Loading...
HomeMy WebLinkAboutFin & Corp Svcs - 2007-02-26 SFINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 CITY OF KITCHENER The Finance and Corporate Services Committee met in special session this date commencing at 10:05 a.m. Present: Councillor B. Vrbanovic -Chair Mayor C. Zehr and Councillors J. Smola, G. Lorentz, J. Gazzola, K. Galloway and C. Weylie. Staff: C. Ladd, Chief Administrative Officer P. Houston, General Manager, Financial Services & City Treasurer T. Speck, General Manager, Corporate Services R. Browning, General Manager, Development & Technical Services A. Pappert, General Manager, Community Services R. Gosse, Director of Legislated Services & City Clerk D. Chapman, Director of Financial Planning & Reporting J. Witmer, Director of Building J. Willmer, Director of Planning R. Regier, Executive Director of Economic Development K. Baulk, Director of Enterprise K. Currier, Director of Operations D. Mansell, Director of Engineering L. Proulx, Director of Facilities Management R. Upfold, Director of Accounting M. Hildebrand, Director of Community Programs J. McBride, Director of Transportation Planning D. Quinn, Director of Utilities S. Adams, Director of Community & Corporate Planning R. Willms, Supervisor of Administration S. Wright, Manager, Downtown Community Development J. Billett, Committee Administrator 1. FIN-07-022 - 2007 OPERATING BUDGET The Committee was in receipt of Financial Services Department report FIN-07-022, dated February 12, 2007 concerning the City's 2007 Operating Budget, together with a Consolidated Budget Summary by Department /Object and budget Issue Papers for specific items. Ms. P. Houston provided an overview of the approach to budget preparation including strategic directions, key strategies and initiatives to increase efficiency and reduce costs. A comparison of the Household vs. City Consumer Price Index (CPI) was reviewed, showing an increase of 1.9% and 3.3% respectively. A comparison of municipal costs for an average household between Kitchener and the Cities of Waterloo and Cambridge was provided, showing that Kitchener remained lower in total costs in 2006 than the other two cities. It was noted that the Ministry of Municipal Affairs has established surplus benchmarks as a measure of budget precision with a less than 10% deviation considered acceptable. Councillor B. Vrbanovic inquired if the City should be budgeting for supplementary taxes. Ms. Houston advised that staff are recommending budgeting $1.5M in net supplementary taxes (Issue Paper #23), off-set by a reduction to the budgeted contribution to Operating from the Tax Stabilization Reserve Fund (TSRF) in accordance with the City's program to reduce reliance on the TSRF over time. Mayor C. Zehr inquired as to the potential for any deviation from the $1.5 M in terms of projecting a positive or negative impact. Ms. Houston stated that either may occur with the City relying on the TSRF in times of a deficit or ending in a surplus position. Councillor J. Gazzola suggested that the amount of supplementary taxes is dependent on the efficiency of the Municipal Property Assessment Corporation (MPAC) in keeping the assessment rolls up to date with new assessment. Ms. Houston noted that there will always be supplementary taxes as a result of new construction completed mid-year. She added that in the past MPAC had a substantial backlog causing delays of up to 3 years but has substantially reduced the delays to within a maximum of 1 year to add residential properties to the roll. Mayor C. Zehr asked that staff keep in mind any potential to modify projected supplementary taxes in light of efficiencies being achieved by MPAC. FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 51 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Ms. Houston then reviewed the proposed 2007 tax levy of 5.64% exclusive of any proposed additions or reductions, noting that the value of 1 % in the Operating budget is equal to $799,247. It was also noted that $1.8M of the City's projected surplus has already been allocated to the base Operating budget to maintain an appropriate base level. Options to reduce the tax levy were then provided, including: maintaining the 1.61 % 2006 one time tax credit to be funded from the TSRF; reducing investment income by 0.50%; and reducing add items by 0.25%; for an adjusted increase in the tax levy of 3.28%. Councillor J. Gazzola asked the dollar equivalent of a further 1.28% reduction to bring the tax levy at or below the rate of inflation and was advised that it would equate to approximately $1.03M. In response to Councillor B. Vrbanovic, Ms. Houston advised that if the options for reduction are accepted, the resulting 3.28% projected tax levy would comprise 1.22% for EDIF and 2.06% for inflationary increases to the operating budget; the latter being at net below the CPI. Councillor Gazzola suggested that the amount for EDIF should not be separate but rather included in the overall tax levy. Councillor Vrbanovic pointed out that, as established, it was understood that funding for EDIF would be over and above and in its first year has produced very positive results. He added that staff are no longer recommending that the one time tax credit in 2006 be recouped in response to citizen protests, which has an impact to the 2007 base budget. The Committee then reviewed the impact of legislated changes, projected at $1.2M in 2007. Councillor J. Gazzola referred to the loss of interest due to late tax billings and how this is a result of legislated changes. Ms. Houston explained that as a result of the introduction of a new Provincial tax system and capping program, more detailed calculations must now be made to phase-in tax increases for certain classes of property (ie. commercial /industrial / multi-residential). Accordingly, billing due dates for these properties have had to be adjusted to later in the year resulting in less interest being accumulated. She added that the only likelihood of achieving any more efficiencies in this regard would be for municipal Councils to lobby the Province to end the program. The Committee then reviewed the 10 Year Tax Rate Impact Projection for the years 2008 to 2017, ranging from 6.45% in 2008 to 1.45% in 2017. It was noted that new facilities in 2008 are the primary reason for a higher level projection, the largest of which is Fire Station No.7 at $2.4 M. It was also noted that staff will be guiding Council through a comprehensive budget exercise beginning in June 2007 to develop strategies and target impacts relative to the 2008 budget. BOARDS Mr. D. Chapman presented the proposed Operating budgets for the Centre in the Square (CITS) and Kitchener Public Library (KPL), at 2.5% and 4.4% increases respectively. Mr. Chapman advised that staff is satisfied that the proposed increase for the CITS is a true base increase with no expansion of services. In regard to the proposed increase for KPL, he noted that the amount includes re-allocation of the Book Reserve from Capital to their Operating budget and excluding this amount, the increase equates to 3.1 %. Mr. J. Grant, General Manager, CITS, advised that the majority of the proposed increase is to pay for increased water and hydro expenditures, with the remainder to be used for service improvements. Councillor J. Gazzola advised that he would not support more than a 2% increase for both organizations as it was his opinion that they must do all they can to help reduce the impact on the tax levy. On motion by Councillor G. Lorentz - it was resolved: "That the 2007 Operating Budget for the Centre in the Square be approved at $1,280,000. in 2007, representing a 2.5% increase over 2006." FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 52 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) The following motion was Carried, on a recorded vote, with Mayor C. Zehr and Councillors G. Lorentz, J. Smola, B. Vrbanovic, K. Galloway and C. Weylie voting in favour; and Councillor J. Gazzola voting in opposition. On motion by Mayor C. Zehr - it was resolved: "That the 2007 Operating Budget for the Kitchener Public Library be approved at $8,059,000. in 2007, representing a 4.4% increase over 2006." ENTERPRISES Golf Courses The Operating budgets for the Doon and Rockway Golf Courses were reviewed. In regard to Doon Golf Course, Councillor J. Gazzola requested an explanation of the debt charges of $1.9M. Mr. D. Chapman advised that the total value of debt charges relates to expansion of the Doon Golf Course. The debt charges were formally charged to Capital but it is staffs opinion that it is more appropriate that they now be charged out of the Operating budget. Ms. Houston added that originally it was intended that the expansion be funded from revenues derived from use of the newly expanded facility; however, the debt charges have accumulated as a result of significant delays in the expansion project and staff are of the opinion that it is time to deal with the matter notwithstanding the previous funding arrangement. Mr. K. Baulk noted that a report will come forward in April regarding future expansion plans, outlining a funding strategy. At the request of Mayor C. Zehr, Mr. Baulk agreed to review the Miscellaneous Revenue projections for both Golf Courses, in that, while the same amount is showing, one is a credit and the other a debit. Building Mr. D. Chapman advised that projected revenues are based on 2007 fee increases approved by Council in December 2006. He added that the projected transfers to the Building Reserve Fund are intended to stabilize the Enterprise in periods of economic down-turn. A target of $5.5M over a period of 5 to 7 years has been set to bring the Reserve Fund up to a level of 50%. Mayor C. Zehr questioned if it was necessary to raise the level of the Reserve Fund to that degree. Mr. J. Witmer advised that the level is based on the advice of the City's consultant, with the intention that the Reserve Fund will minimize significant spikes in future increases during times of economic down-turn. Gas Works Utility Mr. D. Chapman noted that a report will be coming forward in late March or early April as to the final 2006 actuals and gross profits have been impacted by an unseasonably warm winter in 2006. Mr. D. Quinn provided an explanation of how the transportation benefit is achieved, noting that the City's ability to benefit over time is the result of long term study of the market and the challenge of estimating is in using the forecast to ensure a positive outcome. Mr. D. Chapman responded to questions, advising that the Gas Capital Reserve Fund provides flexibility to off-set unforeseen expenditures impacting the Utility. Mr. Quinn added that reductions in margins are due in part to a conservative approach to forecasting but are also the result of the impact of regulatory changes that have increased expenditures. Mayor C. Zehr noted that the transfer from the Reserve Fund is greater in 2008 than other years and Mr. Chapman advised that the end balance of the Reserve Fund is to be at 50% over the previous year in accordance with Council policy. He noted that the fund has been impacted by the gross margin being higher than funding and also by the costs associated with the Joseph / Gaukel Street Remediation Project. Mayor Zehr suggested that the policy as written may create problems in less profitable years and should be reviewed. Mr. Chapman noted that FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 53 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) while difficulties can occur in a given year, such instances balance out over time and as long as a balance exists in the Reserve Fund there is flexibility to deal with contingencies. Mr. Quinn also noted that staff have had discussions concerning the policy and agreed that it would be timely for a review. Councillor J. Gazzola raised concerns that the projected gross profits for gas delivery are too conservative. Mr. D. Quinn advised that he anticipated some impact to the final 2006 figures due to a warmer winter in 2006 and while margins may be higher than estimated over time this should not be relied on. He added that staff can undertake a review in 2008 and make recommendations for any adjustments and projections deemed prudent at that time. Councillor Gazzola then referred to gross profits related to Other programs raising similar concerns in regard to the proposed percentage increases. Mr. Quinn advised that due to new technology resulting in changes to industry standards, the gas utility is faced with replacing a number of ventilation systems for water heater rental units across the City; the costs of which will have an impact on profit margins. At the request of Councillor J. Gazzola, Mr. Quinn agreed to report to a future Finance and Corporate Services Committee meeting, outlining details of the regulatory changes and their impact on profitability of the water heater rental program and overall budget. Water Utility /Sanitarv Utility /Water and Sanitarv Sewer Rates Mr. D. Chapman advised that the Utility budgets have favourable variances in 2006, with neither a surplus nor a deficit. He noted that approval of the 2007 water and sewer rates will be considered by Council at its meeting to be held later this date. Concerns were raised with regard to setting the City's water and sewer rates prior to confirmation of Regional rates. Staff advised that Regional rates would not be any higher than the projected 9.9% for water and 19.9% for sewer but could be lower. In approving the City's rates this date no loss of revenue will be experienced and should Regional rates be set lower than projections, any resulting surplus could be used toward lowering the City's annual deficit for sanitary and water services. Following further discussion, it was agreed that direction would be given at the Council meeting this date to defer approval of the City's water and sewer rates pending confirmation of Regional rates. Concerns were also raised regarding costs associated with inflow of stormwater into the sewer system. Mr. D. Mansell advised that a repair program is in place to re-line sewer pipes to prevent inflow of stormwater; however, he suggested that more sustainable dollars would be needed in order to increase the impact of the repair program. Councillor B. Vrbanovic questioned if a business model has been investigated in similar manner to the City's Energy Management System. Mr. Mansell advised that such an analysis has not been undertaken but staff have attempted to lobby funding from senior levels of government; however, without success. He added that Kitchener inflow levels fall below the accepted standard of 30% set by The American Water Works Association. Mayor C. Zehr inquired if reductions in inflow would translate to savings in wholesale costs, or to savings in capital costs as they would relate to expansion of treatment plants. Mr. Mansell suggested that there may be savings in wholesale costs; however, savings in capital costs are unlikely as the need for treatment plants is based on population. The Committee then recessed at 12:35 p.m. and reconvened at 1:15 p.m., with all members present. TAX SUPPORTED OPERATING BUDGET Mr. D. Chapman reviewed the proposed 2007 tax levy of 5.64%, including 1.22% for the Economic Development Investment Fund (EDIF) and exclusive of proposed additions or reductions. Mr. Chapman advised that response to a survey undertaken as part of the public consultation process on the budget was disappointing with only 59 responses received. It was noted, however, that as a result of the overall public consultation process it appeared evident FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 54 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) that there is public support for new investments. Add Proposals Mr. Chapman advised that Issue Papers have been prepared for add-on proposals, totalling $1.2M (1.54% of the levy) and staff is recommending that the Committee reduce the amount of add-ons by $200,000. (0.25%). Councillor B. Vrbanovic asked that the Committee hear comments from staff on all Issue Papers prior to making any final decisions. Issue Pager #9 tEconomics Co-og Student Program) Ms. C. Ladd advised that the Economic Development Division is requesting funding to hire a co-op student in each of the three terms of a school year at a cost of $36,040. The student will assist the City in better understanding its role in facilitating growth of the new urban economy and enhancement of the City's capacity for economic analysis. Issue Paper #20 tDiversity) Ms. Ladd advised that two components are proposed for 2007, comprising corporate and community initiatives. Corporately, $10,000. is requested to commence a Diversity in the Work Place Awareness Program to introduce City staff to the ongoing work of the Diversity Committee; and to develop aself-identification survey, to be conducted bi-annually, to determine how visible minorities are represented within the City's current staff complement. $90,000. is requested to hire one full time employee (FTE) to move forward with a Community Based Diversity Program. The FTE will assist in the development of corporate diversity strategy, policies and approaches to service provision that ensures all people in the community have equitable opportunity for civic participation. Several members of the Committee raised concerns regarding the need for a full time position. Ms. S. Adams stated that resources are needed to research best practices to determine what is appropriate for Kitchener in terms of meeting the needs of a diverse community. Ms. Ladd added that Kitchener has one of the highest intakes of new Canadians but it has come to staffs attention that they generally do not find the City welcoming. She suggested that it will take time to work with the community to understand what can be done to better integrate new Canadians. Councillors K. Galloway, B. Vrbanovic and J. Gazzola spoke in opposition to funding an FTE, commenting that it is the responsibility of everyone in the Corporation to understand and address issues of diversity; and suggesting that a more comprehensive look at internal resources be undertaken. Councillor C. Weylie expressed the opinion that the City needs to do more to address the needs of new Canadians, including enhancing minority representation on its Advisory Committees. In response to Councillor J. Gazzola, Ms. Houston advised that staff is currently gathering information on the make-up of the City's core complement for the Committee's information on Budget Day. Issue Paper #18 tContract With The Humane Society) Ms. P. Houston advised that staff is currently in negotiations with the Humane Society to renew two contracts fora 4 year period dealing with Animal Services /Dog Licensing and the Spay Neuter Program. Several areas have been identified where increases greater than inflation are required due to growth and associated costs to administer the Spay Neuter Program, as well as undertaking investigations /designations under the City's Dangerous Dog By-Law. A net budget increase in 2007 of $414,708. is requested to accommodate identified issues; however, negotiations are not final at this time and may result in higher or lower costs than proposed. FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 55 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Ms. R. Upfold responded to questions, advising that fees imposed are based on a threshold of user acceptance and are not proposed to change. She added that the proposed 5% increase consists of 2% built-in inflation, 1 % recognition for growth and a one time 2% increase in 2007 relative to costs associated with the City's Dangerous Dog By-Law. Ms. Upfold further noted that negotiations have concluded and the end result is very close to staffs' projections; the details of which will be provided to Council prior to Budget Day. Councillor G. Lorentz raised concerns regarding the accuracy of investigations /designations for dangerous dogs undertaken by the Humane Society, suggesting that a mechanism is needed to measure provision of service. Issue Pager #10 tBreithaupt Centre Staffing Re-organization) Ms. A. Pappert advised that $25,697. annually is requested to convert apart-time position to full time to address growth in the Adult 50 Plus Division. Mr. M. Hildebrand advised that the additional funding will bring the Breithaupt Centre to the same staffing level as all other Community Centres with senior programming. Issue Pager #11 tBridgeport Community Centre Operational Increase) Ms. A. Pappert advised that this Community Centre is the least funded of all and operating grants have not kept pace with increased costs of operating this facility. She advised that staff is preparing a business case for consideration in 2007 and the proposed increase of $20,000. will help carry the Centre through until a decision on the business case is made. Mr. M. Hildebrand advised that the additional funding will assist with rising energy costs and increased programming. The Committee requested that staff provide more detailed information for Budget Day as to what the additional funding will be used for. Issue Paper #12 tChandler-Mowat Communitv Centre Program Expansion and Service Growth Ms. A. Pappert advised that there has been a shift in how this Centre is operated, going from 6 portables to a permanent facility. She noted that a previous projection of $100,000. in 2007 for operation of the facility pre-dates the business case process and accordingly, a thorough analysis of the existing staffing model and it's relevance for running a permanent facility was not completed. It is now proposed to move from the staffing model whereby the facility is operated by the House of Friendship staff to one where the City will oversee operations of the facility and provide support to the Neighbourhood Association. Mr. Hildebrand advised that the Centre has grown considerably as a group, planning and implementing it's own recreation programs for which they require support, similar to other Neighbourhood Associations. It was noted that the majority of programs previously offered were related to social services as opposed to recreational. He added that the House of Friendship intends to continue to supervise and maintain existing social programming as partners in the facility. The Committee requested that a detailed budget, showing line items totalling the proposed $181,771. be provided for Budget Day. Issue Paper #13 tVictoria Hills Communitv Centre Growth Adjustment) Ms. A. Pappert advised that the proposed increase of $79,353. is to provide continued administrative support, approved mid-2006, for the full year in 2007 to meet the needs of operating the expanded facility. Mr. M. Hildebrand agreed to review the business case for expansion of the facility to determine if the FTE positions are new or a continuation of existing. FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 56 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Mayor C. Zehr requested that staff provide a comparison of all Community Centre operations, including: funding; programming; facilities; FTE's; square footage and population base served. Councillor G. Lorentz also requested that staff indicate the staffing model for each Centre. Ms. Pappert advised that staff are in the process of preparing a report on Community Centres for consideration at a future Community Services Committee meeting and will undertake to include the requested information in this report; however, she indicated that it may not be possible to include base population figures. Issue Pager #15 thew FTE Administration Analyst) Ms. A. Pappert advised that this new position would begin in June 2007 to implement and monitor data collection, analysis, evaluation and mapping resource responsibilities, as identified in the Leisure Facilities Master Plan. Ms. Pappert advised that if not approved, staff will continue to provide the best information they can but are of the opinion that this position is needed in view of 15 business cases to come forward. Issue Pager #17 tOgerations to Service Growth) Ms. A. Pappert advised that $327,442. is being requested to fund service growth in the Operations Division to enable staff to maintain current levels of service across the City while reducing the number of unfunded staff. Mr. K. Currier advised that in 2004 a process was undertaken to reduce reliance on revenues accrued for doing work for other Departments and to bring Operations funded staff to an appropriate complement to maintain current service levels. He noted that the increased funding will allow Operations to be in a position to reduce the number of unfunded staff to 10, which is a sustainable level and will allow an end to the catch-up program. In response to questions, Mr. Currier advised that the result of bringing funding levels to full complement over two years will delay an end to the catch-up program for 1 more year and staff would continue to rely on work from other Departments to fund the shortfall. The Committee requested additional information for Budget Day pertaining to the history of the funding shortfalls. Issue Pager #19 tPart-Time Administrative Suggort -Arts and Culture) Ms. A. Pappert advised that the increased funding of $27,675. is requested to provide apart- time clerical support staff for the Arts and Culture section's programs. An analysis of the section's workload was completed in January 2006 showing an accumulated overtime by the 2 FTE's equal to an additional, annual FTE at 35 hrs/w. Since May 2006, clerical support has been provided to this section on a temporary contract basis. The proposed part-time position will allow the 2 FTE's to operate more efficiently at their grade levels. The funding for this position will also be reviewed in context with a larger Community Services review of its administration. Issue Paper #6 tTransportation Demand Management [TDM]) Mr. R. Browning advised that $80,000. is being requested in 2007 to hire a full time co- ordinator to develop a TDM strategy for the City that will promote educated choices in travel mode options, with the ultimate goal to reduce the number of vehicle trips. Mr. Browning noted that the benefits of a TDM program are many and are consistent with Council's environmental initiatives. FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 57 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Mr. J. McBride responded to questions, advising that this is a collaborative approach with the Region of Waterloo, that will initially focus on the City's downtown core to reduce parking demands and congestion. This position will work closely with staff on City related planning issues that have an impact on transportation demands. He noted that this initiative requires a paradigm shift in attitudes and in this regard, measuring its success is likely to be a long term process; adding that municipalities are in a stronger position of influence than senior levels of government given they dictate municipal levels of service, including parking structures and rates. The Committee requested that staff consider approaching the Region of Waterloo to determine the feasibility of pooling this resource or making it a contract position. Issue Paper #7 tAdditional Land Use Planner) Mr. R. Browning advised that an additional $83,222. annually is being requested to allow hiring of a full time Land Use Planner. He noted that staffing levels have declined at the same time the community has continued to grow, and the level of complexity of planning and development issues has also increased. Mr. Browning added that the staff shortage was identified in the Department's 2006 strategic plan and has raised concerns within the development industry in regard to the responsiveness of staff. Mr. J. Willmer responded to questions, advising that the Department has primarily returned to full complement following five departures within a short period of time; however, he noted that even prior to those departures it was acknowledged that the Department was understaffed. He stated that staffing levels are insufficient to meet current service levels, resulting in a backlog of work and placing staff in a position of being reactive rather than proactive. He further noted that he has documented justification for an additional 8 FTE's but at this time the Department is only requesting two additional staff, being this position and an additional Heritage Planner. An overview of the backlog of City projects was also provided, as well as the impact this has on citizens, the community at large, developers and City staff. Issue Pager #16 tAdditional Planning Division Staff -Heritage Planner) Mr. R. Browning advised that an additional $63,405. annually is being requested to allow hiring of a second Heritage Planner or Technician. He pointed out that the City has relied on the services of a single Heritage Planner since 1992, during which time the community and its interest in heritage conservation has grown significantly. This position will assist in meeting Council's direction to inventory heritage resources in rural areas, administer applications in accordance with legislative requirements, and review of approximately 800 properties listed on the Heritage Inventory. Issue Paper #8 tConsultant Support -Development Process and Fee Review) Mr. R. Browning advised that $10,000. is requested in 2007 to retain a consultant to assess and measure Planning Division resources invested in development review, with an expected outcome being that any additional revenues generated by an increase in fees be used to hire additional staff to improve the level of service. Issue Pager #4 tARC Flash Safety Requirements) Mr. T. Speck advised that within Canada a committee has been established to develop equivalent legislation to that of the USA to deal with ARC Flash (ie. dangerous condition associated with release of energy caused by an electric arc). The new legislation is expected to be released in 2008 and in anticipation, staff are recommending $15,000. be budgeted in 2007 to provide staff with ARC flash training and personal protective equipment. Issue Pager #5 tElection Costs Over Four Years vs. Three Years) Mr. T. Speck advised that with the advent of longer municipal terms of office, municipal election costs can now be spread over a period of four years rather than three, resulting in a net savings of $31,189. FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 5$ - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Issue Pager #14 tCommunity Centre Ogeratina Increases) Mr. T. Speck advised that an additional $116,650. is requested to cover costs associated with service growth related to expansion of the Victoria Hills and Kingsdale Community Centres, and new permanent structure for the Chandler-Mowat Community Centre; and programming expansion at the Mill Courtland and Rockway Senior Community Centres. Mr. L. Proulx responded to questions, advising that each of the three community centres (Victoria Hills, Kingsdale and Chandler-Mowat) now has apart-time building attendant on a 24 hour per week basis and all building costs for community centres are budgeted through Facilities Management. Mayor C. Zehr requested that the report on community centres coming forward include FTE and part-time staffing equivalents. Issue Pager #2 tComgliance and Training Co-ordinator) Ms. A. Pappert advised that $100,000. is requested ($85,000. for Operations and $15,000. for Sanitary Utility) to allow hiring of a Compliance and Training Co-ordinator to create, train and maintain Standard Operating Procedures (SOP's). Mr. K. Currier advised that Ministry of Environment regulations require documented SOP's to be submitted when an accident incident occurs, which Operations currently do not have. The proposed position will enable this requirement to be met and the resulting documented SOP's will provide reference for staff to ensure they are properly performing their duties as well as be used in training of new and existing staff. Issue Pager #3 tHours of Work Legislation) Ms. A. Pappert advised that changes in provincial legislation this year relative to hours of work will impact Operations and particularly, in regard to the on-call component within the sanitary sewer section and the winter control component within the road maintenance section. An additional $130,800. ($85,000. to Operations and $45,800. to Sanitary Utility budgets) is being requested to maintain compliance with the new hours of work legislation. Mr. K. Currier advised that calls for sewer maintenance are received on a 24/7 basis now and staff are working beyond their normal shifts. Additional part-time staff is needed in order to maintain service levels within the guidelines of the new legislation. GRANT ALLOCATIONS The Committee then reviewed economic development, capital and annual operating grant appeals for 2007 (Issue Paper #21). Mr. D. Chapman noted that $457,000. is under appeal representing a 0.57% increase to the tax levy. ECONOMIC DEVELOPMENT GRANTS Canada's Technology Triangle tCTT) A motion by Councillor J. Gazzola was brought forward for consideration to approve a grant of $137,000. for CTT. In response to Mayor C. Zehr, Ms. Ladd advised that CTT has not had an increase for the past four years and originally requested a 19% increase in 2007. A phased-in approach over three years is being recommended and has been supported by the other participating municipalities. Mayor Zehr agreed with the approach being taken and accordingly, advised that he would not support the motion. Councillor J. Gazzola stated that he would like to see all grants limited to a 2% increase, noting that this is only a recommendation for 2007 and that the grant could be re-assessed in each of the subsequent two years. FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 59 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Councillor J. Gazzola's motion was then voted on and Lost. On motion by Mayor C. Zehr - it was resolved: "That a 2007 grant in the amount of $140,000. to Canada's Technology Triangle (CTT) be approved." Waterloo Region Small Business Centre On motion by Councillor C. Weylie - it was resolved: "That a 2007 grant in the amount of $62,500. to the Waterloo Region Small Business Centre be approved." Communitech Technology Association Mr. R. Regier advised that in accordance with the Committee's direction to work with Communitech to provide non-monetary assistance, staff have met with the group on two occasions to discuss building partnerships around the City's Economic Development Strategy. He advised that it was too early to provide details as to what type of partnership that may be formed, although interest has been expressed in bio-tech pharma clusters. Mayor C. Zehr advised that he could not support the group's funding request and asked how the other area municipalities are responding. Ms. C. Ladd advised that both the City's of Cambridge and Waterloo did not support grant funding for this group and the Region of Waterloo will have its discussions later this week. On motion by Councillor J. Gazzola - it was resolved: "That a 2007 grant in the amount of $35,000. to the Communitech Technology Association be approved." ANNUAL OPERATING GRANT APPEALS Skills Canada Ontario A motion by Councillor J. Gazzola was brought forward for consideration to approve a $650. in-kind grant to Skills Canada Ontario. Councillor J. Gazzola subsequently withdrew his motion on being advised that the group is not holding its event in a Kitchener facility this year and accordingly, is not asking for an in-kind grant. A motion by Mayor C. Zehr was brought forward for consideration to approve a $5,000. grant to Skills Canada Ontario. Councillors G. Lorentz and J. Gazzola spoke in opposition to the motion as education is not a core municipal responsibility and the group's event is not being held in Kitchener. Mayor C. Zehr and Councillor B. Vrbanovic spoke in favour of the motion, commenting on the importance of supporting the advancement of skilled trade within the regions labour force. On motion by Mayor C. Zehr - it was resolved: "That a 2007 grant in the amount of $5,000. to Skills Canada Ontario be approved." FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 60 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Business and Education Partnership A motion by Councillor J. Gazzola to refuse the 2007 grant request from the Business and Education Partnership was voted on and Lost. On motion by Mayor C. Zehr - it was resolved: "That a 2007 grant in the amount of $5,000. to the Business and Education Partnership be approved." Latitudes Storytelling Festival On motion by Councillor J. Gazzola - it was resolved: "That the request from Latitudes Storytelling Festival fora 2007 grant in the amount of $5,000. be refused." Leadership Waterloo Region On motion by Councillor J. Smola - it was resolved: "That a 2007 grant in the amount $7,500. to the Leadership Waterloo Region be approved; and further, That the Leadership Waterloo Region be included in the list of annual operating grant recipients." Contemporary Art Forum Kitchener and Area tCAFKA) A motion by Councillor G. Lorentz was brought forward for consideration to approve a 2007 grant in the amount of $19,380. ($9,000. cash and $10,380. in-kind) to CAFKA. Mayor C. Zehr commented that in 2006 the Committee was fully apprised of the group's intention to run its' festivals bi-annually and that the next would be in 2007 for which they would be seeking an increase in funding. He suggested that as a matter of good faith a larger amount should be approved. Councillor J. Gazzola disagreed, suggesting that in 2006 it was unclear as to how the group would operate in future. Councillor G. Lorentz's motion was then voted on and Lost. On motion by Mayor C. Zehr - it was resolved: "That a 2007 grant in the amount of $30,000. (the breakdown of cash and in-kind to be determined by staff) to Contemporary Art Forum Kitchener and Area (CAFKA) be approved." Councillor B. Vrbanovic left the meeting at this time and Councillor J. Smola assumed the Chair. K-W Arts Awards On motion by Councillor J. Gazzola - it was resolved: "That a 2007 grant in the amount of $10,000. to the K-W Arts Awards be approved, subject to the amount budgeted in 2007 being transferred to the annual grants budget." FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 61 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) K-W Art Gallerv A motion by Councillor J. Gazzola was brought forward for consideration to approve a 2007 grant in the amount of $170,940 ($90,036 cash and $80,904 in-kind) to the K-W Art Gallery. Mayor C. Zehr spoke in opposition to the motion, raising concerns that the proposed amount would result in an inequity of funding between the K-W Art Gallery and the Homer Watson House & Gallery. He added that both are important but different in their scope of operation and the Art Gallery is in need of the level of support they are requesting to maintain their programming. Councillor J. Gazzola's motion was then voted on and Lost. On motion by Mayor C. Zehr - it was resolved: "That a 2007 grant in the amount of $224,904 ($144,000 cash and $80,904 in-kind) to the K-W Art Gallery be approved." Councillor B. Vrbanovic re-entered the meeting at this time and assumed the Chair. House of Friendship - Kingsdale Community Program On motion by Councillor J. Gazzola - it was resolved: "That a 2007 grant in the amount of $61,800 to the House of Friendship -Kingsdale Community Program be approved." Homer Watson House and Gallerv A motion by Councillor C. Weylie was brought forward for consideration to approve a 2007 grant in the amount of $167,484 to the Homer Watson House and Gallery. Councillor's J. Gazzola and G. Lorentz spoke in opposition to the motion, as it was their understanding that the City had supported a 5 year phase-in plan to address wage equity. Ms. R. Willms noted that no formal motion was adopted by Council in regard to the phase-in plan. Mayor C. Zehr expressed concerns with the Gallery's proposed 20% increase as it is solely related to wage increases with no proposed change in complement; adding that the City does provide other grant funding to the Gallery for maintenance of the facility. He stated that while he could not support the full 20% increase he would support half that amount. Councillor C. Weylie's motion was then voted on and Lost. On motion by Mayor C. Zehr - it was resolved: "That a 2007 grant in the amount of $180,600 to the Homer Watson House and Gallery be approved." Kitchener Blues Festival On motion by Councillor G. Lorentz - it was resolved: "That a 2007 grant in the amount of $35,000 ($20,000 cash and $15,000 in-kind) to the Kitchener Blues Festival be approved." FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 62 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Kitchener-Waterloo Chess Club A motion by Mayor C. Zehr was brought forward for consideration to approve a 2007 grant in the amount of $8,500 ($5,100 cash and $3,400 in-kind) to the K-W Chess Club. Councillor J. Gazzola commented that the Chess Festival, held for the first time last year, was very successful and he would like to see a higher level of support for this group. Councillor K. Galloway raised concerns with providing higher levels of grant funding with no onus on the organizations to undertake their own fundraising. Mayor C. Zehr's motion was then voted on and Lost. On motion by Councillor J. Gazzola - it was resolved: "That a 2007 grant in the amount of $14,400 ($11,000 cash and $3,400 in-kind) to the Kitchener-Waterloo Chess Club be approved." Tamil Cultural Association of Waterloo Region On motion by Mayor C. Zehr - it was resolved: "That a 2007 grant in the amount of $1,000 to the Tamil Cultural Association of Waterloo Region be approved." K-W Performing Arts Association /Theatre & Comgany A motion by Councillor G. Lorentz was brought forward for consideration to approve a 2007 grant in the amount of $6,630 ($2,550 cash and $4,080 in-kind) to the K-W Performing Arts Association /Theatre & Company. Mayor C. Zehr commented on the changes the organization has made to improve their operations, stating that he would like to see a higher level of support in 2007. Councillor G. Lorentz's motion was then voted on and Lost. On motion by Mayor C. Zehr - it was resolved: "That a one time 2007 grant in the amount of $54,200 ($50,000 cash and $4,200 in- kind) to the K-W Performing Arts Association /Theatre & Company be approved." K-W Weavers & Spinners Guild On motion by Councillor J. Smola - it was resolved: "That a 2007 grant in the amount of $1,200 to the K-W Weavers & Spinners Guild be approved." The MT tMulticultural Theatre) Space On motion by Councillor J. Gazzola - it was resolved: "That a 2007 grant in the amount of $7,000 to The MT (Multicultural Theatre) Space be approved." FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 63 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) CAPITAL GRANTS KidsAbility Foundation A motion by Councillor K. Galloway was brought forward for consideration to approve a 2007 grant in the amount of $10,000 to the KidsAbility Foundation. At the suggestion of Councillor J. Gazzola, Councillor Galloway agreed to amend the motion to provide a total grant in the amount of $40,000. over a 2 year period, with $20,000 allocated in each of 2007 and 2008. On motion by Councillor K. Galloway - it was resolved: "That a grant in the amount of $40,000 ($20,000 in 2007 and $20,000 in 2008) to the KidsAbility Foundation be approved." The Working Centre On motion by Councillor J. Gazzola - it was resolved: "That a grant in the amount of $20,000 ($10,000 in 2007 and $10,000 in 2008) to The Working Centre be approved." Kitchener Alliance Community Homes tKACH) - 4 Churches Project Mr. Ken Motz, KACH, responded to questions advising that the funds requested relate to actual costs of a feasibility study for the redevelopment of the downtown Kitchener properties associated with the 4 Churches Project and will enable the group to complete the study. Mayor C. Zehr raised concerns with the potential for this project to move to a full scale for- profit development and the precedent that could be set within the development industry if the City is a contributor. He stated that he could only support the request on the basis that if the project became a fully for-profit development that the grant funding would be returned to the City. Mr. Motz stated that he fully understood the concerns and saw no reason why the group would not agree. On motion by Councillor J. Gazzola - it was resolved: "That a 2007 grant funded from capital in the amount of $35,000 to the Kitchener Alliance Community Homes (4 Churches Project) be approved, subject to an agreement being entered into, to the satisfaction of the City Solicitor, to provide that the said grant be refunded to the City in the event the 4 Churches Project becomes afor-profit development." Add Proposals The Committee then returned to the list of Add Proposals and the following decisions were made. Issue Pager # 2 tComgliance and Training Co-ordinator) On motion by Mayor C. Zehr - it was resolved: "That $100,000, of which $85,000 is to be allocated to Community Services Department - Operations and $15,000 to Development & Technical Services Department -Sanitary Utility budget, be approved for the hiring of a Compliance and Training Co-ordinator to create, train staff and maintain Standard Operating Procedures." FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 64 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Issue Pager #3 -Hours of Work Legislation On motion by Councillor K. Galloway - it was resolved: "That $130,800, of which $85,000 is to be allocated to Community Services Department - Operations and $45,800 to Development & Technical Services Department -Sanitary Utility budget, be approved to allow Operations to comply with the new Hours of Work legislation." Issue Paper #4 -ARC Flash Safety Requirements On motion by Councillor G. Lorentz - it was resolved: "That $15,000 be budgeted in 2007 to provide staff ARC Flash training and personal protective equipment." Issue Paper #6 -Transportation Demand Management Councillor J. Smola assumed the Chair to allow Councillor B. Vrbanovic to participate in discussion. A motion by Councillor B. Vrbanovic was brought forward for consideration to approve $80,000, to be funded from a source other than the Operating budget, to allow hiring of a Transportation Demand Management Co-ordinator on a full time basis, effective July 1, 2007. Councillor J. Gazzola advised that he would not support the motion as it was his opinion this matter is beyond the mandate of the City. Councillor G. Lorentz suggested that discussions should be undertaken with senior officials of the other area municipalities and the Region of Waterloo in regard to utilizing the services of the Region's TDM Co-ordinator on a project by project basis. Ms. C. Ladd agreed to approach her counterparts; however, noted that resulting implications may be problematic for the Cities of Cambridge and Waterloo who have already approved their 2007 budgets. Councillor B. Vrbanovic agreed to withdraw his motion but asked that the budgeted amount be removed from the Operating budget. Accordingly, this matter was deferred to the April 16, 2007 Budget Day meeting pending additional information from staff. Councillor B. Vrbanovic then assumed the Chair. Issue Paper #7 -Additional Land Use Planner On motion by Councillor C. Weylie - it was resolved: "That $83,222.48 be approved as an annual allocation to the Development and Technical Services Committee Operating budget to enable the Planning Division to add a Land Use Planner, preferably with urban design expertise." Issue Paper #8 -Consultant Support -Development Process & Fee Review A motion by Councillor C. Weylie was brought forward for consideration to provide that $10,000 be budgeted in 2007 for the Planning Division to retain a consultant to recommend appropriate development application fees based on measurement of staff resources spent on each application type. FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 65 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Councillor B. Vrbanovic inquired as to why this was being added to the base Operating budget if it was only a one time expenditure. Subsequently, it was agreed that this matter be removed from the Operating budget and deferred to the April 16, 2007 Budget Day, pending determination of an appropriate funding source. Issue Pager #9 -Increasing the City's Capacity for Economic Analysis On motion by Councillor K. Galloway - it was resolved: "That $36,040 be budgeted in 2007 to fund an Economics Co-op Student Program, as outlined in Issue Paper #9 attached to Financial Services Department report FIN-07- 022." Issue Papers #10 to #14 On motion by Councillor J. Smola - it was resolved: "That Issue Papers 10 to 14, inclusive, as attached to Financial Services Department report FIN-07-022, concerning various requests for additional funding related to Community Centres, be deferred to the April 16, 2007 Budget Day meeting, pending additional information from staff to address concerns raised at the February 26, 2007 special Finance & Corporate Services Committee meeting." Issue Pager #15 -New FTE Administration Analyst On motion by Mayor C. Zehr - it was resolved: "That funding in the amount of $34,122 be budgeted in 2007 to allow hiring of a full time Administration Analyst to carry out the `data collection, analysis, evaluation and mapping resources' duties, as identified in the Leisure Facilities Master Plan." Issue Pager #16 -Additional Planning Division Staff tHeritage Planner) On motion by Mayor C. Zehr - it was resolved: "That $63,405.52 be approved as an annual allocation to the Development and Technical Services Committee Operating budget to enable the Planning Division to add a second Heritage Planner or Technician." Issue Paper #17 -Operations to Service Growth At the request of Mayor C. Zehr, it was agreed to reduce the funding amount from $327,442. to $177,442., thereby delaying an end to the catch-up program of Operation's unfunded staff by one more year. On motion by Mayor C. Zehr - it was resolved: "That funding to service growth of $177,442 be approved in 2007 for the Operations operating budget to maintain current levels of service and provide for completion of the catch-up program for unfunded staff over 2007 and 2008." FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 66 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) Issue Pager #18 - Contract with the Humane Society On motion by Councillor G. Lorentz - it was resolved: "That Issue Paper #18, as attached to Financial Services Department report FIN-07- 022, dealing with renewal of contracts with the Humane Society be deferred to the April 16, 2007 Budget Day meeting, pending additional information regarding fees and the outcome of discussions with all interested parties concerning the accuracy of investigations /designations under the City's Dangerous Dog By-law." Issue Pager #19 -Part-Time Administrative Suggort tArts and Culture) On motion by Mayor C. Zehr - it was resolved: "That $27,675 be budgeted in 2007 to the Community Services Department operating budget to allow the Arts and Culture Section to add apart-time Administrative Support position." Issue Paper #20 -Diversity Program Councillor B. Vrbanovic noted that this was one of the items discussed previously for which the Committee had requested additional information. Accordingly, it was agreed that this matter would be deferred to the April 16, 2007 Budget Day meeting for further consideration pending additional information from staff. NET IMPACT TO TAX LEVY Ms. P. Houston advised that as a result of the decisions made this date the projected tax levy is now at 3.41 %, broken down to 1.2% for EDIF and 2.19% for operating. She added that all deferred items are still included in the targeted 3.41 % and dependent on decisions made on budget day may have further impact to the tax levy. Councillor J. Gazzola advised that he would like to see what staff could do to bring the tax levy down to 2%, inclusive of EDIF. Ms. Houston responded that staff provided their options for reduction this date and any further deferral or elimination of add proposals would be at the Committee's discretion. Mayor C. Zehr suggested that one method of reducing the budget may be by reducing the estimated cost of fuel. He requested that staff monitor the price per litre of gasoline to determine if any reduction can be made in the budgeted price per litre. Councillor B. Vrbanovic requested that staff provide additional information for budget day on the feasibility of reducing the budgeted amount for internal telephone billings. The Committee agreed that time would be allocated on upcoming agendas for all Finance & Corporate Services Committee meetings scheduled to be held between now and Budget Day, to allow an opportunity for Committee members to bring forward any suggestions for reduction in the projected tax levy that they would like staff to investigate. RESERVE FUNDS Mayor C. Zehr inquired as to the reason for a negative balance of $37,000 in the Asset Management Reserve Fund. Ms. P. Houston advised that the deficit relates to the City's commitment to purchase the Schoerg Barn. Mayor Zehr asked if the $1.08 M in the Business Park Reserve Fund was separate from EDIF and Ms. Houston concurred. Mayor Zehr suggested that there may be potential to use this funding for other purposes. He then requested an explanation of the Victoria Park Ice Reserve Fund and Ms. Houston advised that this fund was established by Council resolution to be used in weather permitting conditions to FINANCE & CORPORATE SERVICES COMMITTEE MINUTES FEBRUARY 26, 2007 - 67 - CITY OF KITCHENER 1. FIN-07-022 - 2007 OPERATING BUDGET tCONT'D) ice-over Victoria Park for use as a skating rink. She added that this fund could be eliminated if desired. In response to a question of Councillor J. Gazzola, Ms. Houston advised that $400,000 has been included in the base budget as additional investment income. 2. ADJOURNMENT On motion, the meeting adjourned at 6:05 p.m. Janet Billett, AMCT Committee Administrator