Loading...
HomeMy WebLinkAboutCSD-17-079 - Contract Services With the Animal Welfare Agency of South Central Ontario REPORT TO: Community and Infrastructure Services Committee DATE OF MEETING: September 11, 2017 SUBMITTED BY: Gloria MacNeil, Director of By-law Enforcement (519-741- 2200, ext. 7952) PREPARED BY: Gloria MacNeil, Director of By-law Enforcement (519-741- 2200, ext. 7952) Jennifer Sheryer, Assistant City Solicitor (519-741-2200, ext. 7265) Bonnie Saunderson, Senior Financial Analyst (519-741- 2200 ext. 7115) WARD(S) INVOLVED: All DATE OF REPORT: August 10, 2017 REPORT NO.: CSD-17-079 SUBJECT: CONTRACT SERVICES WITH THE ANIMAL WELFARE AGENCY OF SOUTH CENTRAL ONTARIO ___________________________________________________________________ RECOMMENDATION: That Council approve the terms set out in the Report #CSD-17-079 for the animal services and dog licensing contract with the Animal Welfare Agency South Central Ontario and direct staff to prepare a contract in accordance with such terms as ion dated June 26, 2017 which authorizes execution of such agreement, and further, That the Mayor and Clerk be authorized to execute an amendment to the Animal and Dog Control and Pound Services Agreement dated January 1, 2014 with the Animal Welfare Agency South Central Ontario to remove the requirement for the Humane Society to remit $209,335 from 2016 dog licensing proceeds to the City, That staff be instructed to seek approval of the Director as designated by the Minister of Agriculture, Food and Rural Affairs to change the redemption period for dogs back to the statutory minimum of three days. BACKGROUND: The City of Kitchener has a long standing relationship with the Animal Welfare Agency of South Central Ontario in which the Humane Society provided a variety of services within our community, including: animal control, pound services, dog 2 - 1 licensing, and animal by-law enforcement services, as well as spay and neuter programs. The current contract with The Humane Society expires at the end of 2017. On June 26, 2017, Council authorized execution of an animal services and dog licensing contract with the Humane Society for an initial term of four years with the potential for two further renewal terms. That Council resolution required that the terms of the contract be approved by City Council at a subsequent public meeting and also that they be satisfactory to the City Solicitor.This report is seeking council approval of those negotiated terms. REPORT: The financial structucontract with theHumane Society is based on a base amount paid to the Humane Society, which is subject to inflationary adjustments year over year, as well as dog licensing revenues. Any surplus of dog licensing revenue, is to be used by the City towards programming for the Responsible Pet Ownership Strategy. Throughout contract negotiations between the City and the Humane Society it was apparent that payments under the current contract were insufficient to fund the services required by the City. As the previous contract has had a negative impact,the Humane Society is asking the City to remove the requirement for the Humane Society to remit $209,335 from the 2016 dog licensing proceeds to the City. If approved by Council, this would be done by way of an amendment to the existing contract. The proposed contract is structured to allow the Humane Society to retain dog licensing revenue over $445,000 (if any) collected in 2018. This will assist the Humane Society in its obligation under the current contract to pay to the City $209,000 of dog licensing revenue collected in 2017 during the 2018 calendar year. The proposed contract will also attribute a portion of dog licensing revenue collected in 2017 but related to licensing in 2018 to the 2018 collection period. This attribution of collected licensing fees to the period of licence validity will continue throughout the term of the contract. Under the new terms of the contract, the Humane Society will perform a varitety of services, including: Provision of a Pound facility and performance of legislated Poundkeeper duties in accordance with by-laws and legislation Provision of by--laws regarding dogs and animals including the designations of potentially By-law Enforcement Division also provides by-law enforcement services); Inspections of exhibitions/circuses involving animals, pet shops, kennels, boarding kennels, and doggy daycares pursuant to applicable by-laws; Catching and impounding of stray dogs, picking up stray cats, and picking up injured or dying wild and domestic animals; Removing and disposing of dead animals from public places; 2 - 2 Assisting the Fire Department and Waterloo Regional Police Services in capturing, removing, and sheltering domestic animals; Assisting the City in creation or refinement of by-laws respecting animals; Keeping records in accordance with standards set out in the Agreement and provincial legislation; s dog licensing by-law program (details to be discussed later in this report); and Administering the spay and neuter program contributed to by the City The proposed new contractual terms will ensure current services and service levels are maintained within the community.In addition to all services currently provided, the Humane Society has also offered to provide assistance with responsible pet ownership initiatives, to the City for cost of reimbursement only. It is anticipated that this will result in significant cost savings for the City as the Humane Society already has the infrastructure necessary to run responsible pet ownership programs and the benefit of having a higher volume operation than the City could on its own. The City will also City as we partner on responsible pet ownership initiatives. Staff and the Humane Society are proposing a 4 year agreement, from 2018 to 2021. The agreement would also include options for the parties to renew the contract for up to two further terms of four years each, if the parties agree on the terms applicable to such renewal(s). Base Contract Amount Staff and the Humane Society are proposing an agreement that would see an increase in the base amount paid to Humane Society, currently set at $505,053. The proposed contract fee is based off of a per capita amount of $3.916 multiplied by the agreed upon base population number of 233,222 which is a total of $913,297 and results in an increase to the contract in the amount of $295,579.This amount will be adjusted annually commencing in 2019 by using the Ontario Consumer Price Index (CPI). In addition to CPI adjustments, the base amount will also be adjusted for the calendar year of 2021 to ensure best estimates of accurate population numbers are used for the base amount calculation. Dog Licensing Service Fees For many years, agreement with the Humane Society has required them to which in the past has included a revenue sharing model. The current model allows the City to use licensing revenue to help offset the cost of the proposed contract with proceeds after a certain amount to be used towards programming for the Responsible Pet Ownership strategy. 2 - 3 In 2018, the Humane Society will be entitled to keep any dog licensing fees over $445,000 that it collects. This will assist the Humane Society in recovering from difficulties caused by inadequate funding under the current contract while providing it with an incentive to grow dog licensing to the benefit of the City. In 2019, 2020 and 2021, the $445,000 amount will be subject to CPI adjustments. The adjusted amount will be applied by the City to the base contract fees owed to the Humane Society. Dog licensing fees collected that exceed this adjusted base amount will be used by the City only for the purpose of responsible dog ownership initiatives. As the Humane Society and the City share an interest in encouraging responsible pet ownership, this funding allocation provides an incentive to us and the Humane Society to continue to grow dog licensing. Licensing Administration Fees The Humane Society has always administered dog licensing program however the service has previously beenincluded in the base amount of the contract. A review of the program shows this to be an additional cost of $113,000 a year, which includes costs for the licensing of the software program, mailing notices out to dog owners, staffing resources to process licenses and mail them out and staffing resources to follow up with non-compliant owners. Under the proposed contract terms, the city would pay an additional annual amount to cover these costs. The proposed amount for 2018 is $113,000 and this amount would be adjusted annually commencing in 2019 by using CPI. Dog Licensing Program Augmentation Fund The proposed contract terms include a $10,000/year licensing program augmentation fund. This fund is a new initiative and would allow City and Humane Society staff to try new ideas and initiatives for growing the dog licensing program. This could include ideas such as mail-outs, door to door education, dog training in the park or other events for license holders, etc. The overall goals with this fund are to work collaboratively to educate the public on dog licensing, increase benefits to dog licence holders and to make the public aware of the value of dog licences. The effectiveness of expenditures would be reviewed each year to consider the best use of the fund in the following year. The proposed terms also include a commitment by the City to provide in kind marketing and communication assistance to grow the dog licensing program. Staff time, facility but any hard costs should be covered through the licensing program augmentation fund. Spay/Neuter Programs For many years, the City has provided $30,000 annually to assist with sterilization of animals prior to their adoption from the Humane Society. The aim of the program is to 2 - 4 ensure that pets being adopted from the Humane Society are sterilized as a means of controlling animal populations. There will be no increase in the $30,000 of funding the City currently provides in 2018. Following 2018, this amount will be adjusted in accordance with CPI. As animals are now altered while owned by the Humane Society,we can benefit from lower rates based on the high volume of procedures performed by the Humane Society. This enables the money contributed by the City to go further allowing more animals to be sterilized with these funds.This also allows the Humane Society and the City to lead together by example in modelling responsible pet ownership. The Humane Society will continue to be required by our agreement to contribute a minimum of $60,000 annually to this program although we understand that their actual contribution has historically greatly exceeded this amount. This contribution by the Humane Society to the sterilization of animals in our community provides a significant benefit to the City. Responsible Pet Ownership Strategy Staff are recommending that any licensing revenue exceeding $445,000 (as adjusted by CPI) annually over the second to fourth years of the contract, be applied to responsible pet ownership initiatives. The Humane Society is willing to perform services at cost which is an opportunity for the City to stretch any money applied to such initiatives further. Some of the initiatives that are being explored are: Education or education materials on responsible pet ownership Microchipping or sterilization of dogs or animals from low income households Microchipping or sterilization of feral cats; and Responsible and humane management of feral cat colonies Redemption Period and By-law Changes Currently the City requires the Humane Society to hold a dog that is picked up or turned in for 5 working days before it is considered owned by the Humane Society. Legislation only requires a three day redemption period and the City increased this period in hopes of reuniting more stray dogs with their owners. The Humane Society has informed the City that the increased holding period has had a very minimal impact on the number of dogs that are returned to their owners but has resulted in increased expenses. Additionally, the Humane Society feels that holding dogs for five working days creates unnecessary stress on the dogs and prevents the Humane Society from being able to start the adoption process sooner. The Humane Society has asked that the City take steps to have this redemption period decreased back to the statutory minimum of three days. Although staff supports this request, the City is not able to implement this change without the permission of the 2 - 5 Director as appointed by the Minister of Agriculture, Food and Rural Affairs. Staff seeks uest the necessary permission from the Director and upon By- The Humane Society has also asked the city to review the administrative requirements relating to inspections and registration of restricted animals.Staff is undertaking this review and will bring forward any proposed changes to Chapter 480 of the City of Kitchener Municipal Code (A Conclusion Staff believes that the proposed contract terms provide for fair and reasonable compensation for the services provided by the Humane Society and that the City is still obtaining good value for services provided.Additionally, the shared interest of the City and the Humane Society in responsible pet ownership will allow for partnership opportunities with mutual benefit throughout the term of the contract. ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN: The recommendation of this report supports the through the delivery of core service. FINANCIAL IMPLICATIONS: Staff have negotiated a contract that applies a fee of $3.916 per capita multiplied by the agreed upon base population number of 233,222 which is a total of $913,297 and results in an increase to the contract in the amount of $295,579. For illustration purposes, the chart below outlines the financial implications for 2018, the base amount, licensing administration fees, and spay/neuter subsidy would increase each year based on the Ontario Consumer Price Index. Base Amount$913,297 Licensing $113,000 Administration Fees Licensing Program $10,000 Amplification Spay/Neuter Subsidy$30,000 Discretionary $5,000 Community Veterinary Outreach Program Less anticipated $445,000 minimum licensing revenue Net budget impact$(295,579) 2 - 6 Should the anticipated minimum licensing revenue not be obtained, the City would still be required to pay the full base amount. However, staff believes that this is a very low risk, especially in light of the proposed initiatives to strengthen the dog licensing program. The financial impact of these proposed changes would require $285,427 be added to the Forgiveness of the outstanding payment from the Humane Society in 2017 in respect of 2016 would be a one-time draw of $209,335 on the tax stabilization reserve fund which has a current balance of $2,160,601 and is presently below the minimum target. Staff will attempt to incorporate this additional funding into the proposed 2018 operating budget in a manner however, this may be a challenge given the significant cost of this addition and other pressures, including impacts of new legislation, on the 2018 operating budget. Finally, this report speaks to the potential to provide an annual honorarium, not to exceed $5,000, to the Human Veterinary Outreach Program. It is and will ensure that it will not be provided if it cannot be accommodated within existinhg levels. COMMUNITY ENGAGEMENT: The contract negotiations referenced in this report are administrative in nature. ACKNOWLEDGED BY: Michael May Deputy CAO, Community Services Department 2 - 7