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Home My WebLink AboutDTS-10-015 - Victoria Park Lake - Implementation of Class EA StREPORT REPORT TO: Councillor B. Vrbanovic, Chair, and Members of the Finance and Corporate Services Committee DATE OF MEETING: January 11, 2010 SUBMITTED BY: Grant Murphy, Director Engineering Services PREPARED BY: Grant Murphy, Director Engineering Services WARD(S) INVOLVED: All DATE OF REPORT: January 4, 2010 REPORT NO.: DTS-10-015 SUBJECT: VICTORIA PARK LAKE – IMPLEMENTATION OF CLASS EA STUDY RECOMMENDATION: For information only. BACKGROUND: Over the past several years, there have been many studies which made recommendations to Council about required infrastructure improvements or established the need for the City to put into place long-term preventive system maintenance and monitoring programs, in order to provide source water protection and protect the local environment. One such study, initiated in 2008, was the Victoria Park Lake Class Environmental Assessment (EA) Study. It explored alternatives and provided a preliminary design that addressed Victoria Park Lake’s sediment accumulation and water quality problems. The Class EA Study Report was received and approved by Council on June 15th 2009 (DTS Report 09-096). REPORT: As part of the 10 year (2010 to 2019) capital forecast process, staff analyzed options to implement the Class EA Study Report recommendations. However, it was determined that the Victoria Park Lake and associated upstream projects could not be included in the forecast until 2019. On November 23, 2009 Council provided further direction to staff to develop an implementation plan which would see phasing of the preferred alternative of the Victoria Park Lake Class EA Study much sooner than 2019. The budget issue paper will discuss potential phasing of implementation and funding options for Council’s consideration. FINANCIAL IMPLICATIONS: The attached budget issue paper will be included as part of the 2010 capital budget deliberations. ACKNOWLEDGED BY: Jeff Willmer, General Manager, Development and Technical Services Appendix “A” - Budget Issue Paper - Victoria Park Lake – Implementation of Class EA Study ïì ó ï CITY OF KITCHENER 2010 BUDGET ISSUE PAPER #44 ISSUE: Victoria Park Lake – Implementation of Class EA Study FUND: Operating/Capital DEPARTMENT: Development & Technical Services DIVISION:EngineeringServices BACKGROUND: In 2008 the City initiated a Class Environmental Assessment Study to explore alternatives and prepare a preliminary design that addresses Victoria Park Lake’s sediment accumulation and water quality problems. The Victoria Park Lake study area comprises Victoria Park Lake and the Schneider Creek Watershed upstream of the lake, which includes the Upper Henry Sturm Greenway, the Lower Henry Sturm Greenway, Detweiler Greenway, Sandrock Greenway, and Westmount Drain. The Class Environmental Assessment (EA) Study Report was received and approved by Council th on June 15 2009 (DTS Report 09-096). The preferred alternative for the Victoria Park Lake is Alternative 3 – Reconfigure Lake to Improve Function. The main features of this alternative are dredging of sediments, deepening of the Lake, construction of a sediment forebay at the upstream end of the Park, while maintaining the general configuration of the Lake. A key objective of the Study was to identify solutions which would improve the quality of the water before it enters Victoria Park Lake and include several new or retrofit storm water management opportunities. RATIONALE/ANALYSIS The Class EA Study Report estimated the cost of these projects to be $9.45M (Class “C” estimate). The cost estimate was revised to approximately $16M based upon additional information from other stormwater management pond retrofit work already tendered and taking place in the City in 2009. As part of the 10 year (2010 to 2019) capital forecast process, staff analyzed options to implement the Class EA Study Report recommendations. However, it was determined that the Victoria Park Lake and associated upstream projects could not be included in the forecast until 2019. This was mainly due to many other funding commitments of higher priority and Council direction to minimize tax levy impacts in 2010. On November 23, 2009 Council provided further direction to staff to develop an implementation plan which would see phasing of the preferred alternative of the Victoria Park Lake Class EA Study much sooner than 2019. The budget issue paper will discuss potential phasing of implementation and possible funding options available to Council for consideration. Proposed Implementation Phasing The Class EA Study Report provided a phasing plan over a five (5) year period, starting in 2009 with final completion in 2013. Staff have revisited this phasing plan, taking into consideration existing capital infrastructure project commitments for 2010. Based upon this assessment, it is not anticipated that detailed engineering design work could begin before 2011, with construction not starting until 2012. The following sequence for the implementation is proposed, based upon the Class EA Study recommendations and adjusted for commencement in 2011: ïì ó î Table 1 - Proposed Sequence of Implementation TaskYear Detailed Design (Lake components) 2011 Phase 1 Construction (Lake components) 2012 Detailed Design (Upper Henry Sturm Greenway Ponds and 2012 Restoration) Phase 2 Construction (Upper Henry Sturm Greenway Ponds and 2013 - 2014 Restoration) Detailed Design (Lower Henry Sturm Greenway ponds) 2013 Phase 3 Construction (Lower Henry Sturm Greenway ponds) 2014 - 2015 Detailed Design (Lower Henry Sturm Greenway Restoration) 2014 Phase 3 Construction (Lower Henry Sturm Greenway 2015 Restoration) FINANCIAL IMPLICATIONS: The capital cost of implementing recommendations of the study are shown in Table 2 and for the purposes of this discussion the total costs are estimated to range from $10M to $16M (Class “C” estimate). A significant increase in construction costs has recently been noted for a variety of project work funded under the Infrastructure Stimulus Program and the Community Adjustment Fund, due to competition for both labour and material resources. Table 2 – Victoria Park Lake Improvements – Estimate of Capital Cost Requirements ComponentsDescription of Work Range of Estimated Capital Cost* Lake-based Improvements Forebay construction and $1.4M to $2.8M deepening lake Dredging and disposal of existing $5.7 to $7.6M sediment Sub-Total$7.1M to $10.4M Upstream Improvements Upstream SWM, new ponds and retrofits of existing ponds, creek restoration measures $2.4M to $4.8M Total$9.5M to $15.6M * including contingency and engineering in 2009 dollars (Class “C” estimate) Potential Funding Sources There have been attempts to implement the recommendations of the Class EA Study Report as part of the ten (10) year (2010 to 2019) capital forecast process. However from a financial perspective, it was determined by staff that the Victoria Park Lake and associated upstream stormwater management projects could not be included in the forecast until 2019. This was mainly due to many other funding commitments of higher priority and Council direction to reduce the tax levy in 2010. ïì ó í Three (3) options for funding the Victoria Park Lake and upstream stormwater management works are presented for Council’s consideration: 1) Reallocate between $10M to $16M of tax-base supported funding by reprioritizing existing projects in the ten (10) year capital program, specifically between 2011 and 2015. It is anticipated that $2.9M would be required annually for the Victoria Park Lake and upstream works. The Development Charges reserve fund cash flow would be re- adjusted to shift $1.425M in eligible D/C funding into 2011, in order to initiate detailed design work. A detailed re-prioritization of projects is not provided with this report, however the following infrastructure programs would be reduced in the capital forecast on an annual basis: a) roads re-surfacing program ($1.2M), b) accelerated infrastructure renewal program ($1.2M), c) stormwater management and drainage projects ($0.5M) This approach would reduce road resurfacing by 19 lane kilometres annually or 95 lane kilometres over 5 years; and reduce the accelerated infrastructure renewal program by 1.8 kilometres annually or about 9 kilometres over 5 years. This approach further increases the City’s infrastructure deficit in these areas and is not recommended by staff. 2) In 2009, applications for infrastructure stimulus funding were pursued by the City to the federal and provincial governments in order to complete dredging of Victoria Park Lake. The City was not successful in its attempt to obtain funding for this project. Staff have considered the Community Adjustment Fund (CAF) as an option for funding the Victoria Park Lake and upstream works. However, these grants impose timelines that are not realistic given the potential scope of the work being proposed (5 year project). In the case of CAF, the work would have to be completed by March 31 2011. Staff resource limitations raise the risk of not completing all the work prior to the grant deadline. This will require the Engineering Services Division to re-direct resources away from projects and programs already committed to in 2010. This scenario would result in partial implementation of the plan, exposing the City to construction or financial related risks. This approach is not sustainable and is subject to the whim of federal and provincial levels of government, as such is not recommended by staff. 3) Implement a stormwater rate structure which will be applied to all property owners in the City. Council received reports DTS 09-042 and DTS 09-131 on October 6, 2009, which identified the need for a sustainable funding source for stormwater management programming. Options were presented to Council to fund an annual sustainable level of service for stormwater management of $9.9M (2007 dollars), beginning in 2011. Approximately 59% of the sustainable service level is already being funded from the tax base, and as such this proposal would see an additional 41% funded through a rate structure. Implementation of a stormwater rate would generate an adequate level of funding for the Victoria Park Lake and upstream stormwater management works in a sustainable and timely manner. This approach best achieves the objectives of Council and is th recommended by staff. Staff will bring forward a report on January 18 2010 for Council’s consideration as part of the final 2010 budget deliberations. ïì ó ì CONCLUSION: The completion of the Victoria Park Lake Class Environmental Assessment Study Report has established a preferred alternative for addressing the water quality issues of Victoria Park Lake. Council has directed staff to provide an implementation plan which would see completion of the preferred alternatives prior to 2019. An expedited phasing plan is presented for consideration, beginning in 2011 and construction being complete in 2015. The estimated cost for implementation ranges from $10M to $16M, but it is reiterated that without a sustainable funding source this expedited phasing plan is not achievable. Three (3) options were considered for funding the remediation of Victoria Park Lake; re- prioritization of projects, funding applications and implementation of a sustainable storm water rate. The first two options do not provide a sustainable approach to managing the City’s infrastructure needs. A stormwater rate would address pressing issues related to Victoria Park Lake remediation and upstream stormwater management improvements, enabling the City to better protect the environment. RECOMMENDATION: That the revised implementation plan for preferred alternatives in accordance with the Victoria Park Lake Class Environmental Assessment Study Report, be included in the ten (10) year capital forecast starting in 2011, pending the approval of a new sustainable funding source to achieve this increased service level. 2010-01-07 4 of 4 ïì ó ë