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HomeMy WebLinkAboutFinance & Admin - 2001-01-12 SFINANCE & ADMINISTRATION COMMITTEE MINUTES JANUARY 12, 2001CITY OF KITCHENER The Finance and Administration Committee met this date in special session, commencing at 9:23 a.m., chaired by Councillor J. Ziegler with the following members present: Mayor C. Zehr and Councillors M. Galloway, G. Lorentz, J. Smola, B. Vrbanovic and C. Weylie. Others Present:Ms. P. Houston, Ms. G. Luciantonio, Ms. S. Adams, Ms. S. MacDonald, Ms. D. George, Ms. S. Henderson, Ms. F. Currier, Ms. D. Gilchrist and Messrs. J. Gazzola, F. Pizzuto, B. Stanley, J. Shivas, K. Baulk, G. Sosnoski, O. den Ouden, S. Saleh, D. Daly and D. Colwill. The purpose of this special meeting was to review the year 2001 Operating Budget as submitted by the Administrative Review Committee. 1. 2001 OPERATING BUDGET Ms. P. Houston provided an overview of the Operating Budget as submitted by the Administrative Review Committee, noting that the original department estimates resulted in a 7.28% increase which was reduced by the Committee to 4.94%. This will result in an increase in the City’s portion in the tax levy of 4.29% in 2001 net of assessment growth and vacancy rebates. Ms. Houston noted that the City’s tax rate has been below CPI for 1999 and 2000. She also noted that the City’s portion of each tax dollar is 26%. Ms. Houston advised that for budget purposes a 1.09% growth in assessment has been used. Ms. Houston then reviewed the impact of commercial and industrial vacancies on the levy and the application process for those property owners to obtain a tax rebate. She estimated that the total amount of these rebates would be $250,000. or 0.44%. Councillor Vrbanovic questioned whether legislation is pending to require that future tax increases be levied against residential properties only, and Ms. Houston advised that the regulations are not available but she believed this is the case. Ms. Houston then advised that each departments operating budget contains restated figures for the following expenses; computer, telephone, insurance and training. These budget figures now accurately reflect actual charges which have not been adjusted for a number of years. The Committee briefly discussed a reduction in payments for linear properties and payments-in- lieu, Ms. G. Luciantonio advising that it was always known there would be a gradual reduction in these payments over several years; however, hydro deregulation accelerated the rate of reduction. Ms. P. Houston agreed to provide Committee members with a chart showing the rate of reduction for these payments. Ms. Houston reviewed the highlights of the 2001 Operating Budget for the Centre in the Square, noting a 2.3% increase. On motion by Councillor G. Lorentz – : it was resolved “That the 2001 Operating Budget for the Centre in the Square be approved as submitted by the Administrative Review Committee.” Ms. Houston reviewed highlights of the 2001 Operating Budget for the Kitchener Public , noting a 2.8% increase. Library (KPL) Ms. M. Walsh appeared on behalf of the Kitchener Public Library. Mayor Carl Zehr questioned the partnership with the City of Waterloo, which Ms. Walsh advised involves an agreement regarding purchase and maintenance of their automated system and local area network. She advised that the costs in the Budget are actual costs and over time will decrease. On motion by Councillor B. Vrbanovic – : it was resolved “That the 2001 Operating Budget for the Kitchener Public Library be approved as submitted by the Administrative Review Committee.” FINANCE & ADMINISTRATION COMMITTEE MINUTES JANUARY 12, 2001- 14-CITY OF KITCHENER 1. 2001 OPERATING BUDGET (CONT’D) Ms. Houston reviewed the Operating Budget highlights for the , noting a Legal Department 2.2% increase. On motion by Councillor C. Weylie – it was resolved: “That the 2001 Operating Budget for the Legal Department be approved as submitted by the Administrative Review Committee.” Ms. Houston reviewed the 2001 Operating Budget highlights for , noting a 26.5% City Council decrease due to the reduction in the size of Council. She cautioned that some of the $101,000. reduction may be needed depending on the recommendations of the Ad Hoc Adivsory Committee on Council Compensation. On motion by Mayor C. Zehr – it was resolved: “That $101,000. be reinstated in the 2001 Operating Budget for City Council, pending a recommendation from the Ad Hoc Advisory Committee on Council Compensation.” On motion by Mayor C. Zehr – : it was resolved “That the 2001 Operating Budget for City Council be approved as amended this date.” Ms. Houston reviewed highlights of the Operating Budget for the , noting a Mayor’s Office 2.3% increase. On motion by Councillor B. Vrbanovic – it was resolved: “ That the 2001 Operating Budget for the Mayor’s Office be approved as submitted by the Administrative Review Committee.” Ms. Houston reviewed highlights of the 2001 Operating Budget for the , Finance Department noting a 3.9% increase. Councillor Vrbanovic questioned whether staffing levels have been properly adjusted to resolve the customer service issues which arose as a result of implementation of the new tax and utility billing system. Ms. Houston stated that she thought staffing levels were appropriate; although there are still some issues with staff turn-over and sickness. Councillor Vrbanovic suggested a complement of part-time staff who could be trained and substitute when required. Ms. Houston agreed that was a possibility. She also advised that the Department is investigating a new telephone system. Councillor Vrbanovic directed that staff prepare a report for a future Finance and Administration Committee meeting identifying customer service issues in the Finance Department and service standards City-wide. On motion by Mayor C. Zehr – it was resolved: “That the 2001 Operating Budget for the Finance Department be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed the 2001 Operating Budget for the Community Services , noting an overall increase of 8.2%. Department Mayor Zehr questioned the inclusion of “Office Furniture Replacement” in the Operating Budget, noting that such expenditures for other departments are included in the Capital Budget, and Ms. Houston agreed to move this expenditure to the Capital Budget. FINANCE & ADMINISTRATION COMMITTEE MINUTES JANUARY 12, 2001- 15-CITY OF KITCHENER 1. 2001 OPERATING BUDGET (CONT’D) Ms. Houston advised that an additional $4,400. should be added to “Minor Sports Grants”, in the , based on the Community Services Committee Aquatics and Athletics Division consideration of those grants. The Committee then questioned sponsorships for the Festival of the Night. Mr. Baulk advised that costs to the City in 2000 were $65,000. and sponsorships covered an additional $25,000. - $30,000. in costs. Councillor Vrbanovic questioned whether sponsorships could be increased and was advised that this may be possible. Councillor Lorentz requested a staff report for a future Community Services Committee meeting on the direction for Festival of the Night and other special events, including the underlying philosophy. Ms. Houston reviewed the highlights of the , 2001 Enterprise Services Division Operating Budget and Mr. Baulk addressed the “Business Plan Correction” for the Cemeteries Division advising that the Business Plan prepared in 1998 recommended hiring a contract sales associate. This “Business Plan Correction” reflects what has actually happened since that position was approved and projects what will happen in the future. The Committee then questioned the “Graffiti Program” contained in the Parks and . Mr. D. Daly noted that this is a new budget item and the Environmental Services Division $42,000. figure reflects the cost of having City staff remove graffiti. Councillor B. Vrbanovic asked that a detailed report on the Graffiti Program be submitted to a future Community Services Committee meeting. Councillor Lorentz requested that the report include information on the response from other agencies. On motion by Councillor G. Lorentz – it was resolved: “That the 2001 Operating Budget for the Community Services Department, excluding Golf Courses be approved as submitted by the Administrative Review Committee, and amended this date to transfer Office Furniture Replacement costs of $12,000. from the Operating Budget to the Capital Budget, and to increase Minor Sports Grants by $4,400.” Ms. Houston reviewed the highlights of the 2001 Operating Budget for Doon Valley and , noting that the main cost at Doon Valley Golf Course is the 18 hole Rockway Golf Courses expansion. Upon questioning by Mayor C. Zehr, Ms. Houston confirmed that the deficit for this project does not affect the levy. Mayor Zehr then questioned the administration costs outlined in the 10 year projections for both golf courses and requested additional details. On motion by Councillor G. Lorentz – it was resolved: “That the 2001 Operating Budget for Doon Valley Golf Course and Rockway Golf Course be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed the highlights of the 2001 Operating Budget for the various divisions within the , noting an overall increase of 5.5%. She Corporate Services Department then reviewed budget highlights of the City Clerks Division, noting an increase of 7.8%. On motion by Councillor B. Vrbanovic – it was resolved: “That the 2001 Operating Budget for the City Clerk’s Division be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed highlights of the 2001 Operating Budget for the Facilities FINANCE & ADMINISTRATION COMMITTEE MINUTES JANUARY 12, 2001- 16-CITY OF KITCHENER 1. 2001 OPERATING BUDGET (CONT’D) , noting a 1.3% increase. Management Division On motion by Councillor M. Galloway – it was resolved: “That the 2001 Operating Budget for the Facilities Management Division be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed the highlights of the 2001 Operating Budget for the Human , noting an 11.7% increase. Councillor Lorentz questioned the increased Resources Division costs for the Recognition Dinner and Ms. Houston advised that the costs have been higher over the last few years, with the increase having been charged to the Sick Leave Reserve Fund. She advised that for 2001, appropriate costs have been included in the Division’s Operating Budget. On motion by Councillor B. Vrbanovic – it was resolved: “That the 2001 Operating Budget for the Human Resources Division be approved as submitted by the Administrative Review Committee.” Ms. Houston reviewed the highlights of the 2001 Operating Budget, noting Fleet Division’s no increase over 2000. On motion by Mayor C. Zehr – it was resolved: “That the 2001 Operating Budget for the Fleet Division be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed highlights of the 2001 Operating Budget for the Business and , noting an overall increase of 3%. She pointed out that Planning Services Department Compass Kitchener was originally a one-time project included in the Capital Budget which has now been moved from Capital to Operating. When questioned by Councillor J. Ziegler, Mr. B. Stanley advised that the Compass Kitchener staff position is still a temporary position, which is reviewed every 10 months. Further, Mr. Stanley advised that this position is to be reviewed at the end of this month, and if the budget is approved will be renewed for another 10 month period. Councillor G. Lorentz requested that Compass Kitchener and Festival of the Night be highlighted for Budget Day. Following further discussion Councillor Vrbanovic requested that staff provide the Mayor’s Office with one full, hard copy of the proposed 2001 Budget. On motion by Councillor C. Weylie – it was resolved: “That the 2001 Operating Budget for the Business and Planning Services Department be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed highlights of the 2001 municipal appropriations for the K-W and , noting a 5.1% increase for the K-W Humane Society Humane SocietyK-W Tourism and no increase over 2000 for K-W Tourism. It was pointed out that the Community Services Department still requires $37,000. for its own marketing, and as requested by Council, staff will report by the end of 2001 on delivery options with respect to tourism. FINANCE & ADMINISTRATION COMMITTEE MINUTES JANUARY 12, 2001- 17-CITY OF KITCHENER 1. 2001 OPERATING BUDGET (CONT’D) On motion by Councillor B. Vrbanovic – it was resolved: “That the 2001 Municipal Appropriations for K-W Humane Society and K-W Tourism be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed highlights of the 2001 Operating Budget for the Chief , is noting a 9.3% increase. Administrative OfficerDepartment On motion by Councillor C. Weylie – it was resolved: “That the 2001 Operating Budget for the Chief Adminstrative Officer’s Department be approved as submitted by the Administrative Review Committee.” Ms. P. Houston then reviewed the Budget for , noting an General Revenues and Expenses increase of 23.4%. Mayor Zehr advised that he wished to have more information on “gapping” and asked that this be highlighted for Budget Day. Ms. Houston advised that she would provide the exact figures for gapping for the year 2000. On motion by Councillor B. Vrbanovic – it was resolved: “That the 2001 General Revenues and Expenses be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed the . She noted that the City Reserves and Reserves Funds existing Insurance Pooling Agreement will expire at the end of May 2001, and staff will bring a report to the Finance and Administration Committee in March to advise of the Pooling Fees proposed for the next three years. With respect to the , Ms. Houston noted Workplace Safety & Insurance Board (WISB) Fund that the City now pays only for the costs of claims rather than a yearly rate. Mayor Zehr questioned whether the insurance costs for this purpose are only for disaster claims. Ms. Houston responded that if one claim goes over a specified amount or if the cumulative claims are over a specific amount then the insurance covers this amount. Mayor Zehr questioned whether WSIB insurance could be purchased through the Insurance Pool and Ms. Houston advised that this is significantly different from the types we are purchasing through the Pool and it would have to be a separate policy. The Committee generally agreed to take no action at this time, with respect to the City Reserves and Reserve Funds until they have considered the Tax Stabilization Reserve Fund later this date. This meeting of the Finance and Administration Committee recessed at 12:20 p.m. and reconvened at 1:10 p.m. with the following members present: Mayor C. Zehr and Councillor J. Ziegler, B. Vrbanovic, J. Smola, G. Lorentz, C. Weylie and M. Galloway. The Committee then continued its review of the 2001 Operating Budget and Ms. Houston reviewed the highlights for the , noting an increase of 3.6%. She noted that Fire Department Fire Alarm Monitoring is now a stand-alone enterprise and advised that a deficit is being projected for 2001, but over time, they are expecting a profit. On motion by Councillor M. Galloway – it was resolved: “That the 2001 Operating Budget for the Fire Department be approved as submitted by the Administrative Review Committee.” FINANCE & ADMINISTRATION COMMITTEE MINUTES JANUARY 12, 2001- 18-CITY OF KITCHENER 1. 2001 OPERATING BUDGET (CONT’D) Ms. Houston then reviewed highlights of the 2001 Operating Budget for the Public Works , noting a 4.5% increase. Department Mr. S. Gyorffy advised that a new position of “Site Development Officer” will be changed to a “Corridor Management Technologist” and the cost of the position will be covered by an increase in revenues. He advised that a report in this regard will be presented at the January 22, 2001 Finance and Administration Committee meeting. On motion by Councillor J. Smola – it was resolved: “That the 2001 Operating Budget for the Public Works Department, excluding Gasworks, Waterworks and Sewer Surcharge, be approved as submitted by the Administrative Review Committee.” Ms. Houston reviewed the highlights of the 2001 Operating Budget for the . Gasworks On motion by Councillor G. Lorentz – it was resolved: “That the 2001 Operating Budget for the Gasworks be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed the highlights of the 2001 Operating Budget for the Waterworks noting a 0% change in the water rate is being submitted; however, the rate will have to be reviewed in future years. Mayor Zehr questioned the transfer of capital in 2003/2004 and was advised that this transfer relates to capital replacement projects for watermains which now forms part of the capital budget. Ms. Houston then reviewed highlights of the 2001 Operating Budget for the Sewer . Surcharge On motion by Mayor C. Zehr – it was resolved: “That the 2001 Operating Budget for Waterworks and Sewer Surcharge be approved as submitted by the Administrative Review Committee.” Ms. Houston then reviewed highlights for the and the 5 year Tax Stabilization Reserve Fund projection assuming a 4.29% tax rate increase for 2001 with a 1.5% tax rate increase for each of the years 2002-2005, inclusive. Ms. G. Luciantonio then, with the aid of an interactive computer program, and at the Committee’s request, demonstrated the effects on the Tax Stabilization Reserve Fund of a 2% increase in the tax rate for each of the 5 years in the projection, then a 2.5% increase in 2001 and 2% increase in each subsequent year. The Committee then discussed a 0.5% reduction in Operating Budgets for all Departments, save for those expenses which are fixed such as salaries, gas and hydro. Ms. Luciantonio pointed out that with the increase in the Council Budget of $101,000. and the increase in Minor Sports Grants of $4,4000., as approved during this meeting, the proposed increase in the tax rate for 2001 is 4.45%. Councillor J. Ziegler directed staff to prepare a report outlining the effects of a 0.5% and 0.75% decrease in all department budgets, and the impact on the balance and earnings in the Tax Stabilization Reserve Fund given 1.75% or 2% tax increase scenerios for 2001. Mr. J. Gazzola stated that the proposed reductions in operating budgets will likely mean overexpenditures, if departments are to continue to provide services at current levels. He noted that the Administrative Review Committee has completed a line by line analysis of each department’s operating budget and staff are aware of the need to keep costs down and FINANCE & ADMINISTRATION COMMITTEE MINUTES JANUARY 12, 2001- 19-CITY OF KITCHENER 1. 2001 OPERATING BUDGET (CONT’D) increase efficiency. The Committee directed that staff provide the requested financial information on or before Budget Day. 2. ADJOURNMENT On motion, the meeting adjourned at 2:25 p.m. Dianne H. Gilchrist Committee Administrator