Loading...
HomeMy WebLinkAboutFinance & Admin - 1993-12-10 SFAC\1993-12-10-SPE FINANCE AND ADMINISTRATION COMMITTEE MINUTES DECEMBER 10, 1993 The Finance and Administration Committee met this date, commencing at 9:15 a.m., under the Chairmanship of Councillor C. Zehr with the following members present: Mayor D.V. Cardillo, Councillors B. Stortz, T. Galloway, G. Lorentz, J. Smola, M. Wagner, C. Weylie, J. Ziegler, M. Yantzi and G. Leadston. Others present: Messrs. T. McKay, J. Gazzola, L. Ryan, K. Bowman, R. Freeborn, C. Cooke, W. Beck, D. Paterson, O. den Ouden, L. Parkhouse, R.W. Pritchard, B. Gulliver, L. Gordon, R. Miller, G. Borovilos, D. Suzuki, S. Gyorffy, B. Liddle, D. Snow, J. McBride, E. Kovacs, G. Sosnoski, Ms. V. Gibaut and Ms. S. Curzon. The purpose of the meeting was to further consider the 1994 Department Operating Budgets as recommended by the Administrative Review Committee. 1. 1994 OPERATING BUDGET The Committee was in receipt this date of a comprehensive information report dated December 9, 1993 including a summary of conferences and staff training budgets, details relative to the Humane Society contract and a summary of the Kitchener Public Library (KPL) Board Operating Budget. They were also in receipt of a report from Ms. M. Walshe of the KPL dated December 10, 1993 and a computer print-out from the Administrative Services Department entitled "Benefit Rollbacks" dated December 9, 1993. In addition, Committee members also received a copy of the 1993 Budget book. Mr. Gazzola reviewed the 1994 Operating Budget for all Divisions of the Administrative Services Department and highlighted changes relative to the 1993 Budget. It was noted that the overall budget, including Transit, has increased by .53%. Mr. Gazzola noted a projected $6,000.00 decrease in Transit revenue despite the recently approved fare increases. He also reviewed items on Lists B and Z. Councillor Zehr referred to the List Z item involving elimination of Transit service after 10:00 p.m. Mr. Beck pointed out that this would affect both Kitchener and Waterloo and though the gross cost saving would be $810,000.00 the saving to the City net of reductions in revenue, ridership and grants would be $230,000.00. He cautioned however, that cutting service reduces revenue and ridership and has a downward spiralling effect. Councillor Lorentz questioned why such a reduction could not be examined in the context of less popular routes rather than the overall system and service reduced gradually. Mr. Beck replied that staff have been doing this over the last few years and reminded the Committee that based on Transit standards recently approved by Council the last service in would be the first to be removed. He added that staff continually reviews ridership patterns and tries to adapt the level of service to demand, based on available resources. Councillor Lorentz asked that this item be flagged for discussion on Budget Day, January 21, 1994, and that additional detail be provided on or before that date including the number and location of routes presently operating after 10:00 p.m., the potential for loss of ridership and other related issues. Councillor Wagner asked whether Waterloo is aware of the possible reduction and suggested that this cannot be done unilaterally. He suggested looking at reductions after 11:00 p.m. rather than 10:00 p.m. Mr. Beck advised that there has been no discussion with Waterloo and though the change would result in annual savings the service reduction cannot be implemented until March of 1994. He also pointed out that staff had begun by examining service reductions after 11:00 p.m. and had worked back to the 10:00 p.m. time. Councillor Stortz suggested that service after 10:00 p.m. is critical to a Transit system and supported the approach of rationalizing routes rather than implementing overall service reductions. Councillor Yantzi agreed offering the opinion that dismantling the Transit service piecemeal is counter productive. Councillor Leadston indicated that the issue should be examined further and the City of Waterloo involved in the discussion. Councillor Weylie suggested that this issue be discussed further at a Public Works and Transportation Committee meeting along with additional information on the closing time of local companies who would be affected by the reduction. Councillor Wagner stated that he is opposed to wasting staff time to gather the information requested and that Council should first decide what type of service it wants. FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 131 -DECEMBER 10, 1993 1. 1994 OPERATING BUDGET (cont.) Councillor Ziegler entered the meeting at this time. Councillor Leadston asked for a report on Budget Day concerning the potential for contracting mechanical services involving City buses. Mr. McKay clarified that buses are presently maintained by the Fleet Division and indicated that he could have Mr. Gulliver investigate and report. By general consent, it was agreed that a presentation concerning the possible reduction of Transit service after 10:00 p.m. would be given at the January 17, 1994 Public Works and Transportation Committee meeting. Mayor Cardillo also asked for information as to the dollar impact of a half day reduction in statutory holiday service. Mr. McKay highlighted the item in the Administrative Services budget relative to Certification - Joint Health and Safety, noting that this is an ongoing expenditure and training requirement. Mr. Freeborn noted that this is a result of Provincial legislation which has once again increased the costs of the municipality. He referred to the schedule of fringe benefit reductions circulated this date and advised that these could be reduced subject to negotiations with the Unions as all are embodied in collective agreements. In response to a question from Councillor Zehr, Mr. Freeborn indicated that the cost to the City of providing out-of-country insurance for staff is approximately $38,000.00. Moved by Councillor J. Ziegler - "That staff be instructed to remove out-of-country travel insurance from the City's benefit package and take the necessary steps relative to Union negotiations." Councillor Ziegler suggested that this benefit is inappropriate and acknowledged that it may take time to remove it. Mr. Gazzola clarified that in the past year there has been a change in the rules for out-of-country coverage, and though this was initially provided on a no additional cost basis, carriers have since charged for the coverage. Councillor Ziegler added that this coverage should be available to employees if they are willing to pay for it themselves. Mr. McKay stated that the issue would have no effect on the budget and would take time to implement, with any savings going to the Social Contract. Councillor Stortz suggested that this should be considered as long term direction and noted that employees have already been hit hard by the Social Contract and that this would constitute a further clawback. Mr. McKay clarified that the cost of benefits is always increasing, but that delivery of benefits to staff is negotiated on a percentage basis. He referred to the substantial number of benefits in the schedule circulated by Mr. Freeborn this date and noted that staff had initially decided that benefit packages should not be examined in the context of Social Contract negotiations. He advised that he plans to discuss with the Unions methods whereby the City would receive better value for all of its benefit expenditures. Councillor Ziegler expressed the opinion that, notwithstanding the cost, he is philosophically opposed to staff receiving out-of-country travel benefits. The motion by Councillor Ziegler to remove out-of-country travel insurance from the benefit package was voted on and . LOST On a motion by Councillor B. Stortz - It was resolved: "That the entire benefit issue be raised with staff over the next few years with the goal of identifying mutually beneficial cost reductions." In response to a comment by Councillor Lorentz, a brief discussion took place concerning the possibility of staff reductions in the area of labour relations as a result of the Social Contract. Mr. Freeborn pointed out that the negotiation of contracts involves a very small portion of staff time and Mr. McKay suggested that any reduction in this area may not be sustainable given the massive number of negotiations which will take place following the end of the Social Contract in 1996. 1. 1994 OPERATING BUDGET (cont.) Councillor Weylie inquired as to the feasibility of self-insuring the municipality and Mr. Freeborn stated that this issue is being looked at on a Region-wide level but is not progressing at a rapid FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 132 -DECEMBER 10, 1993 rate. Councillor Zehr questioned whether political pressure would be required and Mr. McKay responded that the initiative originated through the Region's Chief Administrators and that all work to date has been done by Kitchener. He added that once detailed examination of the proposal was underway two of the parties backed away. On a motion by Councillor B. Stortz - It was resolved: "That the 1994 Operating Budget for the Administrative Services Department be adopted as recommended by the Administrative Review." Mr. Gazzola reviewed the 1994 Operating Budget for the General Services and City Clerk's Department and highlighted changes from the 1993 Budget, noting a net increase of .28%. He added that this budget includes the total annualization costs for operating the City Hall. In response to a question from Councillor Wagner concerning the actual cost of the election in 1994, Mr. Pritchard replied that staff are budgeting $210,000.00 which is slightly more than half of the cost to other municipalities. He added that this is due to use of the votomatic system. The Committee reviewed the 1994 Operating Budget for the Fleet Division and the related items on List Z. It was noted that the Division budget has not increased over the 1993 amount. The Committee reviewed the item on List Z relative to the contracting of maintenance service for a saving of $26,000.00. Mr. Gulliver cautioned that the prices used in preparing the estimate reflect the recession and increased costs are anticipated as the economy improves. He also advised that two positions would be impacted and that based on the existing Union contract these individuals would have to be re-deployed elsewhere in the City. Moved by Councillor Ziegler - "That the City contract service maintenance in its Fleet Division for a future saving of approximately $26,000.00. Mr. Gazzola pointed out that any saving realized in this area would accrue to the Social Contract until 1996. Mr. Pritchard clarified that the gross annualized costs in this area are $100,000.00. Mr. McKay cautioned that though it seems logical to reduce this item it is the only area of the City where there have been recent layoffs. He indicated that based on the Union involved the City would likely lose more in productivity, grievances and arbitration than would be gained. The motion by Councillor Ziegler to contract service maintenance in the Fleet Division was voted on and . LOST The Committee reviewed the List Z item relative to a reduction in bus cleaning. Mr. Gulliver clarified that this applies to spring cleaning only and endorsed the $5,000.00 reduction. On a motion by Councillor M. Yantzi - It was resolved: "That the Fleet Division budget be reduced by $5,000.00 to reflect a reduction in bus cleaning." The Committee considered the List Z item relative to a 50% reduction in body work for a saving of $57,000.00. Mr. Gulliver clarified that this item relates to cosmetic body work and involves minor damage and small rust areas. He noted that there is a staff impact and cautioned that if removed, there may be a public perception that based on their appearance the buses are less safe. He added that though appearance of the vehicles would be affected they could still be run safely. 1. 1994 OPERATING BUDGET (cont.) On a motion by Councillor M. Wagner - It was resolved: "That the 1994 Operating Budget for the General Services and City Clerk's Department be approved as recommended by the Administrative Review Committee and amended this date to reflect a $5,000.00 reduction (bus FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 133 -DECEMBER 10, 1993 cleaning) in the Fleet Division." Mr. Gazzola reviewed the 1994 Operating Budget for the Chief Administrator's Office and noted that there is no increase over the 1993 Budget. On a motion by Councillor G. Leadston - It was resolved: "That the 1994 Operating Budget for the Chief Administrator's Office be approved as recommended by the Administrative Review Committee." Mr. Gazzola reviewed the 1994 Operating Budget for the Economic Development Department and noted a decrease of -2.3%. He noted that $10,000.00 has already been removed from the promotion budget and an additional $10,000.00 is included on List Z. Ms. Gibaut explained that last year $20,000.00 was allocated to the Kitchener Downtown Business Association (KDBA) to assist in their external recruitment activities. She further advised that to date the KDBA has used only $10,000.00 of this amount. Councillor Stortz added that the remaining $10,000.00 is earmarked for a strategic planning exercise intended as a followup to the earlier visioning process. He also informed the Committee that Kitchener is competing as one of three Provincial pilot projects involving downtowns. Councillor Wagner inquired as to the impact of removing the additional $10,000.00 from the 1994 budget. Ms. Gibaut suggested that the KDBA could still undertake its initiatives on the basis that no separate trade show allocation would be required. She added that the KDBA could likely promote its retail component in the downtown using existing budget funds. Moved by Councillor J. Ziegler - "That the 1994 Operating Budget of the Economic Development Department be further reduced by $10,000.00 relative to the promotional budget for the Kitchener Downtown Business Association." Councillor Stortz urged that the $10,000.00 amount remain in the budget, noting that it would allow a project in the core area to proceed. He referred to the need for both municipal involvement and business support in revitalizing the downtown and pointed out that at present the KDBA is paying the cost of courtesy parking in the downtown. Councillor Lorentz indicated that he would not support the motion but suggested that staff, in conjunction with the KDBA, should develop mutually agreeable initiatives and that the City should not act solely as the Association's banker. Ms. Gibaut noted that at present staff sit on the KDBA Committees and that she sits on the Board, and suggested that the money is extremely well spent and that staff are only recommending removal of the first $10,000.00 amount. Councillor Ziegler withdrew his previous motion concerning a further $10,000.00 reduction in the promotional budget. On a motion by Councillor G. Leadston - It was resolved: "That the 1994 Operating Budget for the Economic Development Department be approved as recommended by the Administrative Review Committee." 1. 1994 OPERATING BUDGET (cont.) Mr. Gazzola outlined the 1994 Operating Budget for the Finance Department and highlighted changes over the 1993 Budget, noting a net increase of 1.08%, due mainly to an increase in the cost of maintenance contracts. The Committee considered the List B item relative to elimination of part-time secretarial hours for a saving of $10,000.00. Mr. Gazzola advised that the only remaining part-time Secretary does work for the Commissioner, Directors and Managers and fills in during breaks and lunch. On a motion by Councillor M. Wagner - FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 134 -DECEMBER 10, 1993 It was resolved: "That the 1994 Operating Budget for the Finance Department be approved as recommended by the Administrative Review Committee." Mr. Gazzola reviewed the 1994 Operating Budget for Legal Department and highlighted changes over the 1993 Budget, noting an increase of 3.3% due to the conversion of a staff position from contract to full-time. On a motion by Mayor D.V. Cardillo - It was resolved: "That the 1994 Operating Budget for the Legal Department be approved as recommended by the Administrative Review Committee." Mr. Gazzola reviewed the 1994 Operating Budget for the Public Works Department, and highlighted changes over the 1993 Budget, noting a net increase of 2.6%. The Committee considered budgets for Operations, Street Lighting and Traffic having a net increase of .26%. Mr. Gyorffy noted a $100,000.00 reduction in costs as a result of recommendations arising from the Continuous Improvement Process. He indicated that street sweeping equipment would be reduced from six to four units and that there would be changes involving the downtown sidewalk clearers and street flushing equipment. Mr. McKay advised that there is no allowance in the 1994 budget for additional Crossing Guards and Mr. Snow added that there are no pending requests at this time. Mr. Gazzola referred to the 1994 Operating Budget for the Gas Utility, noting a decrease of - 109.4%, largely due to a recently approved gas rate increase which is partially offset by higher gas purchase costs. Councillor Leadston inquired as to City initiatives in the retailing of additional gas appliances. Mr. Kovacs replied that this would likely be addressed by the new Marketing Manager and Councillor Leadston asked that a report be submitted in the near future. In response to a question from Councillor Wagner, Mr. Kovacs advised that there were between 1,200 and 1,500 new service laterals installed in 1993, and pointed out that the Utility has maintained approximately the same number of conversions over the past four years. He added that whereas in the past 70% to 80% of the connections came from new homes the same percentage now applies to conversions. Mr. Kovacs advised that additional conversions could be expected over the next two years. In response to a question from Councillor Lorentz, Mr. Kovacs advised that he is hoping to fill the vacant Marketing Manager position by February of 1994 and in the interim staff are pursuing existing program objectives. Mr. Gazzola reviewed the Six Year Projection for the Gas Utility, noting that revenues over expenditures are likely to remain at the $9,000,000.00 level to 1999. He advised that in his opinion the present dividend can be maintained. Mr. McKay cautioned that a $2,500,000.00 accumulated surplus is traditionally low for a Gas Utility and that a 5% to 10% drop in gas sales due to a mild winter could entirely reduce the 1. 1994 OPERATING BUDGET (cont.) surplus. He also added that 1994 is the last year that money can be removed from the Tax Stabilization Reserve Fund (TSRF). Councillor Stortz referred to the $256,000.00 amount on List B relative to an increase in the gas and water dividend and asked whether staff had given any thought to a phase-out of the TSRF and a phase-in of gas revenues. Mr. McKay replied that there are no financial concerns with respect to the increased dividend and added that by 1996 this surplus will be the only opportunity for an infusion of funds into the TSRF in the event the economy does not improve. He also reminded the Committee that 1996 marks the end of a three year wage freeze. Mr. McKay stated that he has not as yet worked out a detailed transition plan for 1995/96, however, this will have to be looked at in 1994. Councillor Stortz asked that the transition plan be considered as a priority for the 1995 budget. Councillor Galloway agreed that a long term strategy is needed and also suggested consideration of a reduction in Current to Capital in the near term, noting that the City is well funded on a Capital FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 135 -DECEMBER 10, 1993 basis but struggles through the Operating Budget and Levy. Moved by Councillor B. Stortz - "That the City increase its dividend from the Gas and Water Utilities by $256,000.00 and that staff prepare a transition plan to facilitate phasing out of the Tax Stabilization Reserve Fund and phasing in of the Gas Utility dividend." Councillor Stortz asked that the above motion be tabled pending review of the Water Utility budget. Mr. Gazzola reviewed the Six Year Projection for the Water Utility highlighting revenues and expenditures. He advised that revenues over expenditures presently total $1,200,000.00 and that the accumulated surplus will stay at or below the $4,000,000.00 mark. Mr. Kovacs informed the Committee that the Infrastructure Study will be completed by the Summer of 1994 and by that time staff will be able to more clearly identify actual capital expenditures. He noted that early indicators point to the need for increased expenditures in this area and more attention to replacement services. Mr. Gazzola pointed out that there is no rate increase proposed in 1994, but for budget purposes a 1.5% inflation increase has been used to 1999. Mr. Gazzola reviewed the Six Year Projection relative to the Sewer Surcharge, noting decreased revenues largely as a result of a fee paid to the Region for sewage processing. He pointed out that transfers to Capital will decrease in 1994 and every year thereafter transfers are estimated at $2,300,000.00. Mr. Gazzola reviewed the Six Year Projection for the Parking Enterprise and noted a number of changes in revenue and staffing. Mr. McKay pointed out that Lot #8 which fronts onto King Street between Frederick and Queen Streets will be closed as a municipal lot effective April 30, 1994. Mr. Snow reported that Lot #8 is in a deficit position and staff are suggesting that the Lot be returned to the property owner as at present the City is paying taxes on the land and not recouping this amount. Councillor Stortz asked whether any effort had been made to re-negotiate with the owner and Mr. Snow replied in the affirmative. He noted that it had been suggested that the owner pay that portion of the taxes not offset by parking revenue but that he declined. Councillor Stortz put the Committee on notice that first hour free parking in the downtown is now under voluntary review and alternatives have been suggested. He noted that there has also been some discussion regarding an extension of the courtesy program and cost sharing with the KDBA. Mr. McKay pointed out that extending the courtesy program for a full year is a substantial cost. With regard to the Six Year Projection, Mr. Gazzola noted that the excess of expenditure over revenue in 1993 will be worse than anticipated and the Enterprise will end the year in a deficit position 1. 1994 OPERATING BUDGET (cont.) of approximately $3/4 million. He noted that in 1994 additional expenditures over revenues of approximately $78,000.00 are projected with this amount increasing over subsequent years. He added that a dividend is being projected beginning in 1996. The Committee reviewed the List B items for the Public Works Department. Mr. Kovacs reported that he feels the City can reach its five year cycle at a reduced cost provided there is no change in the contract prices and work progress. He offered the opinion that this is a reasonable risk. Mr. Kovacs also pointed out that the $28,600.00 figure relative to overtime for valve repairs is related to the cleaning program. On a motion by Councillor B. Stortz - It was resolved: "That the 1994 Operating Budget for the Water Utility be reduced by $50,000.00 relative to the main cleaning program and $28,600.00 relative to overtime for valve repair." The Committee then considered the motion by Councillor Stortz relative to an increase in the Gas FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 136 -DECEMBER 10, 1993 and Water dividend which was previously tabled by the Committee. On a motion by Councillor B. Stortz - It was resolved: "That the City increase its dividend from the Gas and Water Utilities by $256,000.00 and that staff prepare a transition plan to facilitate phasing out of the Tax Stabilization Reserve Fund and phasing in of the Gas Utility dividend." On a motion by Councillor J. Smola - It was resolved: "That the 1994 Operating Budget for the Public Works Department be approved as recommended by the Administrative Review Committee and amended this date to reflect a reduction in the main cleaning program and overtime for valve repair and an increase in the Gas and Water dividend." The Committee adjourned for lunch and reconvened at 1:30 p.m. to consider the balance of the agenda. Mr. Gazzola reviewed the General Revenues and Expenses portion of the 1994 Operating Budget and noted a net decrease of -13.82%. He noted that interest income in 1994 will fall by approximately $1,000,000.00 due to lower interest rates. He also noted a planned 5% annual increase relative to replacement of the corporate telephone system which has a life expectancy of approximately eight years. Mr. Gazzola drew the Committee's attention to the current rates for penalty and interest arrears and noted that if left at their present level of 1¼%/month or 15%/year would result in additional revenue of $100,000.00. Councillor Ziegler inquired as to the impact of moving the third tax instalment due date from September 1 to October 1 and Mr. Gazzola indicated this would cost approximately $200,000.00. Moved by Councillor J. Ziegler - "That the due date for the third instalment of City property taxes be moved from September 1 to October 1, 1994." Councillor Ziegler argued that the third instalment should be moved on the basis that summer imposes a different set of circumstances and budget demands than the other due dates. Councillor Lorentz inquired as to the ramification of every taxpayer in the City using the monthly billing system. Mr. Gazzola replied that from a cashflow standpoint the 1. 1994 OPERATING BUDGET (cont.) City would end up losing interest income. Councillor Lorentz indicated his opposition to the motion, noting that people should be on the monthly billing system and that staff should be encouraging this as an alternative to lump sum payments. Councillor Ziegler accepted as a friendly amendment a suggestion from Councillor Zehr that the due date be moved from September 1 to September 15 rather than to October 1. Mr. McKay noted that approximately 40% of taxes are already paid monthly through mortgage companies who would be the biggest beneficiary of any changes to the present system. The previous motion by Councillor Ziegler was voted on as amended and . LOST The Committee reviewed List B and List Z for the General Revenues and Expenses portion of the budget. Councillor Ziegler referred to the summary of conferences and staff training circulated this date, noting a combined yearly expenditure of $536,000.00. He offered the opinion that a $25,000.00 reduction as suggested in List B is a small concession. He also suggested that Council members reduce their annual attendance at conferences to a maximum of 2 per year. Mr. McKay pointed out that the current budget does not support three conferences per year per Council member. FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 137 -DECEMBER 10, 1993 Councillor Ziegler suggested a City-wide reduction in the conference budget arguing that information obtained in this way can be received by other means. Councillor Wagner argued that reducing the training budget would be contrary to the direction taken by every other corporation, and suggested that information received outside of a conference is not as timely. Councillor Stortz suggested that a $25,000.00 reduction is responsible and noted that Councillors normally attend in their capacity as delegates of Council. Moved by Councillor B. Stortz - "That the 1994 corporate training and conferences budget be reduced by $25,000.00." Moved by Councillor J. Ziegler - "That the 1994 corporate training and conferences budget be reduced by $50,000.00" Speaking to the amendment, Councillor Galloway indicated his support and argued that this would not lead to a decrease in training benefit. He also referred to his previous suggestion that the Council training budget be reduced by 25%, noting that in his experience travel and training are to some extent viewed as perks. Mr. McKay pointed out that approximately $100,000.00 of the training budget is allocated to safety training for staff working in the Gas and Water Utilities. The amending motion by Councillor J. Ziegler to reduce the training and conference budget by $50,000.00 was voted on and . LOST The original motion by Councillor B. Stortz to reduce the corporate training and conference budget by $25,000.00 was voted on and . CARRIED The Committee then considered List Z and Mr. Gazzola noted that 1994 is the final catchup year in the City's prior commitment to the K-W Symphony and involves an increase of approximately $15,000.00. He added that all remaining grants have been budgeted at the 1993 level. Mr. McKay suggested that if the amount to the Symphony is increased, decreases should be made in other areas involving either direct grants or contingencies. Councillor Zehr advised that he had spoken with Mayor Turnbull and Councillor McKinnon of the City of Waterloo and noted that they had expressed uneasiness over the proposed increase. It was suggested that the outstanding amount be spread over the years 1994 and 1995 with $7,500.00 allocated in each year. 1. 1994 OPERATING BUDGET (cont.) On a motion by Councillor B. Stortz - It was resolved: "That in keeping with a prior commitment made to the K-W Symphony, the City pay the additional $15,000.00 owing but change the payment schedule in order that the overall grant allocation is increased by $7,500.00 in 1994 and an additional $7,500.00 in 1995." Councillor Galloway questioned whether there is a statutory requirement relative to the Elderly Tax Credit which presently costs the municipality approximately $30,000.00 a year. Councillor Zehr replied that to the best of knowledge there is no statutory requirement and Mr. den Ouden added that there are only three municipalities in Ontario that pay the Credit. He added that application is required every year and only seniors receiving Old Age Security, a pension supplement and who meet the Provincial means test qualify. Councillor Galloway acknowledged that individuals qualifying are living at or below the poverty line, but expressed the opinion that the City is not in the business of providing social services and that this item could be referred to the Region. Councillor Ziegler suggested that the Tax Credit could be phased out if new applications are not accepted after 1993. Councillor Stortz expressed the opinion that this is a token amount and that the people who receive the Credit are in need. Councillor Ziegler responded that the $30,000.00 amount does not include the administrative cost of the Program. Councillor Ziegler put forward a motion to phase out the Elderly Tax Credit by not accepting new FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 138 -DECEMBER 10, 1993 applications after 1993. The motion was voted on and . LOST Councillor Zehr referred to the staff report circulated this date concerning the Humane Society contract. Mayor Cardillo suggested that small animal traps be provided to residents free of charge and Councillor Stortz noted that the rental fee for traps is nominal. Moved by Mayor D.V. Cardillo - "That the K-W Humane Society be asked to consider providing as a service and at no cost, small animal traps for use by Kitchener residents and advise the municipality of any additional charge in this regard." Councillor Leadston indicated that he wished to see the Humane Society report on the cost of providing the trap and removing the animal when caught. Councillor Zehr clarified that the City is asking for information only at this time. The previous motion by Mayor D.V. Cardillo requesting that the Humane Society consider providing small animal traps as a service was voted on and . CARRIED Councillor Ziegler indicated that he was satisfied with the report submitted by the Kitchener Public Library Board dated December 10, 1993 concerning its 1994 Operating Budget. Councillor Galloway expressed concern over the nature of Council's control with respect to KPL expenditures. He also questioned the appropriateness of the recent position title change from "Chief Librarian and Secretary-Treasurer" to "Chief Executive Officer". Mr. McKay responded that he is not sure of the rationale for the change but does not believe there is an associated cost. Councillor Galloway indicated he could accept the change if no additional costs are involved. Councillor Wagner indicated that he would pass the concerns of Councillor Galloway along to the Board at its next meeting. Councillor Leadston suggested that Council give consideration to appointing a KPL Board representative yearly to insure a broader exposure to KPL activities by all Council members. Councillor Zehr referred to an E-Mail message from Mr. T. McCabe in which he indicated the cost of Stage 7 (Comprehensive Zoning By-law) is $79,000.00 not $135,000.00 as previously indicated. 1. 1994 OPERATING BUDGET (cont.) Councillor Zehr reviewed the list of 21 suggestions he compiled at the Finance and Administration Committee on November 1, 1993, noting that the issue of a reduction in staff subscription and association fees is outstanding. Mr. Gazzola replied that a report would be available for consideration on Budget Day. Councillor Zehr inquired as to the cost of inviting former retirees and their spouses to the Recognition Dinner and Mr. McKay advised that he had received a report outlining options for keeping the event costs within the $28,000.00 budget. He noted that the issue would be brought forward to a future meeting of the Finance and Administration Committee, including the past retiree issue referred to by Councillor Zehr. Councillor Wagner put forward a motion that retirees be invited to the Recognition Dinner only in the year of their retirement and that the prohibition on multiple invitations does not apply to staff being recognized for 5, 10 and 15 years of service. Councillor Leadston suggested that Mr. McKay discuss the situation with the organizers and submit a report on the financial impact of repeat invitations. Mr. McKay indicated that a report would be available for consideration at the January 17, 1994 Finance and Administration Committee meeting. Councillor Ziegler indicated that as a matter of principle retirees should be allowed to attend subsequent dinners, but at their own expense. Councillor Wagner agreed to amend his previous motion to incorporate the suggestion of Councillor Ziegler. On a motion by Councillor B. Stortz - It was resolved: FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 139 -DECEMBER 10, 1993 "That consideration of whether retired City employees should be invited to attend subsequent Recognition Dinners at the City's expense be deferred and referred to the January 17, 1994 meeting of the Finance and Administration Committee pending a staff report." Councillor Galloway noted that the list of 21 items referred to by Councillor Zehr does not include his suggestion involving compression at the managerial and supervisory levels. He referred to a resolution in this regard and cited Page 90 of the November 1, 1993 Finance and Administration Committee minutes and suggested that this area needs to be examined and discussed at a later date. Councillor Galloway also referred to Item #19 relative to the Housing Division. Councillor Stortz advised that the Division will come under review in the near future as a result of changes in the Planning and Development Department. Councillor Galloway stated that he has brought this issue forward on a number of occasions and does not understand the non-Kitchener Housing Inc. function of the Housing Division, noting that no one has taken the initiative to inform him. He suggested that two recent documents produced by the Division, namely, the Municipal Housing Statement and Intensification Study are totally redundant and have no impact on the City of Kitchener. Councillor Yantzi questioned the statement relative to redundancy of the Intensification Study and asked whether Councillor Galloway has spoken with Housing staff. Councillor Stortz suggested that Councillor Galloway should investigate the situation further. Mr. Gazzola reviewed the 1994 Reserve and Reserve Fund budget on a fund by fund basis. In response to a question concerning the $125,000.00 allocation in the Telephone Reserve Fund for voice mail, Mr. McKay advised that staff are hoping to have the system in place by March 31, 1994 and referred to several advantages of the system. Councillor Lorentz pointed out that in his experience one of the downfalls of voice mail is that it is left on too often. Councillor Leadston offered the opinion that this feature is ideal and contributes to the efficiency of a workplace from both public and staff perspective. Mr. Gazzola clarified that this item 1. 1994 OPERATING BUDGET (cont.) should have been in the Capital Forecast but came forward after it had been prepared. He noted that the dollar amount is a rough estimate and that Council will have an opportunity in future to respond to the tender submissions. Mr. McKay added that voice mail was requested of the Information Services Division last Spring, but due to other projects was delayed in reaching Council. Councillor Zehr indicated that he was surprised this had not been discussed at the Committee level and noted that Council have not received a report to date. On a motion by Councillor B. Stortz - It was resolved: "That prior to tendering for a voice mail system staff prepare and submit a report on its feasibility for consideration at a future meeting of the Finance and Administration Committee." Mr. McKay added that the report would come forward as soon as proposal documents are available. Mr. Gazzola reviewed the Tax Stabilization Reserve Fund, noting a decrease in the 1993 surplus. He advised that the worst case scenario has been budgeted and if there are no further surplus problems in 1994, he anticipates there will be approximately $712,000.00 remaining at the end of that year. Councillor Stortz questioned the reason for the reduced surplus and Mr. Gazzola indicated a lower percentage of Department budget surpluses due to the recession and a larger number of write-offs involving supplementary taxes. Councillor Zehr referred to the Election Reserve Fund and suggested that there should be a $73,000.00 credit to the Operating Budget. He noted that if the cost of an election is $211,000.00, he does not agree with the statement as shown. Mr. McKay indicated that staff would investigate and report back. Councillor Zehr asked for a report on Budget Day clarifying the figures in the Sick Leave Reserve FINANCE AND ADMINISTRATION COMMITTEE MINUTES- 140 -DECEMBER 10, 1993 Fund statement. Mr. McKay pointed out that staff will not necessarily have the liability calculated by December of 1994. Councillor Zehr summarized the difference between the 1993 and 1994 budgets with and without Expenditure Control Plan reductions, and noted a net reduction in City expenses of $500,000.00 or point .6%. Mr. Gazzola added that at present the City's portion of the tax bill would increase by .85% or approximately $8.72 on the average tax bill. He added that this is based on assessment growth of .25%. In response to a question from Councillor Stortz, Mr. Gazzola advised that final assessment figures must be returned to the City by December 21, 1993. On a motion by Councillor B. Stortz - It was resolved: "That Council adopt the 1994 Operating Budget as recommended by the Administrative Review Committee and amended by the Finance and Administration Committee." 2. NEXT MEETING The 1994 Capital and Operating Budgets will be considered by City Council on Friday, January . 21, 1994 3. ADJOURNMENT On motion, the meeting adjourned at 3:45 p.m. ________________________________ G. Sosnoski Manager of Corporate Records/Assistant City Clerk