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HomeMy WebLinkAboutFCS Minutes - 2020-11-30 - Operating BudgetSPECIAL FINANCE & CORPORATE SERVICES COMMITTEE MINUTES NOVEMBER 30, 2020CITY OF KITCHENER The Special Finance and Corporate ServicesCommittee held an electronic meetingthis date, commencing at 12:34p.m. Present:CouncillorS. Davey-Chair Mayor B. Vrbanovic andCouncillorsD. Chapman,K. Galloway-Sealock,J. Gazzola, B. Ioannidis,M. Johnston, S. Marsh, C. Michaud, D. Schnider andP. Singh. Staff:D. Chapman, Chief Administrative Officer M. May, Deputy CAO & General Manager, Community Services V. Raab, General Manager, Corporate Services J. Readman, General Manager, Development Services J. Lautenbach, Chief Financial Officer, Financial Services D. McGoldrick, General Manager, Infrastructure Services R. Hagey, Director, Financial Planning M. Seiling, Director, Building K. Kugler, Director, Enterprise G. St. Louis, Director, Utilities B. Lam, Directory, Sanitary & Stormwater Utilities N. Lobley, Director, Parks and Cemeteries B. Cronkite,Director, Transportation Services P. McCormick, Manager, Parking Enterprise J. Bunn, Manager, Council and Committee Services/Deputy City Clerk D. Saunderson, Committee Administrator S. Goldrup, Committee Administrator 1.FIN-20-066-2021OPERATING BUDGET The Committee considered Financial ServicesDepartment report FIN-20-066, dated November 16, 2020, concerning the City’s 2021Operating Budget proposing a tax levy increase of 1.1%, together with nine Operating Budget Issue Papers. Councillor S. Davey advised the meeting held this date will be mostly for informational purposes, and the Capital Budget meeting will allow Council the opportunity tobring questions forward.He further noted the Final Budget meeting in January will provide the opportunity forCouncil to make decisionson the City budget. GENERAL OVERVIEW D. Chapman presented a general overview ofthe Operating Budgetand advised theCity is making balanced and intentional choices about the2021budget, stating staff have made a conscious decision not to cut valued community services when they are most needed. He provided an overview of the overall budget, including:respectingourtaxpayers by having the lowest proposed annual impact to the homeowner ($34 inclusive of tax, water, sewer, storm and natural gas rate changes) in the past decade; maintaininghighly valued community programs and services –a priority for Kitchener citizens based on consistent feedback;focusingtargeted financial support on our most vulnerable citizens by investing in resources to support business recovery, promote equity, diversity and inclusion, and prioritize affordable housing; and, continuingto advance our strategic and community goals. Councillor P. Singh entered the meeting at this time. J. Lautenbach advised the 2021Budget is made up of three components: Operating Budget; Capital Budget; and, reserve funds.He provided an overview of the financial impacts due to the global pandemic, which included: a review of previous years surpluses/deficits; the mitigation measures taken in 2020 to manage the City’s financial position;as well as,the 2021 global pandemic pressures and impacts.J. Lautenbachprovided an overview of the proposed budget increase, stating the household impact including taxes, water utilities and gas would have an average impact of $34 per household. In response to questions, R. Hagey agreed to provideadditional information on the$1.6M General Expense -Otherand what was included within that line itemnoted on page O -19 of the budget agenda. SPECIAL FINANCE & CORPORATE SERVICES COMMITTEE MINUTES NOVEMBER 30, 2020-20-CITY OF KITCHENER 1.FIN-20-066-2021 OPERATING BUDGET(CONT’D) BOARDS Kitchener Public Library (KPL) The Committee considered the KPL’s 2021 budget, including Issue Paper OP-01 (Eliminating Overdue Material Fines) regarding eliminating overdue fines for borrowing. M. Chevreau and A. Riddell,Kitchener Public Library (KPL), were in attendance in regard to the 2021 KPL’s budget andrespondedto questions from the Committee.M. Chevreaurequested for 2021 Council consider approving the removal of fines related to overdue borrowing, stating fines are an equity barrier for members of our community from people accessing library services. It was noted the overdue fines represents $163,000. of the KPL’s budget, that would have minimal impact as the Library is proposing to add a new special event rental fee that should in the future offset that revenue line. M. Chevreaufurther advised a number of libraries have already taken this approach since the global pandemic began, as a means of removing barriers for access for all members of the community, specifically those of low-income households that have overdue fines. To address the shortfall in the loss over overdue fines, the library was requesting an increase to the operating grant of $100,000.; as well as, using the balance of the surplus from staffing due to the pandemic which resulted in the library being closed for approximately 5 weeks. In response to questions, M. Chevreau agreed to provide a revisedbudget to reflectwhat the impacts of elimination of fines would have on their overall 2021 Budget. Centre in the Square (CITS) The Committee considered the CITS’s 2021 budget, including Issue Paper OP-02(Continuing Transitional Funding for Centre in the Square)regarding the transitional funding and possible options related to any 2021 surplus or deficits. P.Salvini,R. Sonoda,D.Dauband E. Sproule, Centre in the Square (CITS), were in attendance and responded to questionsfrom the Committee.P. Salvini provided an overview on the 2021 budget, statingthe budget included in the agenda package includes an assumption that shows and eventscould commence in March 2021 at 40% capacity. It was noted as the second wave of the global pandemic continues to evolve,it is anticipated at this time that showsand events will not likely commence until September 2021 or even possibly January 2022. In response to questions, P. Salvini agreed to provide a revised budget to reflectthe impacts on the2021 budget if the CITSdoes not commence operation untilJanuary 2022. TAX SUPPORTED OPERATING BUDGET Mr. Hagey advised staff considered the following when preparing the draft 2021tax rate: municipal comparisons; inflationary factors, including those unique to municipalities; and, a balanced level of service provided with taxpayer’s willingness and ability to pay. The presentationhighlighted the 2020Regional Average Household Comparison, which identifies Kitchener as being an affordable city in which to live.R. Hagey statedthat a levy increase or decrease of 1% amounts to nearly $1.3M in the City budget. The Committee considered Issue Paper OP-03 (Growth in City Parks & Trails) which recommends approving 4 new full-time equivalent (FTE) staff to address the rapid growth in park land amenity spaces, trails and other outdoor infrastructure. In response to questions, staff agreed to provide an Issue Paper for Final Budget dayoutlining the financial impacts of freezing increases for Council and non-union staff salaries for 2021. Questions we raised regarding the Working Centre's community assisted snow clearingprogram and whether additional capacity could be identifiedfor the 2020-2021 winter.N. Lobleyagreed to provide an Issue Paper for Final Budget day outlining the overall impact ofadding 25additional spaceswithin that program. SPECIAL FINANCE & CORPORATE SERVICES COMMITTEE MINUTES NOVEMBER 30, 2020-21-CITY OF KITCHENER 1.FIN-20-066-2021 OPERATING BUDGET (CONT’D) The Committee recessed at 3:40p.m. and reconvened at 3:46p.m. Chaired by Councillor S. Davey with all members present. ENTERPRISE OPERATING BUDGETS R. Hagey gave an overview of the financial positions of the City’s enterprises, advising only two of the seven enterprises are projected to have a negative stabilization reserve at the end of the year, stating ideally it is preferred that all of the enterprises are in a positive position within the short term planning horizon, indicating that may be challenging due to the current financial challenges related to the global pandemic. Building R. Hagey provided an overview of the Building Enterprise budget for 2021. M. Seilingwas in attendance and responded to questions from the Committee, noting he Building Enterprise is proposing lowering building permitfees by 10% for most fees in 2021. Golf R. Hageyprovided an overview of the GolfEnterprise, noting the 2021 Golf budget includes Safe Restart Phase 1 funding to assist in reducingits projected 2020 deficit to $260,000.K. Kugler was in attendance torespond to questions from the Committee. Parking R. Hagey provided an overview of the Parking Enterprise budget.In response to questions, R. Hagey advised if the City receives Safe Restart Phase 2 Funding,staff intend on allocating approximately 1.3M to the Parking Enterprise.In response to further questions, R. Hagey advised it is anticipated that staff will receive a responsefrom the Provinceon the Phase 2 Funding prior to the end of 2020, noting if funding is approved,staff will provide updated budget information for Final Budget day to reflect theadditional funding.B. Cronkitewas in attendance to respondto questions from the Committee. Gas Works Utility R. Hagey provided an overview on the Gas Works Utility Enterprise budget. G. St. Louis was in attendance and responded to questions from the Committee. Water, Sanitary and Stormwater Utilities R. Hagey provided an overview of the Water, Sanitary and Stormwater Program, stating the program has been considered as one entity since the Water Infrastructure Program (WIP) review. G. St. Louis and B. Lam were in attendance to respond to questions from the Committee. In response to questions, D. McGoldrick agreed to provide additional information on the City's progress towards its road reconstruction goals, specifically regardingthe number of kilometres that have been completed versus what was planned. Councillor K. Galloway-Sealock questioned whether there were additional options to possibly reduce the proposed stormwater rate increase from 0.9% to 0%. Staff agreed to provide additionalinformation about how reductions in either Water or Sanitary could offset the proposed stormwaterrate increase. Councillor D. Chapman brought forward a request to direct staff to complete an Issue Paper on the possibility of reducing the tax levy from 1.1%,as proposed,to 0%, noting wage freezes, reducing the reliance on consultants and freezing new programs as a means of achieving that reduction. In response to questions, J. Lautenbachadvised the only way to achieve a 0% tax increase SPECIAL FINANCE & CORPORATE SERVICES COMMITTEE MINUTES NOVEMBER 30, 2020-22-CITY OF KITCHENER 1.FIN-20-066-2021 OPERATING BUDGET(CONT’D) would involve a reduction in services, noting the staff would have to cut services in the amount of $1.4M. It was noted the rate increase proposed by staff is intended to retain existing service levels. Councillor S. Davey stated wherea request for an Issue Paper has been identified by staff as beingonerous or requiring asignificant amount of staff time, he requested the Committee vote on the Issue Paper to confirm whether it was the will of Committeeto proceed with the direction. Councillor Chapman’s request for an Issue Paperrelated to possibly reducing the tax levy from 1.1% to 0%was then voted on and was LOST. Councillor B. Ioannidis requested an Issue Paper related to increasing Small Scale Traffic Calming budget by 15%, 25%, and 50%. Councillor S. Marsh requested an Issue Paper outlining the financial impacts of freezing increases for Council and non-union staff salaries for 2021. D.Chapman stated staff have no objections with Councillor Marsh’s Issue Paper request, stating it is likely a matter that will also need to be considered in caucus as there also may be some labour relation and pay equity matters that would impact Council’s decision. CONCLUSION It was noted the direction from the Special Finance and Corporate Services Committee meeting this date would be forwarded for consideration to a Special Council meeting later this date, to direct staff toreport and/or take appropriate action on the following matters relative to the 2021 Operating budget, as outlined in the chart below: Division/AreaTopicAction Provide additional information on the items included in$1.6M budget for General General Expense Expense –Otheron page O-16 of the agenda package. Provide a revised budget to reflect what the Kitchener Public impacts of elimination of fines would have Library on their overall 2021 Budget. Provide a revised budget to reflect the FINANCIAL Centre in the impacts on the 2021 Budget if the CITS PLANNING Square(CITS)does not commence operation until January 2022. Prepare an Issue paper outlining the financial impacts of freezing increases for Salary & Wages Council and non-union staff salaries for 2021. Winter Prepare an Issue paper outlining the costs INFRASTRUCTURE Maintenance –of adding 25 more spots for the Working SERVICESSidewalk Snow Centre's community assisted snow Clearingclearing. SPECIAL FINANCE & CORPORATE SERVICES COMMITTEE MINUTES NOVEMBER 30, 2020-23-CITY OF KITCHENER 1.FIN-20-066-2021 OPERATING BUDGET(CONT’D) Provide additional information on the City's progress towards its road reconstruction goals, specifically regarding number of kilometres that have been completed INFRASTRUCTURE Water versus what was planned. SERVICESInfrastructure (CONT’D)Program (WIP) Provide information about how reductions in either Water or Sanitary could offset the planned increase in Stormwater. Prepare an Issue paper outlining the TRANSPORTATION impacts of increasing the Small-Scale Traffic SERVICESTrafficCalming budget by 15%, 25%, and 50%. 2.ADJOURNMENT On motion, this meeting adjourned at 5:45p.m. Dianna Saunderson Committee Administrator