Councillor Y. Fernandes questioned the expected term of an agreement if a 3 party provider
was used, raising concerns as to the ability to change providers if not satisfied. Mr. Goodeve
advised that most municipalities have contracted from between 3 to 5 years and ability to
change providers would be dependent on the term of the contract agreed to.
Councillor B. Vrbanovic noted that Rogers TV currently uses volunteers throughout their work,
except within their main control room. He questioned the feasibility of using student volunteers
to allow all six cameras to be operated for Standing Committees, potentially at less or no costs.
Mr. Goodeve advised that currently the Rogers equipment utilized by the City operates from
one centralized control room. He noted that volunteers working with Rogers primarily operate
remote cameras and for Council meetings that are recorded by Rogers, it is a Rogers’
Production Supervisor who operates the cameras from the central control room. Mr. Goodeve
stated that Rogers has indicated that they would not be comfortable allowing anyone other
than one of their employees or trained City staff to operate their equipment and under the
City’s User Agreement with Rogers they have the final say as to who is permitted to utilize the
equipment.
On motion by Councillor P. Singh, the staff recommendation in report FCS-12-142 was brought
forward for consideration to provide that subject to 2013 budget deliberations, a $10,000.
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allocation be made annually to the Legislated Services Division operating budget for a 3 party
video hosting service for on-demand webcasts of Council and Standing Committee meetings;
and to direct staff to develop tender specifications to facilitate commencement of the tender
process; and that Rogers TV broadcast production quality be used for Council meeting
webcasts and a single camera quality be used for all Standing Committee meeting webcasts.
A motion by Councillor J. Gazzola was brought forward for consideration to amend Councillor
Singh’s motion to provide that the $10,000. allocation not be subject to 2013 budget
deliberations but rather be funded from surplus funds within the Communications Division
operating budget.
Councillor Gazzola suggested that this is more of a communication effort and the
Communications Division budget is projecting a $22,000. surplus which could provide the
funds from within an existing budget and allow the project to move forward now.
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 142 - CITY OF KITCHENER
FSC-12-142 - RECORDING AND POSTING COUNCIL AND STANDING COMMITTEE
6.
MEETINGS TO THE CITY’S WEBSITE (CONT’D)
Mr. J. Willmer advised that while there may be surplus funds in the Communications Division
budget, he would like opportunity to review the budget to determine if it is reasonable to fund
the project from within their budget and would provide more details to Council prior to a final
decision being made on October 22, 2012.
Councillor Vrbanovic expressed support for the motion, commenting that this project will help
promote transparency, as well as raise awareness in the community by providing a full account
of debate, and it was his opinion it should move forward sooner than later. He added that he
would like more information from staff as to potential funding sources, which could involve a
combination of Divisional budgets as opposed to one and it was his desire to see this happen
within existing budgets if possible.
Mayor C. Zehr questioned if the amendment was to be accepted as friendly or if it was
intended to be voted on separately, advising that if voted on separately he would like to move
deferral of the amendment until the additional information is received from staff regarding
potential funding sources.
Councillor Singh requested clarification if the intent is for the associated costs to be funded
permanently from within the Communications Division budget or as a one time expenditure.
Councillor Gazzola advised that it was his intent that the allocation be approved from within an
existing budget to allow the project to move forward, subject to staff providing more specific
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details on funding options prior to the October 22 Council meeting.
Carried Unanimously
The following motion was , on a recorded vote.
On motion by Councillor P. Singh -
it was resolved:
“That $10,000. be allocated annually to the operating budget to accommodate third
party video hosting services for on-demand webcasts of Council and Standing
Committee meetings, subject to additional information from staff on potential funding
sources from within existing Divisional budgets; and,
That staff be directed to proceed with development of tender specifications for third
party video hosting services to facilitate the provision of on-demand webcasting, as
outlined in Finance and Corporate Services Department report FCS-12-142, and on
completion of the written specifications to commence the tendering process; and further,
That staff endeavour to provide a Rogers Television broadcast production quality for
Council meeting webcasts and a single camera broadcast production quality for all
Standing Committee webcasts.”
FCS-12-168 - LIQUOR LICENCE REVIEW APPLICATION - CAESARIA INC.
7.
- 320 KING STREET WEST
The Committee considered Finance and Corporate Services Department report FSC-12-168,
dated October 1, 2012, concerning an application for an Ontario Liquor License by Caesaria
Inc. for the property known municipally as 320 King Street West.
Mr. Mark Grossman, Solicitor for the applicant, advised that his client has concerns with regard
to Conditions 4 and 5 of the staff recommendation. He noted that staff have indicated
concerns regarding his client’s business experience and advised that his client does have
experience having managed and operated a bar and grill restaurant in Israel for a period of 2
years and has also operated businesses in Canada since arriving in 2010. In respect to
Condition 4, he stated that his client is suggesting that the closing time of 12:01 a.m. be
imposed only until May 1, 2013 rather than the first full year, and thereafter, be allowed to
remain open on Fridays and Saturdays until 2:00 a.m. on condition that no problems have
arisen within the probationary period. This would allow his client to prove he is a responsible
business owner and should problems become evident then the closing time of 12:01 a.m.
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 143 - CITY OF KITCHENER
FCS-12-168 - LIQUOR LICENCE REVIEW APPLICATION - CAESARIA INC.
7.
- 320 KING STREET WEST (CONT’D)
would remain in place. In respect to Condition 5, his client is asking that washrooms not be
excluded from the licensed area for reasons of safety and security for female patrons. He
explained that there is concern of leaving drinks at the table where they could be open to
tampering while visiting the washroom. Mr. Grossman also spoke to Condition 6 advising that
his client has no connection to the previous owner and will be operating completely at arms
length with no involvement from the previous owner. Mr. Grossman advised that his client is in
agreement with the staff recommendation, save and except Conditions 4 and 5, and subject to
the changes requested his client is willing to enter into an agreement with the City.
Councillor B. Vrbanovic commented that it is the City’s normal practice to impose a 12:01 a.m.
closing for the first year and questioned if Mr. Grossman’s client understands that if not willing
to enter into the agreement the City’s position may then be to oppose the license in its
comments going forward to the Alcohol and Gaming Commission of Ontario (AGCO). Mr.
Grossman acknowledged his client knows this could be the case and suggested that his client
either be allowed to extend hours of operation in May 2013 as requested, or be permitted to
return to Council in early spring to request an amendment on the basis of good performance.
Councillor Vrbanovic suggested that the alternative of returning to Council to request an
amendment should become part of the recommendation as this would be the only means for
Council to have opportunity to further comment.
On motion by Mayor C. Zehr, the staff recommendation contained in report FCS-12-168 was
brought forward for consideration to not oppose the application for a liquor license, as
amended by modifying Condition 4 to stipulate that the 12 month period begin at
commencement of the business operation as opposed to when the license is issued; and
rather than at the end of the 12 months the applicant return to Council prior to expiration of the
trial period for comment. Mayor Zehr further advised that he was not in agreement with
allowing washrooms to be included in the licensed area.
Councillor Vrbanovic commented that the issue of the washrooms is somewhat sensitive and
questioned how the AGCO views same in general across licensed establishments. Ms. P.
Harris advised that she would have to contact the AGCO for clarification on this issue.
Councillor Vrbanovic advised that he supports the amendments proposed by Mayor Zehr,
noting that notwithstanding the applicant has no ties to the previous owner there have been
serious issues in the past at this site and there is need to ensure protection of area residents
and patrons to the downtown.
Councillor J. Gazzola questioned if there is a mechanism to deal with establishments already
licensed where problems have arisen. Ms. J. Sheryer advised that submission of a liquor
license application to the AGCO is the one opportunity for Council to comment and once
granted, any process for change is under authority of the AGCO. The City can, however,
through the business license request a hearing if concerns of the operation arise and at time of
hearing, the decision can be made to impose conditions and/or revoke the business license.
Mayor Zehr noted that the recommendation of this Committee is intended to go to special
Council the same date and in light of the need to receive additional information regarding the
washrooms questioned if there is any reason that this matter could not be deferred for one
week. Mr. R. Gosse advised that staff would have no issue in removing “washrooms” from the
list of areas excluded from the license, noting that the intent was only to ensure that the
licensed area does not extend to the back portions of the facility. Ms. Harris advised that there
is urgency in proceeding with this matter as the AGCO is in position to issue the license and
requires the City’s comments as soon as possible. She stated that a decision is necessary in
order for the City not to lose opportunity to impose conditions on the license. Mayor Zehr
questioned if the condition as written is consistent with all other applications. Ms. Harris
advised that this is in fact the first time that washrooms have been included in the condition.
Mayor Zehr advised that on that basis he would agree with removing the word “washrooms”.
Following further discussion concerning ability to have the applicant return to Council for
comment in respect to change of conditions, Ms. Sheryer advised that once granted requests
for change are under authority of the AGCO. Ms. Sheryer suggested that the phrase “for the
FINANCE AND CORPORATE SERVICES COMMITTEE
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FCS-12-168 - LIQUOR LICENCE REVIEW APPLICATION - CAESARIA INC.
7.
- 320 KING STREET WEST (CONT’D)
first full year of operation” be removed from Condition 4 so that the closing time of 12:01 a.m.
will apply continuously until such time as a change is requested and approved. She further
advised that the AGCO can consider a request by the applicant for change at any time and
while the AGCO has no obligation to consult further with the City, given past experience it is
likely a request for comment would be received by the City if a change is requested. Mayor
Zehr questioned if reference should be made in respect to the liquor license application to tie
into the business license. Ms. Sheryer advised that in such instance, in order to hold a hearing
it would have to be a business related matter.
Councillor S. Davey clarified that the amendments to the motion as now proposed are to
remove the phrase “for the first full year of operation” from Condition 4 and to remove the word
“washroom” from Condition 5; and Mayor Zehr concurred.
Councillor Gazzola requested that Condition 4 be voted on separately, commenting that he did
not like the connotation that the applicant is guilty before being given an opportunity to
demonstrate their business expertise and in particular, noted the importance of the first year in
getting a business up and running. He suggested that the City has opportunity through the
business license to address issues should they arise and the applicant should be given the
same opportunity as any other business establishment.
The following motion was voted on in 2 separate parts, by recorded votes, as follows:
Carried
Condition 4 -
In Favour: Mayor C. Zehr and Councillors B. Ioannidis, S. Davey,
K. Galloway, B. Vrbanovic, F. Etherington and P. Singh.
Contra: Councillors J. Gazzola, D. Glenn-Graham, Z. Janecki
and Y. Fernandes.
Carried Unanimously
Balance of Motion -
On motion by Mayor C. Zehr -
it was resolved:
“That Council not oppose the application for a liquor license for Caesaria located at 320
King Street West, applied for by Caesaria Inc. (herein referred to as the “Applicant”),
subject to the applicant entering into an agreement with the City including certain
conditions of operating a licensed establishment as follows:
1. to post in a conspicuous place and abide by the Downtown Licensed
Establishments Code of Conduct;
2. to become a member of the Kitchener Business Improvement Area’s License and
Entertainment Committee and attend its meetings;
3. to abide by a set 40% monthly ratio of alcohol sales to gross refreshment sales
(including food and other sundries) in other words alcohol sales will be limited to
40% of gross refreshment sales;
4. to stop serving alcohol by 12:01 a.m. daily;
5. that only the main floor restaurant/lounge area, comprising 2,550 square feet with
an occupant load of 180 persons and tables set for approximately 70 persons, be
licensed and that the licensed area shall exclude the back parking area,
basement, kitchen and any office space living or otherwise;
6. not to have the individual(s) owning 320 King Street West on October 15, 2012
work at the licensed establishment, either as management or employees of the
business;
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FCS-12-168 - LIQUOR LICENCE REVIEW APPLICATION - CAESARIA INC.
7.
- 320 KING STREET WEST (CONT’D)
7. to notify the Clerk of the City of Kitchener in writing of any application to change
the license at the time the application for the change is made to the Alcohol and
Gaming Commission of Ontario and not to expand the establishment without the
consent of the City’s Council;
8. to comply with the Noise By-law and the Smoking By-law;
9. these conditions shall bind all successors, assigns and subsequent licence
holders (if any); and,
That the Mayor and Clerk be authorized to enter into an agreement with the applicant
and to request that the conditions be added to their licence if the Alcohol and Gaming
Commission of Ontario (AGCO) chooses to issue the licence; and further,
That in the event the applicant does not agree to the recommended conditions the
Alcohol and Gaming Commission (AGCO) be requested to hold a hearing with respect
to the licence and grant the City party status.”
FCS-12-167 - DISCRETION REGARDING LICENSING FEES
8.
The Committee considered Finance and Corporate Services Department report FCS-12-167,
dated September 28, 2012, which provides clarification of the application of Chapter 549 of the
Municipal Code and the discretion staff uses in determining a lesser license fee.
Councillor J. Gazzola commented that this information report resulted from an earlier request
from the Cherry Park Neighbourhood Association for a reduced license fee associated with an
annual fair organized by the Association. He suggested that this event should not be viewed in
the same context as similar events held at convention centres or hotels conducted by
professional organizers, noting that this event was run by the volunteer community group who
is attempting to get a community activity going and if successful, more bookings are likely to be
made. He stated that he did not want to see them lose exemption from the license fee. Ms.
Harris advised that she does not exempt fees and could not apply a reduced fee for the
Neighbourhood Association because they are operating their festival in similar manner to
events held at Bingemans wherein vendors pay for a table and all sale proceeds go back to
the vendor rather than to a charitable organization. She stated that this is no different from
events held at convention centres where all profits are going back to the vendors and in the
case of the Cherry Park festival, they had 70 vendors, all of whom were making a profit from
the event. Ms. Harris advised that this was the reason she could not apply the reduced
charitable license fee and subsequently, the organizers appealed to Council for a fee
reduction.
Councillor F. Etherington questioned if the festival organizers will have to again request a
reduction in the license fee next year, commenting that he had thought this report had to do
with an ad hoc method of waiving the fee. Ms. Harris reiterated that she does not waive the
license fee but rather reviews each application to determine if it is an event run by a charitable
organization wherein all proceeds go to a charity and considers whether or not the reduced
charitable license fee can be applied. She stated that unless all proceeds of the event go to a
charity it is not considered a charitable event and the full fee is applied. Ms. Harris advised
that the Cherry Park festival is not considered a charitable event and should the group again
appeal to Council, it would be Council’s decision whether or not to apply a reduced license fee.
This meeting temporarily adjourned at 1:05 pm and reconvened at 2:38 pm with all members present.
FCS-12-163 - ENVIRONMENTAL COMMITTEE RECOMMENDATION
9.
- WATERLOO REGION GREEN SOLUTIONS (REEP)
ANNUAL FUNDING REQUEST
The Committee considered Finance and Corporate Services Department report FCS-12-163,
dated September 21, 2012 regarding a recommendation from the Environmental Committee to
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FCS-12-163 - ENVIRONMENTAL COMMITTEE RECOMMENDATION
9.
- WATERLOO REGION GREEN SOLUTIONS (REEP)
ANNUAL FUNDING REQUEST (CONT’D)
support a request for funding in the amount of $27,500. from Waterloo Region Green
Solutions, Residential Energy Efficiency Project (WRGS - REEP).
Ms. Mary Jane Patterson, Executive Director, REEP, attended in support of their annual
funding request, highlighting the organization’s focus for 2013. Ms. Patterson advised the
organization would continue Energy Efficiency, Water Stewardship, and supporting both of
these goals through the REEP House activities. She provided information on benchmarks
including the installation of lighting upgrades in 97 homes in Kitchener under the Home
Assistance Program, working with GreenSaver. Ms. Patterson advised that going forward,
REEP will be exploring an emerging approach to home retrofits with other green communities
across Canada; and with regard to the RAIN program, REEP is working closely with the City’s
new stormwater utility and communications staff, to dovetail their activities to support the new
credit program. She added that the REEP House continues to attract over 1,000 people each
year through workshops, open houses and tours, and hosts a number of the RAIN activities.
She noted that the REEP House project is continuing as they are in the midst of adding solar
water heating panels to the roof, which will be completed by spring 2013.
Ms. Priyanka Lloyd, Development Manager, REEP, provided information on Community-Scale
Retrofits (CSR) with Innovative Financing. She explained rather than focusing on a large
geographic area for a long period of time to retrofit one house at a time, CSR targets a
neighbourhood or community for a short duration to transform the area’s housing stock. She
advised that rather than utilizing mass marketing, CSR leverages local community leaders,
word-of-mouth testimonials from community early adopters, and partnerships with local
organizations to create visibility and action. Accordingly, CSR coupled with innovative
financing mechanisms can lead to 30-50% energy efficiency improvements in homes versus
the 10-30% that have historically been seen with traditional retrofit approaches. She indicated
that two of the most promising financing mechanisms are on-bill financing and property
assessed payments for energy retrofits (PAPER). She noted that both of these financing
mechanisms differ from traditional grants or rebates in that they cover the entire cost of the
retrofit for the homeowner, with the cost repaid by the homeowner at a low interest rate. She
noted that financing can be structured to cover the deeper level of retrofits needed to see real
efficiency gains.
Ms. Patterson referred to the estimated 2013 Budget included in the staff report as Appendix
‘A’. She noted that REEP’s draft budget for 2012 at this time last year was for about $600,000,
but with the addition of the RAIN activities, it has ended up being closer to $900,000. She
explained that the 2012 core support from the City of Kitchener was leveraged to bring the $1
million RAIN program to Kitchener offering a value of $6 to the community for every $1 the City
provided. She noted that this year’s funding is approximately ¼ client fees, ¼ local funding,
and ½ provincial, federal and other revenue sources.
Councillor B. Vrbanovic inquired as to the legislative status of the Community Scale Retrofit
Program in Ontario. Ms. Lloyd responded that the provincial government has put forth
proposed amendments to the Local Improvement Charges (LIC) regulation of the Ontario
Municipal Act that would allow municipalities to finance energy retrofits on private property
using the LIC mechanism.
Councillor J. Gazzola asked for clarification of the PAPER financing option relative to the
Community Focus Retrofit Program. Ms. Lloyd responded that there are two types of financing
options available, which offer repayment on the utility bill or tax bill, with a financing period of
10 to 20 years. She clarified that property taxes are not affected; rather, the special
assessment is added to the property tax bill for repayment of the retrofit funding.
Councillor Gazzola referred to REEP’s estimated 2013 Budget, and inquired if the federal and
provincial governments would be providing funding. Ms. Patterson responded that the federal
government is no longer providing additional funding for the ecoEnergy Program for energy
retrofits. She added that incentives through the Ontario Home Energy Audit Program ended in
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FCS-12-163 - ENVIRONMENTAL COMMITTEE RECOMMENDATION
9.
- WATERLOO REGION GREEN SOLUTIONS (REEP)
ANNUAL FUNDING REQUEST (CONT’D)
March 2012. Councillor Gazzola also inquired if the City of Waterloo contributes to REEP.
Ms. Patterson responded that Waterloo North Hydro contributes funding, but not the City of
Waterloo.
Councillor Vrbanovic referenced the Community Scale Retrofit Program and PAPER financing
and requested clarification on the advantages of using LIC’s rather than a traditional loan
program. Mr. D. Chapman advised that the cost of the improvements can be added to the tax
bill as a special assessment similar to traditional LIC’s; however unlike traditional LIC’s,
Community Scale Retrofit improvement charges would not require unanimous consent of all
property owners.
Carried Unanimously
The following motion was then voted on and by all members present.
On motion by Councillor B. Vrbanovic -
it was resolved:
“That subject to the 2013 budget deliberations, $27,500. be allocated to the Waterloo
Region Green Solutions, Residential Energy Efficiency Project (REEP), as part of the
Environmental Committee’s 2013 Operating Budget.”
CAO-12-043 - COMPASS KITCHENER LEAF COMMUNITY CONSULTATION RESULTS
10.
The Committee considered Chief Administrator’s Office report CAO-12-043, October 4, 2012,
which provides an overview of the results received by Compass Kitchener’s public consultation
on the potential allocation of the $3M remaining in Local Environmental Action Fund (LEAF).
Mr. Theron Kramer, Chair of Compass Kitchener, detailed the results of the LEAF public
consultation, noting that only those members who did not wish to individually express a
preference for how LEAF funds were used, were asked to participate on the sub-committee
that undertook the public consultation process. To that end, Compass Kitchener lead a public
consultation process seeking feedback from the community on how much of the $3M should
be allocated to one or more of the following five options:
1. Development of Parks and Trails;
2. Eradication of the Emerald Ash Borer;
3. Maintaining the LEAF granting fund;
4. Preservation of Hidden Valley; and,
5. Other.
Mr. Kramer outlined that of the 279 participants, 245 respondents recommended that the funds
be allocated to the various options, as follows: 66% voted for Development of Parks & Trails;
56% to Preserve Hidden Valley; 42% to Eradicate Emerald Ash Borer; 38% to
Maintain/Redesign LEAF; and, 20% voted for ‘Other’. He added that respondents could vote
for one or more options; however, the results cannot be generalized to represent the entire
City population as they were not compiled through a random survey. He advised that the
recommendations contained in the report were determined to find a balance of all options
recognizing that not everyone would be satisfied. He noted that the majority of respondents
sought connectivity in trails and the development / preservation of natural areas. He added
that Compass Kitchener is a citizen group focused on environmental engagement which
presents a slight bias; the group felt that by adding more funds to the Community
Environmental Improvement Grant (CEIG) program would encourage and promote
transformational environmental projects through citizen engagement.
Councillor B. Ioannidis requested clarification on what was meant by the implied “bias” of
Compass Kitchener when contemplating the recommendations. Mr. Kramer advised that any
bias mentioned stems from the importance of community engagement, which he feels is
reflected in the data. In reference to the recommendations contained within the report, he
noted that although fewer participants allocated funds to preserving Hidden Valley than to
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CAO-12-043 - COMPASS KITCHENER LEAF COMMUNITY CONSULTATION RESULTS
10.
(CONT’D)
developing Parks and Trails, 136 compared to 162; significantly more respondents
demonstrated their passion for this option by suggesting the full $3M should be allocated to
preserving Hidden Valley. He added that with regard to the Emerald Ash Borer (EAB), the
majority of respondents supporting this option saw it as necessary, but wanted to support other
options as well; even though the background information on this option made it clear that
spending the full $3M would not address the total need for eradicating the EAB.
In response to questions regarding allocation of funds to the CEIG, Mr. Kramer responded that
it was determined during the public consultation process that very few people were aware of
the existing grant program. When asked if Compass Kitchener considered a loan program
with the LEAF funds for sustainable initiatives, Mr. Kramer indicated that not a single
respondent conveyed an interest in LEAF to become a loan program.
Several members inquired as to the background information made available to the public for
consideration during the consultation process. Mr. Kramer confirmed that a three or four page
“backgrounder” was available on each option prior to filling out the allocation chart. Mr.
Kramer referred to the background information, noting that the Hidden Valley backgrounder
references the River Road extension, the land-use planning documents as well as the
development applications. When asked if land values were referred to in context of the current
status, or future development status, he indicated that land values were not mentioned in the
Hidden Valley backgrounder. He also confirmed the Parks & Trail backgrounder contained
information from the City of Kitchener Parks Strategic Plan.
Mr. Gord Nicholls attended on behalf of the Friends of Hidden Valley to request that the
Committee consider alternate recommendations to those provided by Compass Kitchener to
better represent the fulfillment of the top five environmental priorities. His recommendations
included utilizing the LEAF funds to purchase Hidden Valley lands; development of a new
natural area; and, to complete the community trails system. Mr. Nicholls provided an analysis
of the Compass Kitchener results that weighs the four options presented, maintaining LEAF
excluded on the assumption that LEAF would be discontinued, against the top five
environmental priorities identified by the respondents.
Councillor B. Vrbanovic acknowledged Mr. Nicholls analysis and commented that his
recommendation to commence the process to purchase the land now is premature as the
value of the land has not been determined, nor have the boundaries of the endangered
species protection area been finalized. Councillor Vrbanovic added that if the land is
purchased before the environmental assessment (EA) is completed the land would be worth
significantly more to the developer than if the EA demonstrates the road extension cannot take
place. Mr. Nicholls commented that Friends of Hidden Valley are the only group that has come
forward with a large transformational project that will increase the park inventory of the City
while utilizing the LEAF funding in a way that will leave a legacy. He continued that the other
options debated will absorb the funds as they will only contribute financially to a more
expensive project.
Councillor Y. Fernandes spoke to the recommendation put forward by Compass Kitchener to
transfer $1M in LEAF funding to the Community Environmental Improvement Grant (CEIG)
program, which is administered by the Environmental Committee. She stated that
notwithstanding the efforts of the Environmental Committee as well as Environmental Planning
staff, interest in the CEIG program has been waning in recent years. She noted support for the
intent of the recommendation to bolster the program, but expressed concerns regarding the
potential future uptake of interests in those grants.
A motion was brought forward by Councillor Fernandes to allocate $2M in LEAF funding
toward purchasing the Hidden Valley lands and preserve it as a natural area as well as
improving the Grand River Heritage Trail system. In addition, she put forward that the
remaining $1M in funding be applied toward enhancing the City’s existing trails and natural
areas.
Several members indicated that while they support the preservation and acquisition of natural
areas, it would not be prudent at this time to move forward with purchasing Hidden Valley;
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 149 - CITY OF KITCHENER
CAO-12-043 - COMPASS KITCHENER LEAF COMMUNITY CONSULTATION RESULTS
10.
(CONT’D)
particularly given the City would likely acquire a portion of those lands at no cost through future
development proposals. In addition, it was highlighted that it was contrary to the City’s best
interests to commence negotiations to purchase those lands in a public forum.
Councillor S. Davey clarified that contrary to what is indicated in the Compass Kitchener
report, unanimous support was not given for Compass Kitchener to undertake the public
engagement process on how the remaining LEAF funding should be allocated. He stated that
while he respects the work that has been done by that Committee, he is unhappy with the
results. He then referred to the substantial future allocation that will be needed to mitigate the
effects of the Emerald Ash Borer, noting that the City has already commenced several different
projects without sufficient funds. He commented that consideration needs to be given to
allocating funds toward existing initiatives, or the City would have to raise taxes.
LOST
Councillor Fernandes’ motion was then voted on by a recorded vote and , with
Councillors Y. Fernandes, D. Glenn-Graham and J. Gazzola voting in favour; and Mayor C.
Zehr and Councillors B. Ioannidis, Z. Janecki, S. Davey, K. Galloway, B. Vrbanovic, F.
Etherington and P. Singh voting in opposition.
Councillor B. Ioannidis spoke in support of the comments made by Councillor Davey and
stressed the importance of combating the Emerald Ash Borer as a means of protecting the
City’s tree canopy. He suggested that consideration should be given to allocating the
remaining LEAF funding to the list of unfunded capital projects that were originally presented at
the January 9, 2012 Finance and Corporate Services Committee meeting, being:
$1.1M for Emerald Ash Borer Impact on Street Trees;
$550,000. for Huron Natural Conservation & Development;
$360,000. for Victoria Park Strategic Plan Phase 2;
$600,000. for McLennan Park Development;
$100,000. for Walter Bean Trail Completion; and,
$750,000. for Community Trails.
Mayor C. Zehr indicated that while consideration should be given to the items raised by
Councillor Ioannidis as well as the recommendations put forward by Compass Kitchener, he
suggested that this matter be referred to the Committee’s November 26, 2012 meeting. He
added that this would allow those items to be discussed within the context of the 2013 Capital
Budget and for a decision to be reached prior to Final Budget Day on January 17, 2013.
A motion was brought forward by Mayor Zehr to receive the recommendations contained in the
Compass Kitchener report and refer consideration to the November 26, 2012 Finance and
Corporate Services Committee meeting along with the list of unfunded capital projects
identified at the January 9, 2012 Committee meeting.
Councillor P. Singh brought forward an amendment to Mayor Zehr’s motion, which was
accepted as friendly, to direct staff to report back with information on the revenues anticipated
from the Kitchener Operations Facility’s (KOF) solar roof and whether those funds should
continue to be applied toward the repayment of the loan which currently accounts for a portion
of the estimated $3M remaining in the LEAF account.
Carried Unanimously
The following motion was then voted on and by all members present.
FINANCE AND CORPORATE SERVICES COMMITTEE
OCTOBER 15, 2012 - 150 - CITY OF KITCHENER
CAO-12-043 - COMPASS KITCHENER LEAF COMMUNITY CONSULTATION RESULTS
10.
(CONT’D)
On motion by Mayor C. Zehr -
it was resolved:
“That the recommendations contained in the Compass Kitchener report on the Local
Environment Action Fund (LEAF) Community Consultation, as attached to Chief
be received and referred for consideration
Administrator’s Office report CAO-12-043,
to the November 26, 2012 Finance and Corporate Services Committee meeting
along with the list of unfunded capital projects identified at the January 9, 2012 Finance
and Corporate ServicesCommittee meeting; and further,
That staff be directed to report back with information on the revenues anticipated from
the Kitchener Operations Facility’s (KOF) solar roof and whether those funds should
continue to be applied toward the repayment of the loan which currently accounts for a
portion of the estimated $3M remaining in the LEAF account.”
FCS-12-164 - 2012 AUGUST BUDGET VARIANCE REPORT
11.
The Committee considered Finance and Corporate Services Department report FCS-12-164,
dated September 26, 2012, which provides an update on City expenditures and revenues
compared to the 2012 budget and explains significant variances as of August 30, 2012. In
addition, the Committee was in receipt this date of correspondence from Mr. Harold Drewitz,
dated October 11, 2012 regarding the August variance report.
Mr. R. Hagey reviewed the report, advising that a deficit of $1,417,100 has been projected in
tax supported operations, which is up from the $885,000. deficit forecasted in April 2012. He
stated that this is due to a combination of factors; such as, the worsening of previously
identified deficits in By-law Enforcement and Planning as well as new deficits being projected
for Aquatics and Athletics. He indicated that the City has experienced tax supported operating
deficits for each of the past three years and is projecting a deficit for 2012. He added that
previous deficits have been managed through short-term measures like capital closeouts and
reserves, but these funding sources have largely been depleted. He noted that budgets need
to be adjusted to reflect the actual cost of providing services in order to avoid recurring deficits.
He advised that in developing the 2013 budget, staff will attempt to correct ongoing causes of
variance to the extent possible within the target tax levy increase of 2.87% established by
Council earlier this year. He then reviewed the various projected variances, as outlined in the
staff report.
Mr. Harold Drewitz addressed the Committee, reviewing his circulated correspondence. He
expressed disagreement with the 2.87% targeted tax levy increase, noting that at the August
13, 2012 Finance and Corporate Services Committee meeting, it was indicated that the
proposed increase should be no higher than the rate of inflation. He noted that according to
the August 2012 Consumer Price Index (CPI), the rate of inflation in Ontario was 1.0%. He
commented that if a favourable variance is not reached by the end of 2012, it is unlikely that
the 2013 budget would be no higher than the rate of inflation. He then requested that
responses be provided to the seven questions included in his handout.
In response to questions, Mr. Drewitz confirmed that he is the Chairman of the Kitchener
Taxpayers City Watch Spending Group, which has approximately 47 members. He advised
that while the City would have a difficult time in setting a tax levy increase below 2%, in his
opinion the target increase should be no higher than 1.5%.
Concerning the CPI rate, Mr. D. Chapman advised that the number quoted by Mr. Drewitz is
for the month of August, however, Statistics Canada has indicated a rate of approximately
1.7% as a monthly blended year to date rate.
In response to questions regarding the Parking Enterprise variance, Mr. J. McBride advised
that it primarily related to the delayed opening of the Civic District garage and lower than
budgeted use at the Charles and Benton garage.He noted that revenues are anticipated to
increase next year with the opening of the new provincial courthouse.
FINANCE AND CORPORATE SERVICES COMMITTEE
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FCS-12-164 - 2012 AUGUST BUDGET VARIANCE REPORT (CONT’D)
11.
Questions were raised regarding the Storm Sewer Utility exceeding budgeted expectations
and if a decrease is expected once, the Stormwater Management (SWM) credits are
implemented. Mr. H. Gross advised that while there has been a better than expected uptake in
request for SWM credits, it is unclear at this time as to how this would impact future revenues.
At the request of Councillor Y. Fernandes, Mr. J. Witmer agreed to review the factors that are
contributing to the predicted deficit in the Operations - Administration account.
On motion, Councillor Y. Fernandes brought the recommendation contained in Report FCS-12-
164 forward for consideration, with an additional clause directing staff to post the monthly
financial indicators on the City’s website and respond to the questions raised in the
correspondence circulated by Mr. Drewitz.
On motion by Councillor Y. Fernandes -
it was resolved:
“That Finance and Corporate Services Department report FCS-12-164 (2012 August
Variance Report), dated September 26, 2012, be received for information; and,
That capital closeouts be applied to the operating fund for 2012 to mitigate the projected
operating deficit; and further,
That staff be directed to post the monthly financial indicators on the City’s website and
respond to the questions raised in the correspondence circulated by Mr. Drewitz, dated
October 11, 2012.”
CAO-12-041 - INTEGRATED PLANNING CENTRE OF EXCELLENCE
12.
- BUSINESS PLANNING STATUS UPDATE
Due to time constraints, this item was withdrawn.
ADJOURNMENT
13.
On motion, the meeting adjourned at 6:12 p.m.
J. Billett D. Livingstone C. Goodeve
Committee Administrator Committee Administrator Committee Administrator