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HomeMy WebLinkAboutFCS Minutes - 2023-11-20 - Operating Budget Finance and Corporate Services Committee Minutes November 20, 2023, 10:00 a.m. Council Chambers - Hybrid City of Kitchener 200 King Street W, Kitchener, ON N2G 4G7 Present: Mayor B. Vrbanovic Councillor S. Davey Councillor D. Schnider Councillor J. Deneault Councillor C. Michaud Councillor A. Owodunni Councillor P. Singh Councillor B. Ioannidis Councillor M. Johnston Staff: D. Chapman, Chief Administrative Officer M. May, General Manager, Community Services and Deputy Chief Administrator J. Readman, General Manager, Development Services J. Lautenbach, Chief Financial Officer, Financial Services D. McGoldrick, General Manager, Infrastructure Services B. Cronkite, Director, Transportation Services B. Cheyne, Director, Sport R. Hagey, Financial Planning D. Andrade, Manager, Budgets D. Saunderson, Deputy Clerk M. Blake, Committee Administrator M. Mills, Committee Administrator _____________________________________________________________________ 1. Commencement 1 The Special Finance and Corporate Services Committee held a meeting this date commencing at 10:07 a.m. 2. Disclosure of Pecuniary Interest and the General Nature Thereof None. 3. Discussion Items 3.1 2024 Operating Budget, FIN-2023-510 3.1.a General Overview by the Chief Financial Officer J. Lautenbach provided an overview of the budget process including the changes as a result of the Strong Mayor Act Legislation. J. Lautenbach stated for 2024, staff would be provided presentations on the Operating and Capital Budget on November 20th and 27, 2023, which would be followed by a presentation from Mayor B. Vrbanovic on December 4, 2023, where the Mayor will table the budget. It was noted once the budget was tabled, members of Council could forward any proposed amendments they would like to be considered to the Clerk no later than December 11, 2023 and on Final Budget day, Council will have the opportunity to vote on the amendments, or the Mayor can exercise their Veto right on the proposed amendments. Pending the outcomes of the proposed amendments considered on December 14, 2023, the Budget will be automatically adopted on December 29, 2023. J. Lautenbach presented a summary of the overall budget overview, noting the 2024 budget priorities include: Supporting City Services, Focusing on Infrastructure and Advancing Strategic Priorities. J. Lautenbach spoke to the inflationary pressures on the budget for 2024, including an inflation rate of 4%. J. Lautenbach stated, staff through this budget, have attempted to address those pressures, while balancing the City's needs with proposing a 3.9% property tax rate increase. J. Lautenbach further advised the draft 2024 budget, including utility rate increases represents a combined annual increase of $124 for the average household, based on the average assessed value of $326,000 and annual water consumption of 170m3. J. Lautenbach summarized the 2024 budget maintains existing programs and services for residents, addresses inflationary pressures and is below the rate of inflation. J. Lautenbach then responded to questions from the Committee. Councillor S. Davey left the meeting at this time and vacated the Chair. Councillor B. Ioannidis assumed the Chair at this time. Councillor S. Davey returned to the meeting at this time and assumed the Chair. 2 At the request of Councillor S. Davey, for Final budget day, asked that staff prepare an educational slide on the total tax rate increase for 2024, to demonstrate the overall tax rate increase and the percentage associated to the City, Region of Waterloo and School boards. 3.1.b Boards 3.1.b.a Kitchener Public Library (KPL) Mary Chevreau, Kitchener Public Library (KPL) was in attendance to provide an overview of the 2024 Kitchener Public Library (KPL) budget and to respond questions from the Committee. M. Chevreau stated the 2024 budget includes base operating grant within the 3.9% City Guidelines, takes into consideration growth funding of $119K for the new south end library branch; and, implements their new salary scale planned for summer 2024. M. Chevreau responded to questions from the Committee. Councillor A. Owodunni left the meeting at this time. Councillor B. Ioannidis left the meeting at this time. Councillor J. Deneault raised questions about the Library Collections at Community Centre's program and whether consideration could be given to adding a partnership with Kingsdale Community Centre. M. May stated staff, in consultation with the KPL, will review options to consider whether additional sites could be included in the program, stating if any additional sites are included, it would be better to run them for a two-year program to getter a better understanding of the overall success of the program. Councillors A. Owodunni and B. Ioannidis re-entered the meeting at this time. 3.1.b.b Centre in the Square (CITS) Dan Carli, Board Chair, Joe Henning and Sylvia Cook, Centre in the Square (CITS) were in attendance to provide an overview of the 2024 CITS budget and to respond questions from the Committee. D. Carli stated the budget includes a base operating grant within the 3.9% as per City Guidelines, stating for 2024, the Centre is actively working towards filling vacancies in the calendar resulting from KW Symphony closure; and, preparing for new leadership change in early to mid-2024. D. Carli and J. Henning then responded to questions from the Committee. Councillor D. Schnider left and re-entered the meeting at this time. 3 3.2 Recess and Reconvene The Finance and Corporate Services Committee then recessed at 11:35 a.m. and reconvened at 12:38 p.m., Chaired by Councillor S. Davey, with all members present except Councillor D. Chapman and Councillor A. Clancy. 3.3 Strategic Investment Options R. Hagey provided an overview on the Strategic Investment options, stating there is $1M within the budget that is unallocated for Council to use to advance various strategic priorities. R. Hagey stated staff have provided 10 potential options that total $2M for Council's consideration. R. Hagey stated Issue Paper Op 02 - Strategic Plan Spending Options, has been included in the budget materials as Appendix F, which includes a summary of the available options for the unallocated funding. S. Davey requested members of the Committee ask questions and speak to the investment options that were both of higher and lower priority to provide an indication of the strategic priorities that were of interest for funding in 2024. Several members expressed support for the following strategic priorities being of interest to receive funding: improving access to Cameron Heights Pool; supporting trail connections; technology improvements outlined under Option E - Stewarding a Better City Together; and, playground replacements. Some concerns were raised with additional funding being being allocated for cycling infrastructure beyond the funding already allocated within the budget, noting if active transportation was being further advanced, the focus should be on trails. Questions were raised related to accelerated Commercial Building Approvals and whether it could be addressed through the Building Enterprise, J. Readman indicated that matter could be taken back, and staff could provide a follow-up response on that matter. 3.4 Tax Supported Operating Budget R. Hagey then provided an overview of the Tax Levy and factors that are taken into consideration for establishing the property tax rate increase; and, included a general overview of the user fees, indicating, generally, the fees are being 4 increased by 4%, which is in line with inflation. R. Hagey stated, as a reminder, the City collects all of the local property taxes, but only makes up a fraction of the total tax bill, noting the Region of Waterloo accounts for 55% of the local tax bill, so changes to their budget have a much more significant impact to homeowners than changes to the City budget. R. Hagey further advised budget changes by division can be found in Appendix B of the budget materials and user fees can be found on pages 9-13 of Appendix F. It was noted Issue Paper Op 03 - User Fees, highlights exceptions to the user fees that with a greater than 4% increase. In response to questions, D. Chapman stated staff could review the discussion related to the funding that was initially allocated to the Kitchener Waterloo Symphony to confirm the direction on its future reallocation. Questions were raised related to user fees within Planning and whether some of those fees could be reviewed and possibly increased to address the Housing for All Strategic Plan initiatives. J. Readman stated those fees operate on a cost recovery model and are subject to legislation. J. Readman stated staff could take that comment back to review potential options as a means to accelerate that strategic priority. 3.5 Enterprise Operating Budgets - Building, Golf and Parking R. Hagey provided an overview of the City's Enterprises, noting the Enterprises are self-sufficient business lines that raise their own revenues through user rates rather than being funded through property taxes. R. Hagey commented the tax base has received dividends from some enterprises, where not prohibited by legislation including Golf, Parking & Natural Gas. R. Hagey stated dividend amounts for 2024 have been adjusted based on enterprise performance as follows: Golf: dividend eliminated ($75k); Parking: dividend reduced by $600k (from $2M to $1.4M); and, Gas: dividend held flat at 2023 level ($15.8M). R. Hagey stated each of the 7 enterprises: Building, Golf, Parking, Water, Sanitary Sewer, Stormwater and Natural Gas, have information summarized on a slide similar to the presentation this date in the budget materials. R. Hagey, B. Cronkite and J. Readman responded to questions from the Committee related to the Golf Enterprise and Parking Enterprises, specifically related to their deficits. 3.6 Recess and Reconvene The Finance and Corporate Services Committee then recessed at 1:58 p.m. and reconvened at 2:07 p.m., Chaired by Councillor S. Davey, with all members present except Councillor D. Chapman and Councillor A. Clancy. 3.7 Enterprise Operating Budgets (Cont'd) - Water, Sanitary Sewer, Stormwater and Natural Gas 5 R. Hagey addressed the Water, Sanitary and Stormwater Enterprises, noting the information that Council received earlier this date related to the Water Infrastructure Program (WIP) Rates remains unchanged from what was provided earlier in the year at a Strategic Session. 3.8 Next Steps It was noted the next meeting to review the budget would be a Special Finance and Corporate Services meeting on November 27, 2023 to consider the Capital Budget and 10-year Forecast and Public Budget input Session that same date. Following that meeting, there would be a Special Council meeting on December 4, 2023, where the Mayor will table the 2024 budget. Member of Council will be required to send any proposed amendments to the 2024 budget to the Clerk no later than December 11, 2023, which will then be considered at a Final Budget meeting on December 14, 2023. 4. Adjournment On motion, this meeting adjourned at 2:24 p.m. Dianna Saunderson Manager of Council/Committee Services & Deputy Clerk 6