HomeMy WebLinkAboutINS-14-019 - Regional Maintenance Agreement 2015-2019 Staff Rport
I r rc'.�► t .R Infrastructure Services Department wmkitchener.ca
REPORT TO: Community and Infrastructure Services Committee
DATE OF MEETING: September 8, 2014
SUBMITTED BY: Jim Witmer, Director of Operations, 519-741-2600 ext. 4657
PREPARED BY: Jim Witmer, Director of Operations, 519-741-2600 ext. 4657
WARD(S) INVOLVED: All
DATE OF REPORT: August 12, 2014
REPORT NO.: INS-14-019
SUBJECT: Regional Maintenance Agreement, 2015-2019
RECOMMENDATION:
That the Mayor and Clerk be authorized to sign an agreement with the Regional
Municipality of Waterloo, satisfactory to the City Solicitor, for the City of Kitchener to
provide summer and winter maintenance services on selected Regional Roads within the
City of Kitchener for the contract period of 2015-2019.
BACKGROUND:
Since the formation of the Region of Waterloo in 1973 the City of Kitchener has provided winter
and summer maintenance of Regional Roads within the City of Kitchener boundaries. The
rationale to continue providing this service has been long standing, as prior to 1973 all roads
within the city boundary were maintained by the City of Kitchener and resources levels were
structured to provide this service level.
Additionally there are economies of scale that allows for efficient deployment of resources to
maintain all roads within the city regardless of their ownership. By example, snow ploughs
required to plough City streets typically need to travel along Regional roads to get to the city
streets, so maintaining Regional roads makes good sense.
Since 1973 the Region has paid the City of Kitchener annually for the time, equipment, material
and overhead costs associated with providing this service.
REPORT:
The winter and summer routine maintenance of Regional Roads within the City of Kitchener has
been traditionally adopted by both municipalities utilizing a purchase order supported by
standard terms and conditions. Prior to the agreement, annual expenses by the City would be
invoiced to the Region for payment. The amount of payments would fluctuate yearly mainly
dependent on the severity of the winter. The non-winter activities remain consistent, changing
only with the growth of the infrastructure.
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In 2005, the Region of Waterloo requested that a formal agreement be put in place with all
municipalities within the Region of Waterloo to establish the costs associated with road
maintenance allowing each municipality the opportunity to budget for the maintenance. Base
rates were calculated utilizing a 5 year average of expenses across the Region and a common
winter and summer lane kilometer rate was established. The established rates also allow for
annual increases attributed to inflation factoring blended increases in labour, material and
equipment costs as well as system growth.
Winter activities normally account for 75-80% of maintenance costs incurred annually and a
reserve fund was established for years when winter costs exceeded the lump sum budget. The
reserve fund is financed from excess revenues when actual winter costs are less than the lump
sum amount.
For winter maintenance activities, the Region will continue to pay the Cities based on a baseline
average (BA) approach. The winter BA has been set using historical actual winter maintenance
costs for the Cities. The Region will continue to make payments to the Cities based on the Cities
actual winter maintenance costs up to 100% of the BA. Any costs incurred in excess of the BA
up to 105% of the BA will continue to be the responsibility of the Cities. Any costs exceeding
105% of the BA will continue to be reimbursed by the Region.
Under the proposed terms of the 2015-2019 agreement, the following improvements have been
made to the winter scope and the budgets have been adjusted accordingly:
• Monthly minimum payment — the winter monthly payments will continue to be issued
based on the Cities actual winter cost as noted above. However at the request of the
Cities, new for 2015 is the introduction of a monthly minimum payment. Each winter
month the Cities winter payment will be >or= 65% of the monthly BA. This monthly
minimum clause has been added to the contract in an effort to recognize the Cities fixed
cost associated with performing this work.
• Regional Contract Reserve — also new for 2015 at the request of the Cities, is the
creation of a Regional Contract Reserve. In any given year, should the actual winter cost
not reach 100% of the BA, the Region shall retain those budgeted savings in a Regional
Contract Reserve. The Cities are then permitted to access those funds to cover any
winter cost overruns (winter cost >100% < 105%) incurred previously or in the future.
• Non-routine winter services — At the request of the Cities, the contract language has
been updated allowing non-routine winter services to be performed during the classified
winter months should mild weather permit it. This change will allow the Cities more
flexibility in managing the contract work based on the elements and not the calendar
date.
• Leaf Collection — this work was previously done only by work order at the request of the
Region.
The Maintenance Agreement is for work identified in Schedule "A" of the attached Draft
Agreement and includes items such as:
• Road patrolling
• Summer maintenance including;
• surface asphalt maintenance,
• shoulder maintenance,
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• street sweeping,
• spring cleanup (litter pick up), and
• right of way drainage including catch basin and manhole maintenance
• Leaf pickup and disposal
• Winter snow and ice control
• Emergency response (e.g. accidents, washouts, spills, trees, debris, etc.)
• Preventative maintenance agreed to by the Region.
Under the proposed terms of the 2015-2019 agreement, the following new exclusions have
been made to the summer scope and the budgets have been adjusted accordingly.
• Tree maintenance and planting, (except in response to emergency situations)
• Shrub bed maintenance, (except at locations previously agreed to with the local
municipality ie: King St. E. entrance)
• Vegetation maintenance, (grass cutting, island trimming etc.)
The Maintenance Agreement also does not include the following:
• Sign installation and maintenance,
• Traffic control signal maintenance,
• Center and edge line painting,
• Special markings and crosswalks,
• Bridge maintenance, (except sweepings and initial emergency response to emergency
accidents)
• Crack sealing,
• Street lighting,
• Utility cut repair for which the Local Municipality charges back the utility
The current agreement with the Region will expire on December 31 st, 2014.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
Approval of this agreement supports the Community Priority of Efficient and Effective
Government, as contained in the City's Strategic Plan.
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FINANCIAL IMPLICATIONS:
Payment for winter maintenance and summer maintenance to the City of Kitchener is
$2,585,081 annually and is adjusted annually by inflation and by any additional lane km in
accordance with the terms and conditions as identified in the agreement.
At the end of the calendar year, the yearly winter costs will be reviewed. Any yearly winter costs
incurred by the City between 100% and 105% will be paid by the City. Any costs in excess of
the 105% budgeted amounts will be reviewed by the City and the Region and reimbursed based
on a mutually agreed upon amount.
COMMUNITY ENGAGEMENT:
INFORM —This report has been posted to the City's website with the agenda in advance of the
council / committee meeting.
CONCLUSION:
The three cities and the Region undertook significant negotiations and dialogue over the last
two years to arrive at an agreement that reflects the level of effort, financial compensation and
work distribution which will benefit the constituents and businesses residing in the respective
municipalities. The draft agreement and funding as proposed provides for a seamless delivery
of value added service for the length of the contract.
ACKNOWLEDGED BY: Pauline Houston, DCAO, Infrastructure Services Department
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