Loading...
HomeMy WebLinkAboutFin & Corp Svcs - 2009-10-26FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 CITY OF KITCHENER The Finance and Corporate Services Committee met this date commencing at 1:05 p.m. Present: Councillor J. Smola -Vice-Chair Mayor C. Zehr and Councillors G. Lorentz, J. Gazzola and K. Galloway. Staff: C. Ladd, Chief Administrative Officer D. Chapman, General Manager, Financial Services & City Treasurer T. Speck, General Manager, Corporate Services J. UVillmer, Interim General Manager, Development & Technical Services P. Houston, General Manager, Community Services S. Adams, Director, Community & Corporate Planning R. Regier, Executive Director, Economic Development H. Gross, Director, Project Administration & Economic Investment G. Murphy, Director of Engineering R. Gosse, Director, Legislated Services & City Clerk S. Turner, Director, By-law Enforcement C. Fletcher, Director, Facilities Management J. Evans, Director of Revenue vV. Malcolm, Director of Utilities M. Hildebrand, Director, Community Programs & Services T. Beckett, Fire Chief R. Lebrun, Manager, Financial Planning D. Campbell, Manager, Community Resource Centres R. Morgan, Capital Investment Advisor S. Saleh, Senior Financial Analyst J. Billett, Committee Administrator 1. CRPS-09-143 -EXEMPTION TO CHAPTER 450 (NOISE) OF THE MUNICIPAL CODE -BETHANY EVANGELICAL MISSIONARY CHURCH The Committee considered Corporate Services Department report CRPS-09-143, dated October 16, 2009 concerning a noise exemption request. On motion by Councillor G. Lorentz - itwas resolved: "That an exemption to Chapter 450 (Noise) of the City of Kitchener Municipal Code be granted to the Bethany Evangelical Missionary Church for their annual Christmas Pageant from December 3 to December 6, 2009, between the hours of 6:00 P.M. and 9:00 P.M., daily." 2. CRPS-09-144 - AMENDMENT TO COUNCIL POLICY I-05 (CODE OF CONDUCT FOR MEMBERS OF COUNCIL, LOCAL BOARDS AND ADVISORY COMMITTEES) - REMOVAL OF KITCHENER HOUSING INC. UNDER DEFINITION OF LOCAL BOARD The Committee considered Corporate Services Department report CRPS-09-144, dated October 19, 2009 concerning an amendment to Council Policy I-05 (Code of Conduct}. On motion by Councillor G. Lorentz - itwas resolved: "That Council Policy I-05 (Code of Conduct for Members of Council, Local Boards and Advisory Committees} be amended by removing Kitchener Housing Inc. under Part 1 Definitions `Local Board'." 3. FIN-09-149 -CIS (TAX I UTILITY BILLING SYSTEM) -CONSULTANT CONTRACT EXTENSION The Committee considered Financial Services Department report FIN-09-149, dated October 20, 2009 requesting permission to extend the contract for the CIS consultant to June 2010. FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -143 - CITY OF KITCHENER 3. FIN-09-149 -CIS (TAX I UTILITY BILLING SYSTEM) -CONSULTANT CONTRACT EXTENSION (CONT'DI On motion by Councillor G. Lorentz - itwas resolved: "That the contract for the CIS consultant (John Little} be extended by six months to the end of June, 2010; and further, That the cost of this extension be funded through the capital budget for CIS (tax /utility billing system}." 4. CAO-09-045 -DECLARATION OF SURPLUS, VACANT LAND AND SALE TO THE ABUTTING LAND OWNER AT 51 PINE STREET The Committee considered Chief Administrator's Office report CAO-09-045, dated October 13, 2009 concerning the sale of City-owned surplus lands. On motion by Councillor G. Lorentz - itwas resolved: "That the lands located on Pine Street, in the City of Kitchener, owned by the Corporation of the City of Kitchener, described as Part 3 of Registered Plan 58R-5120, be declared surplus to the City's needs and sold to the Estate of Peggy Yurkiw, the owner of the abutting property at 51 Pine Street; and, That the City of Kitchener enter into an Agreement of Purchase and Sale with the Estate of Peggy Yurkiw, the owner of 51 Pine Street, for the conveyance of Part 3, Plan 58R- 5120 for a price of $30,774. plus reimbursement of the City's incidental costs pertaining to this transaction, said agreement to be satisfactory to the City Solicitor; and further, That the Mayor and Clerk be authorized to execute all documentation, satisfactory to the City Solicitor, to convey Part 3, Plan 58R-5120 to the Estate of Peggy Yurkiw, the owner of 51 Pine Street." 5. CAO-09-046 - 2010 ECONOMIC DEVELOPMENT GRANTS The Committee considered Chief Administrator's Office report CAO-09-046, dated October 19, 2009 concerning review of annual community grants for economic development. Mr. R. Regier noted that a new strategy for community grants has been implemented with grants relative to economic development being transferred to the Economic Development Division in keeping with the 2007-2010 Economic Development Strategy. Mr. Bruce Antonello, Greater Kitchener Waterloo Chamber of Commerce, attended in support of the Health Care Recruitment Council's request for an annual grant in the amount of $20,000. Mr. Antonello spoke of the continued need for recruitment of family and specialized physicians to the community, advising that of the $20,000 contribution, $10,000 will be used toward family doctor recruitment and $10,000 will be used to aid local hospitals in recruiting physicians in specialized fields. He stated that while progress has been made the community is still short approximately 30 physicians in each of the two categories. He added that the City's investment in the Health Sciences Campus will help in this process as it is a known fact that many stay where they are trained, having established connections within the community. It was noted that a package of information provided by the Chamber in support of the grant request was not received by the Committee. It was also noted that Page 2 of report CAO-09- 046 was omitted in error and had been circulated to members of the Committee this date. Councillor J. Gazzola raised concerns as to how to correct the shortage of doctors, suggesting senior levels of government need to take action to ensure those trained remain for a period of time. Mr. Antonello commented that it was his understanding there is a return for service provided wherein tuition is forgiven for doctors who choose to stay and practice in Ontario for a FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -144 - CITY OF KITCHENER 5. CAO-09-046 - 2010 ECONOMIC DEVELOPMENT GRANTS (CONT'D) set number of years. He stated that it takes time for these changes to become evident given the length of time required to train a doctor and expressed confidence in the School of Pharmacy to improve this community's situation. Mayor C. Zehr requested clarification of the City's commitment to fund this group and Mr. Regier advised that the City entered into a 5 year funding agreement with 2010 being the last year of the agreement. Mayor Zehr expressed support for the program and acknowledged that while the Province has responsibility for education it does not prevent local municipalities from doing what they can to help solve this issue. He asked that the package of information from the Chamber be circulated to Council. On motion by Mayor C. Zehr- itwas resolved: "That subject to final 2010 budget approval and receipt of background and financial history of the organization, an annual operating grant for the Greater Kitchener UVaterloo Chamber of Commerce Health Care Recruitment Council in the amount of $20,000., as outlined in Chief Administrator's Office report CAO-09-046, be approved for 2010." Mr. John Jung, CEO, Canada's Technology Triangle (CTT), attended in support of the organization's grant request of $149,000. in 2010. He commented on CTT's plans to develop 5 year strategic and business plans, as well as action plans for investment, attraction, marketing, communications and research. The focus of their strategic direction will encompass outreach and catalytic leadership through raising awareness, knowledge management and fiscal stability. A breakdown of 2003-2009 funding levels was provided with municipal partners contributing 61 % in 2009, Federal /Provincial 18% and non-governmental 21 %. Mr. Jung announced plans to return in the spring to present further details of CTT's strategic direction and business plan. Councillor J. Gazzola suggested that the private sector is the greatest benefactor and should contribute at least 50%. Mr. Jung acknowledged that the private sector does benefit but noted the industry's belief in the importance of the City having a strong role to help facilitate continued attraction of new businesses to the area. Mayor C. Zehr also requested clarification of the City's commitment to fund this group and was advised that the City's commitment is intended to be long term. Mr. Regier added that the City did enter into a short term 3 year program in 2007 to ramp up the organization's grant allocation by approximately 2% per year over that period of time and this would be the last year of that program. Mayor Zehr requested that a financial history be provided prior to final budget consideration. On motion by Mayor C. Zehr- itwas resolved: "That subject to final 2010 budget approval and receipt of background and financial history of the organization, an annual operating grant for Canada's Technology Triangle in the amount of $149,000., as outlined in Chief Administrator's Office report CAO-09- 046, be approved for 2010." Mayor Zehr noted that no background information was provided for the Small Business Centre and Mr. Regier advised that City staff is responsible for preparation of this budget. He agreed to provide a draft budget priorto the next Council meeting. Councillor J. Gazzola raised concerns that no other delegates were in attendance to speak to the remaining grant requests. Councillor J. Smola suggested that the balance of the grant requests could be deferred pending arrangements with the organizations to make presentation. On motion by Councillor J. Gazzola - itwas resolved: FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -145 - CITY OF KITCHENER 5. CAO-09-046 - 2010 ECONOMIC DEVELOPMENT GRANTS (CONT'D) "That save and except the Greater Kitchener Waterloo Chamber of Commerce Health Care Recruitment Council and Canada's Technology Triangle, the balance of the Economic Development annual operating grants, as outlined in Chief Administrator's Office report CAO-09-046, be referred to the November 2, 2009 Council meeting to allow invitations to be extended to the organizations to make presentations in support of their grant applications." 6. FIN-09-120 -DEVELOPMENT CHARGES CREDIT I REFUND POLICY The Committee considered Financial Services Department report FIN-09-120, dated August 27, 2009 concerning development of a policy for use of Development Charge (DC) credit / refund agreements, used to facilitate construction ofgrowth-related capital projects. Mr. Stefan Kreczenowicz, Hemson Consulting, presented an overview, advising that the City's Kitchener Growth Management Plan (KGMP} and 10 year capital forecast will be used to manage the DC capital program. The new policy will support the KGMP by facilitating development in specific areas in a fiscally responsible manner; manage cash flow and ensure DC funds are not depleted for low priorities at the expense of high priority projects. The policy is intended to guide in making decisions as to whether or not to enter into acredit /refund agreement and provides a standardized approach. It was noted that while the policy is more restrictive than the City's past practice it is not as restrictive as policies adopted in other local area municipalities. It is intended that such agreements will be limited in use and generally considered only for high priority projects and for "hard" services required to open lands for development. The policy also provides support in promoting "green" infrastructure by allowing developers to pay for parks and trails up front. A report will be forwarded to Council prior to approving acredit /refund agreement, which will include anticipated impacts as a result of the proposed construction of the capital works. Credits /refunds will be limited to a specific service to ensure the City's ability to construct works in other services is not impacted. Payment of a refund will occur in the year the capital work is scheduled in the 10 year capital forecast and only when the City has achieved the projected DC revenue. The policy remains flexible in allowing front-ending agreements, allows developer tiered agreements and in providing other methods of refund repayments for high priority projects. Mr. Kreczenowicz advised that meetings were held with industry stakeholders and their suggestions, where feasible, have been incorporated. He pointed out that the policy is not required under the Development Charge Act and therefore, is not subject to appeals. Councillor J. Gazzola raised concerns regarding operating costs incurred by the City resulting from earlier development. Mr. Kreczenowicz suggested that such costs are off-set to some degree by new tax assessment; however, he pointed out that the impact of early development will be outlined in the staff report presented for consideration of entering into a credit (refund agreement. Councillor Gazzola questioned why the City's policy is less restrictive than other area municipalities. Mr. D. Chapman stated that this policy is more restrictive than the City's past practice of an open policy and is tied to the City's strategic planning processes to ensure a transparent and fiscally responsible approach. Mayor C. Zehr requested clarification as to the repayment of the actual cost of construction of the hard service and Mr. Chapman advised that there would be no carrying costs incurred by the City but there may be resulting operating costs as would be outlined in a report prior to approving acredit /refund agreement. Mayor Zehr requested clarification as to the difference between this policy and policies of other area municipalities. Mr. Chapman advised that such agreements are more strictly limited to the point of being discouraged in the other municipalities and no credit is provided at building permit issuance, with refund of the costs of the capital works provided at the time the work is scheduled in the capital forecast. Councillor Gazzola referred to the stakeholder comments and Mr. Chapman advised that the two submissions provided with the report are the culmination of several months of discussions and input from interested parties. He acknowledged that the suggestions proposed in the submissions are significantly different; however, in subsequent discussions he advised that their concerns had been generally satisfied. Mayor C. Zehr commented that the proposed policy benefits both the City and the developer to FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -146 - CITY OF KITCHENER 6. FIN-09-120 -DEVELOPMENT CHARGES CREDIT I REFUND POLICY (CONT'D) varying degrees dependent on circumstance of the project and allows the market place to drive the process at minimal risk to the City. Councillor J. Gazzola stated that the policy solidifies the process while remaining flexible to deal with differing circumstances and agreed that it is good for both parties. On motion by Mayor C. Zehr- itwas resolved: "That the City of Kitchener Development Charges Credit/Refund Agreement Policy, as attached to Financial Services Department report FIN-09-120, be approved." 7. CRPS-09-135 - TERMS OF REFERENCE -NOMINATING COMMITTEE The Committee previously considered Corporate Services Department reports CRPS-09-135 and CRPS-09-123, dated September 30 and September 3, 2009 respectively, at its meeting held October 5, 2009. At that time the matter was deferred pending consultation with various organizations to determine their interest in representation on the Nominating Committee. At the request of Mr. R. Gosse, it was agreed to defer consideration of this matter indefinitely as responses from all organizations contacted have not yet been received. In the interim, the existing Nominating Committee will remain. On motion by Mayor C. Zehr- itwas resolved: "That the following recommendation contained in Corporate Services Department report CRPS-09-123 (Terms of Reference -Nominating Committee), be deferred for further consideration to a future meeting of the Finance and Corporate Services Committee, pending responses from various organizations as to their interest in representation on the Nominating Committee: "That the Terms of Reference for the Nominating Committee, as attached to Corporate Services Department report CRPS-09-123, be approved." 8. FIN-09-138 - 2010 FEES AND CHARGES The Committee considered Financial Services Department report FIN-09-138, dated September 30, 2009 concerning a comprehensive review of proposed fees and charges for 2009. The list of fees includes all City fees and charges with the exception of Utility rates. Mr. S. Saleh advised that when setting individual rates, departments consider a range of factors including cost recovery, legislation, rates of other municipalities and market conditions. For 2010, departments were provided with a guideline of 5.2% for fee increases and, in general, most fees are increasing by this amount. This rate of increase helps to maintain parity with projected budget increases and also serves to mitigate property tax increases. A 5.2% increase in user fees amounts to approximately $965K of additional revenue for the tax- supported budget, which represents 1.09% of the levy. Mr. Saleh highlighted several fees proposed at higher andlor lower than the 5.2% guideline, including: community centre room rentals; Committee of Adjustment fees; tankless water heater rentals; and dog licensing fees. Increases range from 4.56 to 50.94% for community centre room rentals; 15% to 100.11 % for Committee of Adjustment fees; 3.45% to 9.09% for dog licensing fees; and a decrease on average of 35.9% for tankless water heater rental rates. Mr. Saleh advised that two new fees have been added to Utility Collections, being: a Utility Account Administration fee and a Collections Notice Delivery fee. These fees are standard to comparable Utilities and have been proposed as a cost reduction measure that is expected to generate approximately $100,000 to $200,000 per year. Mr. Saleh noted that the Harmonized Sales Tax (HST) is to take effect on July 1, 2010 and will be applicable on most City user fees. Staff is recommending that approval be given to adjust FINANCE AND CORPORATE SERVICES COMMITTEE CTOBER 26.2009 -147 - CITY OF KITCHENER 8. FIN-09-138 - 2010 FEES AND CHARGES (CONT'D) the user fees to reflect HST when it takes effect in July 2010 At the request of Mr. Saleh, it was agreed to add one additional fee, omitted in error from the comprehensive listing, being: an annual fee for Encroachment Agreements under Corporate Services -Legal. Ms. J. Evans provided explanation of the proposed Collection Notice Delivery fee, advising that this is a friendly warning notice sent one week in advance of cutting service to an account in arrears. The fee is to recover the City's cost of hand delivering the notice to the affected party and is provided to give opportunity to the property owner to rectify their account. Councillor J. Gazzola raised concerns with respect to the proposed community centre room rental rate increases. Ms. D. Campbell advised that staff undertook to standardize hourly rates for room rentals across all community centres and align these to comparable like size room rentals. She suggested that it made sense to align rates as many seeking to rent rooms often contact differing community centres to compare rates. She noted that in cases where groups are frequent users of community centre space and who may have difficulty with the increased rates, staff will undertake to mitigate these circumstances. Councillor K. Galloway questioned if consideration could be given to leaving one or 2 under- utilized community centres at a lower rate to encourage use of the facility. Ms. Campbell noted that those doing comparisons of rental rates are looking for like size space and not all spaces are alike. She added that staff could undertake an assessment of space usage. Mr. D. Hildebrand suggested that rather than lowering rates in a select number of centres, staff could look at lower rates for non-prime time usage across all centres. Mayor C. Zehr spoke in support of consistency in room rental rates, commenting that lowering rates in only 1 or 2 centres may create a shift in usage wherein, the selected centres become full while others then become under-utilized. He agreed that working with the organizations to mitigate circumstances and consideration of lower rates for non-prime time usage to maximize use of space would be a better approach. Councillor Galloway expressed concerns that the level of in-kind grant requests for room rentals would increase and inquired as to the feasibility of transferring monies to a specific fund to address these circumstances. Ms. P. Houston agreed to undertake consideration of this suggestion. Councillor J. Gazzola requested clarification of the proposed dog licensing fees. Ms. R. Upfold advised that the increases range from 3.45% to 9.09% over 2008 and are in line with those proposed by the City of Waterloo. In review, it was determined that to achieve full cost recovery increases of 100%+ would be required to off-set costs paid to the Humane Society and is not deemed realistic as past experience has shown that substantial increases result in a significant decline in licence purchases. Ms. Upfold agreed to provide the percentage of impound fees; however, noted that these fines are not substantive enough to off-set total costs paid. She added that the Humane Society cannot enter a premise to determine if a dog is licensed or not and can only act on decisive knowledge of an unlicensed dog. It was further noted that negotiation of a new contract with the Humane Society would be undertaken in 2010. Mayor C. Zehr inquired as to the process for dog license renewals. Ms. Upfold advised that the Humane Society maintains a list of all known licensed dogs and undertakes to send notices to the pet owner in December of each year. Advertisements are also placed in the spring of each year, with follow-up ads during the summer months. Hand delivered reminder notices are then provided to those who have not renewed a licence following the initial period of notice. Mayor C. Zehr inquired if all fees and charges have been compared to other area municipalities to ensure Kitchener remains competitive. Mr. Saleh advised that in most cases fees have been compared with a view to maintaining consistency. Mayor Zehr requested clarification of the increased fees for Committee of Adjustment. Mr. J FINANCE AND CORPORATE SERVICES COMMITTEE CTOBER 26.2009 -148 - CITY OF KITCHENER 8. FIN-09-138 - 2010 FEES AND CHARGES (CONT'D UVillmer advised that the fees have been adjusted to include a new component of cost recovery relative to work completed by the Development and Technical Services Department and are now in line with other area municipal fees. Councillor J. Gazzola noted that no increase in fees is proposed for the parking garage rates. Mr. J. Willmer advised that daily and monthly rates are proposed to be increased; however, hourly and short term rates are proposed to remain the same to maintain a favourable environment among competing interests in the downtown. Councillor Gazzola suggested that this sends the wrong message in respect to encouraging less use of motor vehicles. Councillor Gazzola inquired if consideration could be given to decreasing all fees to off set future addition of the HST. Mr. D. Chapman advised that the HST is intended to be a user tax which should not be borne by the City and it was his understanding a form of tax credit would be made available in 2 years time to all eligible persons. Mayor Zehr commented that while regrettable, the HST is the policy of another order of government and steps should betaken against any downloading of associated costs. At the request of Councillor J. Gazzola, the following motion was voted on in 3 separate parts. Relative to Paragraph 1: the proposed 2010 Utility Collection Notice Delivery fee was voted on and Carried; the proposed 2010 Community Centre Room Rental Rates was voted on and Carried; and finally, the balance of the proposed fees and charges contained in the 2010 Comprehensive Fee Review, as amended to add an annual fee for Encroachment Agreements under Corporate Services -Legal, together with paragraphs 2, 3 and 4 of the motion, was voted on and Carried. On motion by Councillor J. Gazzola - itwas resolved: "That the proposed fees and charges contained in the 2010 Comprehensive Fee Review, as attached to Financial Services Department report FIN-09-138 and as amended to include an annual fee for Encroachment Agreements under Corporate Services -Legal, be approved; and, That the Manager of Cemeteries be directed to forward the Cemetery Tariff of Fees and Charges to the Ministry of Government Services -Cemeteries Regulation Unit for filing; and, That staff be authorized to amend the user fees as necessary to reflect the new Harmonized Sales Tax which is expected to come in effect as of July 1, 2010, as per Provincial Legislation; and further, That Legal Services staff be directed to prepare the necessary by-laws to amend The City of Kitchener Municipal Code Chapters for fees and charges pertaining to licensing, planning applications, and Committee of Adjustment applications." 9. FIN-09-132 - CENTRE IN THE SQUARE LONG TERM CAPITAL FUNDING STRATEGY The Committee considered Financial Services Department report FIN-09-132, dated September 16, 2009 concerning the annual general provision forthe Centre in the Square. Mr. R. Lebrun advised that as a result of new tangible capital asset accounting standards (PSAB 3150), a review determined that the City owns the land and building but the Centre in the Square has control over the assets; and that all assets, including land and building, should be reported as the Centre's assets on their financial statements. A breakdown of the Centre's proposed 20 year capital program was provided, which demonstrates a funding shortfall. In order to fully fund the 20 year capital program an increase in the City's capital provision from $124,000 to $248,000 is requested. FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -149 - CITY OF KITCHENER 9. FIN-09-132 - CENTRE IN THE SQUARE LONG TERM CAPITAL FUNDING STRATEGY (CONT'D) Mr. J. Grant, General Manager, Centre in the Square, responded to questions, agreeing to provide a summary of capital expenditures over the previous tenure of the Centre. Mr. Grant provided a breakdown of funding sources, including: a ticket surcharge; contribution from the City; and fundraising programs. Councillor Gazzola questioned how the City's contribution is to be spent. Mr. Chapman advised that the monies are not defined for a specific area but rather is the City's overall program share. Responsibility is delegated to the Centre as to how to raise funds for the capital program, with the City's share to fund the balance in recognition that it is a City asset that requires maintaining. Councillor Gazzola noted that no increase is proposed for the ticket surcharge over the 20 year period. Mr. Grant advised that the surcharge is already at high end within the industry and will be impacted by introduction of the HST in 2010. Councillor G. Lorentz requested clarification in respect to the direction to be taken over the 20 year program. Mr. Grant emphasized that no different or new changes to the facility is proposed but rather the program is set to maintain the building as it exists today. Mayor Zehr requested clarification of a projected deficit in 2014. Mr. Grant advised that this relates to cash flow. He pointed out that fundraising is strictly an estimate and over time, there may be more capital requirements in a given year than available dollars necessitating decisions that may delay capital improvements. Mayor Zehr agreed that the City's contribution should not be earmarked for specific items as the Centre has carriage of the asset but questioned how the Centre would ensure the City's funding is used for the building. Mr. Grant advised that the proposed funding breakdown under the defined model is felt to be close to what is required for the building and if approved, will allow the facility to be maintained in good state. On motion by Mayor C. Zehr- itwas resolved: "That subject to final 2010 budget approval, the City's annual general provision for Centre in the Square capital projects be increased from the current level of $124,000. per year to $248,000. per year, indexed for inflation across the ten-year capital forecast, as outlined in Financial Services Department report FIN-09-132." 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST The Committee considered five department reports and a report from the Kitchener Public Library (KPL), as outlined below, regarding referral of projects to the 2010-2019 Capital Forecast. Mr. D. Chapman advised that all new capital projects with budgets in excess of $50,000. are referred to the 10-year Capital Forecast by resolution of Council. It was noted that a decision this date does not constitute a final decision on the projects but rather allows them to advance to consideration as part of the 2010 budget deliberations. a} FIN-09-135 -FINANCIAL SERVICES DEPARTMENT The Committee considered Financial Services Department report FIN-09-135, dated September 30, 2009 regarding capital projects proposed to be included in the 2010-2019 Capital Forecast. Mr. D. Chapman advised that Financial Services has 13 capital projects for referral, of which 12 relate to Utilities. Mr. Chapman spoke to proposed inclusion of a Long Term Financial Plan to integrate and expand on existing financial strategies and tools. The plan will articulate in financial terms, the results intended to be achieved by the City over the next 20 year period. The estimated cost of development of the plan is $150,000. Mayor C. Zehr commented that he was of the understanding that ability for long term planning was included in the DELTA project and requested clarification. Mr. Chapman stated that this type of plan is not commonly found in any financial system as it provides FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -150 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST a) FIN-09-135 -FINANCIAL SERVICES DEPARTMENT (CONT'D) higher level conceptual growth management planning and benchmarking requirements. Ms. J. Evans and Mr. W. Malcolm spoke to the remainder of proposed capital projects. Councillor Gazzola questioned the status of smart meter installations. Mr. Malcolm advised that Ontario Hydro is regulated to install smart meters and the City is currently in discussions with Kitchener-Wilmot Hydro and the supply company to undertake a pilot project for water meters. Installation of the technology is subject to approval by Measurement Canada and until received, the City cannot consolidate gas and water meters with electricity meters. He added that it will require significant resources, noting a preliminary quotation that has been received in the amount of $11 M for replacement water meters. Ms. Evans advised that purchase of Bluetooth technology is requested to replace failing Itron meter reading equipment so as to reduce maintenance and repair costs. She anticipated that the investment would have a 4 to 5 year payback and it is not expected that the smart meter technology would be in place prior to that period of time. Mayor Zehr questioned if the replacement water meters would be compatible with smart meter technology. Mr. Malcolm advised that they could be adapted at an anticipated increased price range of double the present day cost of a new meter. Mayor Zehr noted that Hydro is legislated to install smart meters and questioned if there is any existing or pending legislation to require gas and water utilities to do likewise. Mr. Malcolm advised there is currently no legislation of that nature. Mayor Zehr stated that while he believed the City should be moving in that direction it was his hope that it is being kept in mind that the investments being made will be compatible and that there will be no throw away costs. Councillor J. Gazzola questioned why these capital costs had not previously been included in the capital forecast. Mr. Malcolm advised that over time as meters age they measure water flow less accurately. On recent review of existing meters, a number have been found not meeting the standard resulting in loss of revenue and it was determined replacement was necessary. Councillor G. Lorentz questioned that if the smart meter technology came into place earlier than the next 5 years if the figures would change. Mr. Malcolm concurred, noting that a shorter timeframe would result in an increase in costs but reiterated installation is dependent on approval by Measurement Canada. On motion by Councillor G. Lorentz - itwas resolved: "That the following capital projects be included in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as outlined in Financial Services Department report FIN-09-135: Financial Planning Long Term Financial Plan $150, 000 2010 Revenue Itron Project $150, 000 2010 Utilities -Water Replacement Water meters $ 232,000 2010 $115, 000 2011 $118, 000 2012 $120, 000 2013 $122, 000 2014 $126, 000 2015 $128, 000 2016 FINANCE AND CORPORATE SERVICES COMMITTEE CTOBER 26.2009 -151 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST a) FIN-09-135 -FINANCIAL SERVICES DEPARTMENT (CONT'D) $130, 000 2017 $134, 000 2018 $136, 000 2019 Victoria South Water Main $ 400,000 2010 Breithaupt Water Quality $125,000 2010 Lead Service Replacements $ 48,000 2010 $ 50,000 2011 $ 51,000 2012 l ltilitiP~ - (~a~ Uncommitted Gas Mains $100,000 2010 $102, 000 2011 $104, 000 2012 New Large Meter Installs $100,000 2010 Vanier Regulator Station Upgrade $100,000 2010 Large Stat Meter Installs $100,000 2010 Infrastructure Replacement Provision $ 300, 000 2012 $ 300, 000 2013 $ 300, 000 2014 $ 300, 000 2015 $ 300, 000 2016 $ 300, 000 2017 $ 300, 000 2018 $ 300, 000 2019 Regulator Pit Remediation $ 300,000 2010 Replacement Gas Meters $ 205,000 2010 $ 208,000 2011 $ 217,000 2012 $ 220, 000 2013 $ 223, 000 2014 $ 227, 000 2015 $ 234, 000 2016 $ 236, 000 2017 $ 243, 000 2018 $ 244,000 2019." b} CAO-09-044 -CHIEF ADMINISTRATOR'S OFFICE The Committee considered Chief Administrator's Office report CAO-09-044, dated October 7, 2009 regarding a capital project proposed to be included in the 2010-2019 Capital Forecast. FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -152 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST b) CAO-09-044 -CHIEF ADMINISTRATOR'S OFFICE (CONT'D) Mr. H. Gross advised that as part of the Consolidated Maintenance Facility project, the City intends to sell surplus lands on the north side of Ottawa Street currently used for the Elmsdale Operations Centre. It has been determined that the best use of the lands is for commercial purposes and a Phase 2 Environmental Site Analysis indicates that remediation will be required at an estimated cost of $3M. The City can sell the lands "as is" on condition the new owner completes the required remediation as part of the redevelopment proposal. A private sector owner would be eligible to take advantage of the Region of Waterloo Brownfield Financial Incentive Program which provides grant assistance for Phase 2 studies; reduction in Regional Development Charges; and a Tax Incremental Grant (TIG) to which the City is a partner with the Region. This is felt to be the best way to market the lands and if approved, the City would be required to make incremental payments over a 5 year period to cover a portion of the remediation, with the balance covered by the Regional program. Councillor J. Gazzola questioned if this was taken into account as part of the business case. Mr. Gross advised that a detailed investigation as to the extent of remediation costs was not available at time of the business case. Councillor Gazzola questioned the calculations made in Table 1 under "Annual Taxes". Mr. Gross acknowledged that the $93,097.38 figure in Column 2 beside "Area Municipal" should be corrected to read $193,097.38 and the $264,450.40 figure in Column 3 beside "Total Municipal Taxes" should be corrected to read $284,450.40. Councillor Gazzola questioned the value of the existing building on the site and was advised that this figure could not be disclosed at this time as it is part of negotiations for sale of the lands. Councillor Gazzola questioned the rationale for using the Regional program, suggesting that the City is contributing both at the municipal and Regional level. Mr. Gross responded that the City has 2 options, one to absorb the cost of remediation and sell the lands in a clean state; or seek financial assistance in remediating the lands to avoid paying full costs, the latter of which requires the lands to be in private ownership. Mayor Zehr requested clarification as to the proposed closing of the sale in 2011. Mr. Gross advised that the closing date assumes vacancy of the building in mid to late 2010, sale of the property in mid-2010, clean-up in 2011 and construction start in 2012. Mayor Zehr suggested that the timeline seems tight in the absence of a willing buyer. Mr. Gross advised that a number of interested parties are awaiting marketing of this property and agreed to provide information to Council in this regard as it relates to the timelines. On motion by Mayor C. Zehr- itwas resolved: "That the following capital project be included in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as outlined in Chief Administrator's Office report CAO-09-044: Brownfield TIG -Elmsdale Lands $174,062 -Years: 2013, 2014, 2015, 2016 $153,198 -Years: 2017." c) CRPS-09-124 -CORPORATE SERVICES DEPARTMENT The Committee considered Corporate Services Department report CRPS-09-124, dated October 2, 2009 regarding capital projects proposed to be included in the 2010-2019 Capital Forecast. Mr. T. Speck advised that Corporate Services is requesting the addition of 4 new capital projects related to: an upgrade of the AMANDA system; maintenance of the Charles / Benton Parking Garage; maintenance of the Sportsworld Crossing facility; and associated costs for the increase in size of Council. He added that two maintenance add-ons have been identified for the splash pads at McLennan Park and Kingsdale Community Centre, and proposed minor upgrades for the Kingsdale Community Centre in 2012. FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -153 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST c) CRPS-09-124 -CORPORATE SERVICES DEPARTMENT (CONT'DI Councillor J. Gazzola questioned the impact of not proceeding with the AMANDA system upgrade. Mr. S. Turner advised that this would delay the City's ability to improve their business processes and it is uncertain as to how long the current version of the program will continue to be supported by the supplier. It was noted that the City currently uses version 4.4 and the latest upgrade is version 5. Councillor Gazzola suggested that delaying the upgrade would not place the City that far behind. Mr. Turner responded that in strict terms of version numbers that would be correct; however, in terms of functionality, the newest version offers significant improvements. Councillor Gazzola questioned if the upgrade would be reflected in reduced staffing. Mr. Turner advised that the focus is on improving client services but noted that staff is in discussions concerning future deferral of staffing costs. He added that the upgrade will improve integration with other City systems and allow movement toward increased on-line services. Councillor Gazzola questioned if staff could make do without the upgrade and Mr. Turner advised that was possible; however, he reiterated that the primary concern is how long the current version will continue to be supported by the supplier. Councillor J. Gazzola referred to the addition of the new Sportsworld arena, questioning if any economy of scale in staffing is being achieved as a result of acquiring the larger facility. Mr. T. Speck advised that the capital funding is for ongoing maintenance costs and future facility upgrades and is not reflective of operating costs. On motion by Councillor K. Galloway - itwas resolved: "That the following capital projects be included in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as outlined in Corporate Services Department report CRPS-09- 124: Project Name Project Cost Project Year AMANDA System $346,000. 2010-2013 Charles & Benton Parking Garage Maintenance $206,000. 2012-2019 Sportsworld Crossing Maintenance $387,000 2011-2019 Increase in Size of Council $ 99,000 2011-2019." d} CSD-09-056 -COMMUNITY SERVICES DEPARTMENT The Committee considered Community Services Department report CSD-09-056, dated October 5, 2009 regarding capital projects proposed to be included in the 2010-2019 Capital Forecast. Ms. P. Houston advised that Community Services is requesting the addition of 5 new capital projects, including: expansion of the Bridgeport Community Centre; completion of the McLennan Park development; implementation of the Parks Master Plan recommendations, which includes improvements to existing community trails and new trail development, management plans for environment / naturalization, general park development and rehabilitation, and sportsfield conversions from grass turf to synthetic; improvements to the Sportsworld Crossing Twin Pad; and UVilliamsburg Cemetery Phase II and Mausoleum. Ms. Houston pointed out that presentations are pending to the Community Services Committee following this meeting on the Parks Master Plan recommendations and the vVilliamsburg Cemetery Phase II /Mausoleum. On motion by Mayor C. Zehr- itwas resolved: "That pending presentations to the Community Services Committee, the following capital projects be referred to the November 2, 2009 Council meeting for consideration of inclusion in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -154 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST d) CSD-09-056 -COMMUNITY SERVICES DEPARTMENT (CONT'D) outlined in Community Services Department report CSD-09-056: Capital Project Amount Year 1. Parks Master Plan Recommendations 3.1 Community Trails $1,160,000. 2011-2019 3.2 Environment/Naturalization $800,000. 2014-2019 3.3 General Park Development $1,215,000. 2011-2019 3.4 General Park Rehabilitation $1,000,000. 2013-2019 3.5 Sportsfield Synthetic Turf $1,299,000. 2019 Conversions 2. Uvilliamsburg Cemetery Phase II and Mausoleum $4,957,000. 2010-2019." Councillor J. Gazzola questioned if there were other funding options to meet the City's 1/3 share of the stimulus funding for the Bridgeport Community Centre expansion without adding to the capital budget. Mr. D. Chapman advised that while options for alternate funding have been found for other stimulus projects, in this instance no other option is available. On motion by Mayor C. Zehr- itwas resolved: "That the following capital projects be included in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as outlined in Community Services Department report CSD-09- 056: Capital Project Amount Year 1. Bridgeport Community Centre $351,000. 2010 2. McLennan Park (timing change) $0. 2010-2015 3. Sportsworld Crossing Twin Pad Improvements $300,000. 2010." e} DTS-09-162 -DEVELOPMENT & TECHNICAL SERVICES DEPARTMENT The Committee considered Development and Technical Services Department report DTS- 09-162, dated October 21, 2009 regarding capital projects proposed to be included in the 2010-2019 Capital Forecast. Mr. G. Murphy spoke to a number of capital infrastructure projects proposed for inclusion in the capital forecast, as outlined in Table 1 of report DTS-09-162. Mr. Murphy advised that the main components relate to the City's Accelerated Infrastructure Replacement Program and represent a move toward a sustainable program by 2032. Projects also relate to annual infrastructure capital programs for roads, sewers and watermains; new infrastructure capital projects, as detailed in Appendix "A" to report DTS-09-162; and development charges projects related to growth. Mr. Murphy advised that the title of the project referenced as "Stormwater Utility Initiative" in Appendix "A" (Project Scope) should be changed to "Stormwater Management Utility Implementation Plan" in keeping with its identification in Table 1. Mayor C. Zehr questioned if the City has been able to achieve its accelerated infrastructure replacement targets. Mr. Murphy advised that the City strives to achieve a target of 8.6km / year and is currently approximately 30km behind. Mayor Zehr questioned if funding for the shortfall is still intact. Mr. Murphy advised that 2 years ago a report requesting adjustment to the per km costs was approved and the funding allocated is based on the new rates. He noted that the allocation has been expended in each year and with rising costs, is not achieving as much as desired. Mr. Murphy added that a small amount of uncommitted funding remains but is not relative to the cost of completing the shortfall of 30km. Mayor Zehr requested assurance that the proposed funding in 2010 will allow targets to be met, FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -155 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST e) DTS-09-162 -DEVELOPMENT & TECHNICAL SERVICES DEPARTMENT (CONT'D) suggesting that if the work cannot be physically completed it may be an area where funding can be deferred. Mr. Murphy responded that the intent of the project scope report is to have an understanding of all projects in 2010 and demonstrates multiple priorities. He stated that he was confident that the City can deliver on the Accelerated Infrastructure Replacement Program but noted that there are many competing interests, not just in respect to Kitchener projects, but also from projects planned in other municipalities. Mayor Zehr raised concerns in respect to meeting timelines associated with stimulus funding projects, commenting that if there will be need to bring in outside consultants to accomplish completion of these projects it would be better to know at this time in context of review of the overall package. Mr. Murphy stated that in discussions with staff it is felt the program proposed is workable; however, matters may arise as projects progress, particularly, on the development side that may impact timelines. He added that he was more confident that targets can be met in respect to infrastructure renewal than in development projects given the number of interested parties that may be involved in the latter. Mayor Zehr suggested that timelines should be carefully monitored and Council notified several months in advance of any need to address timeline shortfalls. Councillor J. Gazzola referred to funding allocated to stormwater management, questioning the impact of these funds not being included. Mr. Murphy advised that the majority of this funding is being added to the back end of the capital forecast and is to address the gap in current service levels and potentially provide opportunity to increase service levels. He added that if not included the funding shortfall would be transferred into the sewer and water rates and he cautioned that the funding requested is not representative of a sustainable level but rather is only a starting point. On motion by Councillor G. Lorentz - itwas resolved: "That the infrastructure capital projects and programs listed in Table 1 below, be included in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as outlined in Development and Technical Services Department report DTS-09-162: Table 1 - 2009 Capital Infrastructure Project Fundin_q Request ALPINE -HOMER WATSON WALKWAY RES-FEDGAS 126 EDGEHILL /BAXTER STORM OUTLET C/C 100 FREDERICK ST - EAST TO BRUCE C/C 218 FREDERICK ST - EAST TO BRUCE ENT-SAN 534 LIMERICK DR DRAINAGE IMPROVEMENTS C/C 150 OTTO ST - FREDERICK TO END RES-FEDGAS 581 25 STRASBURG RD WALKWAY-CEDARHILL RES-FEDGAS 90 WARDS POND &STRASBURG CREEK C/C 1100 WOOLWICH ST - BRIDGE ST TO ENT-WAT 200 WAT' L00 WOOLWICH ST - BRIDGE ST TO WAT' L00 RES-FEDGAS 14 167 40 CHARLES & BENTON GARAGE MONITORING C/C 33 35 CIVIC DISTRICT GARAGE MONITORING C/C 35 CIVIC DISTRICT PARKING GARAGE ENT-DEB 2195 CIVIC DISTRICT PARKING GARAGE OTHER 11500 DRAINAGE IMPROVEMENT PROGRAM C/C 50 50 50 50 50 50 50 50 50 50 HURON RD WATERMAIN - EAST OF FISCHER-HALLMAN DC 362 HURON RD WATERMAIN - WEST OF FISCHER-HALLMAN DC 757 OVERLAND DR -BRIDGE REHABILITATION RES-FEDGAS 726 FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -156 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST e) DTS-09-162 -DEVELOPMENT & TECHNICAL SERVICES DEPARTMENT (CONT'D) Table 1-2009 Capital Infrastructure Project Funding Request (Cont'd~ PROJECT MANAGEMENT INITIATIVE PROJECT MANAGEMENT INITIATIVE PROJECT MANAGEMENT INITIATIVE DC ENT-SAN ENT-WAT 30 30 30 SHIRK PLACE BRIDGE REHABILITATION RES-FEDGAS 250 SOUTHWEST KITCHENER TRANSPORTATION STUDY DC 153 STIRLING AVE BRIDGE REHABILITATION AT G.E.X.R OVERPASS C/C 400 STORM WATER MANAGEMENT MAINTENANCE PROGRAM C/C 205 211 216 221 226 231 236 241 245 SWM POND RETROFIT PROGRAM C/C 1100 1130 1159 1187 1215 SWM UTILITY IMPLEMENTATION PLAN C/C 80 SUMP PUMP CONNECTIONS ENT-SAN 180 184 187 191 195 199 203 207 211 215 TRANSPORTATION MASTER PLAN DC 366 SCHNEIDER CREEK BRIDGE (AT WABANAKI RES-FEDGAS 380 WATERCOURSE IMPROVEMENT PROGRAM C/C 625 681 736 789 840" Fire Chief T. Beckett advised that Fire Services is requesting two capital projects to be added to the 10 year capital forecast, including: allocation for the Fire Services Accreditation Program over a 5 year period; and purchase of new self contained breathing apparatus. Councillor J. Gazzola requested clarification of the accreditation program. Fire Chief Beckett advised that the program undertakes an independent review of existing business practices to ensure Fire Services is aligned to the best industry standards and is meeting strategic plan and operating objectives. It was noted that Fire Services has been involved in the accreditation program for the past 6 years and without the required funding, there would be no independent review of their operations to ensure they are compliant. Councillor Gazzola questioned the impact of reallocating $1 M from the Fleet account for acquisition of the breathing apparatus. Fire Chief Beckett advised that this funding allocation is achievable due to staff taking advantage of the stronger Canadian dollar, and use of other innovative approaches in the purchase of fleet equipment. He added that staff has also undertaken a review of best practices in equipment replacement with a view to achieving longer life spans. It was noted that this allocation is intended for expenditure in 2010. On motion by Councillor G. Lorentz - itwas resolved: "That $20,000 every five years, starting 2011, for the Fire Department Accreditation Program, and $1,040,000 for the costs for new self contained breathing apparatus, be included in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as outlined in Development and Technical Services Department report DTS-09-162." f) KITCHENER PUBLIC LIBRARY The Committee was in receipt this date of Kitchener Public Library (KPL) report, dated October 16, 2009 regarding capital projects proposed to be included in the 2010-2019 Capital Forecast. Ms. Sonia Lewis, CEO, Kitchener Public Library, advised that 2 capital projects are requested for inclusion, being: re-introduction of Radio Frequency Technology (RFID - automated check-in) and replacement /major upgrade of the Library Automation System. She added that the Library is also requesting $100,000 from the City's Telephone Reserve FINANCE AND CORPORATE SERVICES COMMITTEE OCTOBER 26.2009 -157 - CITY OF KITCHENER 10. DEPARTMENTAL PROJECT REFERRALS TO THE 2010-2019 CAPITAL FORECAST f) KITCHENER PUBLIC LIBRARY (CONT'D) Fund to which the Library has contributed toward pursuit of a shared system which is no longer deemed viable. Councillor J. Gazzola requested clarification of the request for $100,000 for a new telephone system. Ms. Lewis advised that the KPL has contributed to the City's telephone reserve fund over a number of years in anticipation of a shared system, but has never come to fruition. The Library is now ready to proceed to the next generation of systems and as these are network based, City staff advise a shared system is no longer feasible as the Library and City networks cannot be combined for reasons of security. Accordingly, the KPL is requesting return of their contributions so they may proceed independently. Councillor Gazzola requested clarification of the difference between the RFID and the Library Automation System. Ms. Lewis advised that the latter is the operating system for core library functions such as checking in-out services, on-line services and ordering materials. The RFID is an inventory system to secure the Library's collections and facilitates the checking in-out process. Councillor Gazzola questioned how expedient the need for funding is given the request is for inclusion in 2019. Ms. Lewis pointed out that the system was initially installed in 1992 and there is need to go back to the market to ensure the Library is keeping up with the latest technology. She added that funding was previously allocated earlier in the capital forecast for these projects but was subsequently removed to accommodate the Central Library project, as it was deemed to be of higher priority. On motion by Councillor K. Galloway - itwas resolved: "That the following capital projects be included in the 2010-2019 capital forecast for consideration by the Finance and Corporate Services Committee as part of the 2010 budget deliberations, as outlined in Kitchener Public Library report (S. Lewis), dated October 16, 2009: Radio Frequency Technology $450,000 2019 Library Automation System Replacement $200,000 2019; and further, That $100,000 from Kitchener Public Library's contributions to the City's telephone reserve be allocated to the library in 2010 for telephone system replacement." 11. ADJOURNMENT On motion, the meeting adjourned at 4:35 p.m. J. Billett Committee Administrator