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HomeMy WebLinkAboutFin & Corp Svcs - 2010-01-11FINANCE AND CORPORATE SERVICES COMMITTEE The Finance and Corporate Services Committee met this date commencing at 1:33 p. m. Present: Councillor J. Smola -Vice-Chair Mayor C. Zehr and Councillors B. Vrbanovic, G. Lorentz, J. Gazzola, K. Galloway and C. Weylie. Staff: C. Ladd, Chief Administrative Officer D. Chapman, General Manager, Financial Services & City Treasurer T. Speck, General Manager, Corporate Services J. Willmer, Interim General Manager, Development & Technical Services P. Houston, General Manager, Community Services R. Regier, Executive Director, Economic Development M . May, Director, Communications /Marketing G . Murphy, Director of Engineering M . Hildebrand, Director, Community Programs R. Upfold, Director of Accounting H. Gross, Director, Project Administration & Economic Investment L. MacDonald, Director, Legal Services & City Solicitor S. Adams, Director, Community & Corporate Planning R. Gosse, Director, Legislated Services & City Clerk J. Witmer, Director of Operations C. Fletcher, Director, Facilities Management R. LeBrun, Manager, Financial Planning & Reporting G. Hummel, Manager of Parking Planning, Development and Operations P. Harris, Manager of Licensing S. Allen, Manager, Engineering Design &Approvals I. Pregel, Manager, Cultural Development C. Bluhm, Manager, Downtown Community Development J. Murphy, Customer Service Project Manager J. MacDonald, Economic Development Technical Analyst C. Musselman, Senior Environmental Planner T. Ruggle, Chief Fire Prevention Officer K. Steiss, Inclusion Co-ordinator C. Goodeve, Committee Administrator J. Billett, Committee Administrator CSD-10-004 -APPOINTMENTS -GRAND RIVER ACCESSIBILITY ADVISORY COMMITTEE The Committee considered Community Services Department report CSD-10-004, dated December 16, 2009 regarding an appointment to the Grand River Accessibility Advisory Committee (GRAAC). On motion by Councillor K. Galloway - itwas resolved: "That the following applicant be re-appointed to the Grand River Accessibility Advisory Committee (GRAAC) for a three (3) year term pending ratification by the participating municipalities of the City of Kitchener, Region of Waterloo, Township of Woolwich, Township of North Dumfries and the Township of Wellesley: Gord Cummer, City of Waterloo (renewal); and further, That notwithstanding the Terms of Reference for the Grand River Accessibility Advisory Committee (GRAAC), the composition for GRAAC for 2010 consist of 7 to 11 members." CSD-10-007 -DELEGATION OF CERTIFIER FOR THE ACCESSIBILITY FOR ONTARIANS WITH DISABILITIES ACT The Committee considered Community Services Department report CSD-10-007, dated December 21, 2009 regarding the delegation of Certifier under the Accessibility for Ontarians with Disabilities Act (AODA). FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 2 - CITY OF KITCHENER CSD-10-007 - DELEGATION OF CERTIFIER FOR THE ACCESSIBILITY FOR 2. ONTARIANS WITH DISABILITIES ACT (CONT’D) On motion by Councillor K. Galloway - it was resolved: “That the Chief Administrative Officer, or their designate, be authorized to act as the Certifier, for the Corporation of the City of Kitchener, and file accessibility reports as required under the Accessibility for Ontarians with Disabilities Act (AODA).” CRPS-10-001 - ENVIRONMENTAL COMMITTEE RECOMMENDATION 3. - COUNCIL POLICY I-100 (ENVIRONMENTAL COMMITTEE - TERMS OF REFERENCE The Committee considered Corporate Services Department report CRPS-10-001, dated December 18, 2009 regarding a recommendation from the Environmental Committee to repeal and replace Council Policy I-100 (Environmental Committee - Terms of Reference). On motion by Councillor K. Galloway - it was resolved: “That Council Policy I-100 (Environmental Committee - Terms of Reference) be repealed and replaced with revised Policy I-100 as attached to Corporate Services Department report CRPS-10-001.” FIN-10-002 - WSIB EXCESS INSURANCE 4. The Committee was in receipt of Financial Services Department report FIN-10-002, dated December 15, 2009 regarding the cancellation of Workplace Safety and Insurance Board (WSIB) excess insurance coverage. In response to questions regarding the accumulated deficit WSIB reserve, Mr. D. Chapman advised that the City’s Auditors have not expressed concern with the existing deficit, noting that a reserve would be developed to cover any future catastrophic claims. CAO-09-031 - CORPORATE CUSTOMER SERVICE PROJECT UPDATE 5. The Committee was in receipt of Chief Administrator’s Office report CAO-09-031, dated January 11, 2010 providing an update on the progress of the Corporate Customer Service project. Ms. J. Murphy reviewed the report and gave a presentation highlighting the various initiatives completed under Phase I of the project. She stated that implementation of Phase II has been delayed due to operational refinements, budget restrictions and the re-organization of Kitchener Utilities. She noted that staff anticipate presenting a report regarding the re- organization of Kitchener Utilities at the February 8, 2010 Finance and Corporate Services Committee meeting. In response to questions, Ms. Murphy clarified that the variance between the 2008 and 2009 call volume statistics reported for the Corporate Contact Centre (CCC) is partly due to when the various Divisions’ general telephone lines merged into the CCC. She advised that the intention of Phase I was to have the Contact Centre operate for a year and then adjust the model based on what went well and what needed to be improved upon. She stated that while the CCC has been working well and exceeded expectations with approximately 70% of all calls being resolved by CCC staff, a thorough review of the last six months shows that there are elements of this model that need to be addressed. The CCC was based on a combined dispatch centre and corporate contact centre model; however, it is clear that this is not serving the needs of Utilities Operations staff and that more expertise is required to fulfill regulatory requirements as municipal owners of a natural gas distribution centre. She outlined the following as some of the improvements being explored: possible separation of dispatch and contact centre functions; improved use of technology, particularly Active Customer Response (ACR) system; increased training; and, call quality monitoring. She noted that once improvements to Phase I are complete, work will commence toward initiating Phase II. FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 3 - CITY OF KITCHENER CAO-09-031 - CORPORATE CUSTOMER SERVICE PROJECT UPDATE (CONT’D) 5. Councillor J. Gazzola inquired into the number of people who continued to initially approach the City Hall security desk as opposed to the Welcome Centre, and was advised that this was approximately 60% of visitors. Ms. Murphy noted that it is not the role of security staff to act as a focal point for citizens visiting City Hall; however not realizing this, some visitors have complained that security staff were focused on their television monitors and did not immediately respond to their request for directions. She agreed to further examine the complaints received from people who initially approached the security desk. Councillor C. Weylie questioned why the call volume numbers for gas emergencies have almost doubled since last year. Mr. D. Chapman agreed to look into this matter and include a response as part of the Kitchener Utilities re-organization report scheduled to come forward in February 2010. On motion by Councillor J. Gazzola - it was resolved: “That Chief Administrator’s Office report CAO-09-031, providing an update on the Corporate Customer Service project, be received for information.” CAO-10-001 - COMPASS KITCHENER - PUBLIC SURVEY - FINAL REPORT 6. The Committee was in receipt of Chief Administrator’s Office report CAO-10-001, dated January 4, 2010 providing the results of a survey conducted by Environics Research Group Ltd. at the request of Compass Kitchener to measure residents’ satisfaction with municipal services and confirm public support for the City’s strategic direction. In addition, the Committee was in receipt this date of a chart ranking the level of satisfaction and spending support for items categorized under the following headings: fix these problems, priorities for further investment, low priority for further action, and maintain within existing resources. Messrs. Theron Kramer, Compass Kitchener and Barry Watson, Environics Research Group Ltd. presented the results of the survey, which was completed by 896 residents and has an approximate margin of error of plus or minus 3.3%. Mr. Watson advised that overall residents are pleased with Kitchener’s direction and are satisfied with the City’s government and its services. He added that residents continue to be supportive of the same six community priorities identified in 2006, with the top three being: managing growth, improving quality of life and protecting the environment. In response to questions, Mr. Watson advised that the sample size for this survey matches the Statistics Canada profile of key variables and can be considered representative of Kitchener’s population. He added that while the overall response rate was only 19%, the margin of error indicates a 95% confidence level in the survey’s results. He noted that people were asked a series of standardized questions, which were designed to be neutral in nature and not lead them to a desired answer. He commented that Kitchener’s results are positive compared to similar surveys he’s conducted. Concerning the 20 year outlook portion of the survey identifying that a majority of respondents prefer a small city versus a large city, he advised that people want a combination of both. He added that they want the character that can be found in a small city, while receiving the benefits associated with a large city. Councillor B. Vrbanovic entered the meeting at this time. CRPS-10-004 - PUBLIC MEETING - REPEAL AND REPLACE CHAPTER 508 OF 7. MUNICIPAL CODE - ALTERNATIVE MASSAGE CENTRE The Committee considered Corporate Services Department report CRPS-10-004, dated January 4, 2010 recommending the repeal and replacement of Kitchener Municipal Code Chapter 508 (Alternative Massage Centres). Ms. P. Harris reviewed the report. In response to questions, Ms. Harris advised that a public notice was placed in The Record on January 4, 2010 regarding the proposed by-law and all Alternative Massage Centres currently licensed were informed of this meeting. She stated that staff received a few inquires regarding FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 4 - CITY OF KITCHENER CRPS-10-004 - PUBLIC MEETING - REPEAL AND REPLACE CHAPTER 508 OF 7. MUNICIPAL CODE - ALTERNATIVE MASSAGE CENTRE (CONT’D) the proposed changes and overall people seemed satisfied with the proposed by-law. She confirmed that if passed, all Alternative Massage Centres would receive copies of the by-law and an overview of the approved changes. Councillor J. Smola asked if there was anyone in attendance that wished to speak to this issue and seeing none, he called the question. On motion by Mayor C. Zehr - it was resolved: “That Chapter 508 (Alternative Massage Centres) of the City of Kitchener Municipal Code be repealed and replaced based on the proposed by-law attached to Corporate Services Department report CRPS-10-004.” CRPS-10-005 - PUBLIC MEETING - REPEAL AND REPLACE CHAPTER 544 OF 8. MUNICIPAL CODE - FIREWORKS The Committee considered Corporate Services Department report CRPS-10-005, dated January 5, 2010 recommending the repeal and replacement of Kitchener Municipal Code Chapter 544 (Fireworks). Ms. P. Harris reviewed the report and advised that she received only one inquiry regarding the proposed changes and that was with regards to the licence fee. In response to questions, Officer T. Ruggle advised that changes to the by-law would allow the City to meet the requirements prescribed for under the Federal Explosives Act for the safe storage and sale of fireworks. He stated that he was contacted by the president of the K-W Model Rocket Association requesting that model rocket engines be exempted from the proposed by-laws. He commented that model rocket engines are low risk and he would consent to removing them from the by-law. Councillor J. Smola asked if there was anyone in attendance that wished to speak to this issue and seeing none, he called the question. On motion by Councillor B. Vrbanovic - it was resolved: “That Chapter 544 (Fireworks) of the City of Kitchener Municipal Code be repealed and replaced based on the proposed by-law attached to Corporate Services Department report CRPS-10-005; and further, That Chapter 501 (Business Licence Fees) be amended accordingly.” CRPS-10-002 - LICENSING OF ICE CREAM TRUCKS 9. The Committee considered Corporate Services Department report CRPS-10-002, dated December 23, 2009 regarding the issuance of a license to operate a motorized ice cream vending vehicle. Ms. P. Harris reviewed the report. Mayor C. Zehr inquired if the individual who requested that the City amend Kitchener Municipal Code Chapter 586 (Refreshment Vehicles) was notified of this report. Mr. R. Gosse advised that the individual was not notified of this meeting as staff are seeking direction on whether they should prepare a draft by-law to permit the licensing of motorized ice cream vendors. He commented that if such direction were given, then staff would notify the subject individual as well as providing public notice of when Council would be considering the proposed by-law. In response to questions, Ms. Harris advised that staff conducted a survey of ten municipalities with populations ranging from 93,000 to 670,000, to collect information on their ice cream vending by-laws and any concerns with enforcement issues. She added that of those municipalities that licence ice cream trucks, most, if not all, have restrictions in place. FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 5 - CITY OF KITCHENER CRPS-10-002 - LICENSING OF ICE CREAM TRUCKS (CONT’D) 9. Mayor Zehr commented that if the City were to proceed, specific regulations should be written into the by-law to ensure the safety of children and that ice cream trucks do not become a nuisance in residential and school areas. On motion by Mayor C. Zehr - it was resolved: “That Licensing staff be directed to prepare a report and draft by-law for Council’s consideration regarding an amendment to Kitchener Municipal Code Chapter 586 (Refreshment Vehicles) to permit the licensing of motorized ice cream vendors.” FIN-10-003 - BANKING SERVICES RENEWAL AGREEMENT 10. The Committee considered Financial Services Department report FIN-10-003, dated December 15, 2009 recommending the renewal of the CIBC banking services agreement for the optional five year extension. Ms. R. Upfold reviewed the report and advised that CIBC’s proposal to the City for banking services would result in a net cost reduction of approximately $10,000. per year over a five year period. She added that CIBC’s proposed fees are considerably less than those identified in the banking survey data. Councillor J. Gazzola questioned the cost the City would incur if it changed banking service providers. Ms. Upfold advised that in 2000, when the City switched to CIBC, the conversion process took approximately five months and involved in excess of 1,000 hours of time from staff in various divisions. She noted that the conversion costs, set up fees and staff time were estimated to cost approximately $90,000. Councillor Gazzola suggested that consideration of this recommendation be deferred to next week’s Council meeting, and staff submit a report at that time providing additional information on the estimated conversion costs. On motion by Councillor J. Gazzola - it was resolved: be referred to the January 18, “That consideration of the following recommendation 2010 Council meeting pending receipt of additional information from staff: ‘That the option to extend the City of Kitchener’s banking services agreement with CIBC be exercised for a period of five years from September 1, 2010 to August 31, 2015; and further, That the Mayor and Clerk be authorized to execute the necessary agreements with CIBC to effect the renewal, subject to the satisfaction of the City Solicitor.’” CRPS-09-157 - AMENDMENT TO CHAPTER 530 (DOGS) OF THE MUNICIPAL CODE 11. The Committee considered Corporate Services Department report CRPS-09-157, dated December 17, 2009 regarding amendments to Kitchener Municipal Code Chapter 530 (Dogs). On motion by Councillor B. Vrbanovic - it was resolved: “That the draft by-law attached to Corporate Services Department report CRPS-09-157 be enacted to amend Chapter 530 (Dogs) of the City of Kitchener Municipal Code.” FIN-10-005 - FEDERAL COMMUNITY ADJUSTMENT FUND - INTAKE 2 APPLICATION 12. The Committee considered Financial Services Department report FIN-10-005, dated January 6, 2010 recommending the submission of applications for three projects for consideration under the Federal Community Adjustment (CAF) Fund Intake 2. FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 6 - CITY OF KITCHENER FIN-10-005 - FEDERAL COMMUNITY ADJUSTMENT FUND - INTAKE 2 APPLICATION 12. (CONT’D) Mr. D. Chapman reviewed the report and advised that on December 15, 2009, as part of the Economic Stimulus plan, the Federal Government launched CAF Fund Intake 2; which is intended to provide support for municipal infrastructure projects. He stated that some of the key components for funding projects under this program are the ability to start quickly and be completed by March 31, 2011. He stated that a business plan must be submitted in support of each application and are required to be into the Province by January 18, 2010. He noted that if approved, the City would be responsible for a 10% share of the total costs of each eligible project. Mr. R. Regier and Ms. I Pregel provided an overview of the application concerning the proposed renovation of the former Legion Building at 48 Ontario Street for use as a Downtown Kitchener Community Arts Incubator. Mr. Regier advised that the building is currently vacant and requires extensive renovation to support any commercial activity. In addition, staff anticipate significant investments in the near future to insure the building does not deteriorate. Ms. Pregel stated that the proposed use as an incubation facility for the arts industry advances the City’s Economic Development Strategy and Culture Plan II, as well as aligning with documented demand studies. She added that this concept is also supported by recent prosperity council work and numerous requests to use the space from the arts community. Mr. Regier outlined that this morning he received correspondence from the Downtown Kitchener BIA concerning the lack of consultation that has taken place regarding this application. He stated that due to the limited timeframe with which to develop the application, staff were not able to formally consult with the Downtown BIA. He noted that the detailed design phase of the project will take place over the next month and staff will confer with them at that time. Councillor B. Vrbanovic expressed concerns with the application for the proposed renovation of the Legion Building, noting the unexpected nature of this project. He questioned the impact this project could have on the future redevelopment of the Centre Block lands and inquired into whether the Legion Building was listed on the City’s Heritage Register. Mr. Regier advised that no strategy is in place at this time concerning the future use of the City-owned assets in the downtown. It was noted that a report was brought forward in 2005 concerning the historic nature of the former Legion Building and it was agreed at that time to not add the building to the Heritage Register. Councillor Vrbanovic expressed apprehension as to whether this was an ideal location for an arts and culture incubator, given the civic district being previously identified for use as an arts cluster. Mr. Regier stated that it is his understanding that the properties on the civic district are in need of substantial infrastructure work, which is estimated to cost between $12 to $18M. He stated that commercial rents are rising in the face of increased demand and decreasing vacancy in both Uptown Waterloo and Downtown Kitchener. Accordingly, the arts community is at risk of loosing critical anchor presence in the downtown if long-term accommodations are not secured. Several members questioned if other projects in the Capital Forecast, such as the Victoria Park Lake Class Environmental Assessment (EA) Study, or the renovations to the Rockway Seniors Centre would qualify for CAF funding. Mr. Chapman advised that staff constructed a comprehensive list of potential projects, from which these three were selected as being potentially eligible for funding. He added that it is uncertain whether the design aspects of the Victoria Park Lake EA could be completed within the required timeframe. Mr. Hildebrand stated that the provision of seniors programming would not meet the criteria for CAF funding. Councillor J. Gazzola inquired into the current structural condition of the former Legion Building and was advised that the building is currently secured and is inspected regularly. Ms. C. Fletcher added that funding is currently allocated in the Capital Budget to replace the building’s roof. Mayor C. Zehr noted that any recommendation arising from the Committee regarding this matter was to be considered at the special Council meeting to be held later this same date. However, given the concerns expressed by various members as well as the submission deadline, he suggested that consideration of the application to renovate the former Legion FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 7 - CITY OF KITCHENER FIN-10-005 - FEDERAL COMMUNITY ADJUSTMENT FUND - INTAKE 2 APPLICATION 12. (CONT’D) Building, be deferred to a Special Council meeting to be held prior to noon on January 18, 2010. He commented that this would allow time for staff to provide additional information on the Legion Building project and to re-examine the Capital Forecast to determine if there are any other project that may qualify for this funding. In response to questions regarding the application proposing the re-development of Woodside Park, Mr. Hildebrand advised that staff would be seeking CAF funding to add two synthetic turf sport fields. Mr. G. Hummel further advised that other parks were considered; however, Woodside Park was identified as being the preferred location. He added that it is expected that operating revenues for the Park would increase due to the increased bookable hours for each of the fields. Ms. P. Houston noted that there is an allocation for artificial turf in the Capital Forecast in 2019. Councillor Gazzola requested clarification as to what would be undertaken in relation to the application for the King Street Master Plan and Civic Square Renovation project. Mr. C. Bluhm advised that if approved the CAF funding would allow for the incorporation of works previously scoped out of the King Street Master Plan. On motion by Mayor C. Zehr - it was resolved: “That consideration of submitting an application to the Federal Community Adjustment be Fund Intake 2 regarding the proposed renovation of 48 Ontario Street ($3.0 million) deferred to a Special Council meeting to be held prior to noon on January 18, 2010 , to allow time for staff to provide additional information; and, That staff be directed to submit applications for the following two projects, in order of priority, for consideration under the Federal Community Adjustment Fund Intake 2: 1. Redevelopment of Woodside Park ($1.6 million); 2. King Street Master Plan and Civic Square Renovation ($0.75 million); and, That for projects approved under the Federal Community Adjustment Fund, the City of Kitchener fund at least 10% of the total eligible project costs; and further, That the General Manager of Financial Services be authorized to sign the applications for these projects.” Councillor B. Vrbanovic assumed the Chair at this time. PRESENTATION - REQUEST TO HAVE QUESTION PLACED ON 2010 MUNICIPAL 13. ELECTION BALLOT Mr. Iain Klugman gave a presentation on behalf of a group of local citizens urging the councils of Kitchener and Waterloo to ask the Minister of Municipal Affairs and Housing to place the following question on the ballot of the 2010 Municipal Election: “Would you support members of council engaging in a dialogue about the merits of merging the cities of Kitchener and Waterloo? Yes or No.” Mr. Klugman stated that by making this request of the Province it provides an opportunity for these two communities to engage in a discussion regarding this issue and creates the environment required for effective dialogue and debate. He noted that Kitchener and Waterloo need the Minister to place this question on the ballot as municipal mergers are the sole jurisdiction of the Provincial Government. In response to questions, Mr. Klugman advised that his group is neither for nor against merging the two cities and simply wants to create an environment for debate through posing a direct question to the people of both cities. He noted that unlike previous attempts at FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 8 - CITY OF KITCHENER PRESENTATION - REQUEST TO HAVE QUESTION PLACED ON 2010 MUNICIPAL 13. ELECTION BALLOT (CONT’D) amalgamation, this focuses solely on the cities of Kitchener and Waterloo. He clarified that the members of his group live and work in both cities and represent various facets of the community. Mr. R. Gosse advised that the results of a question placed on a ballot by the Minister are not binding on a municipality. He noted that pursuant to the Municipal Elections Act, the Ministry is responsible for covering the costs of giving notice for questions they place on the ballot. Several members spoke in support of providing an opportunity for a discussion to take place between the two cities regarding the possibility of a merger. It was stressed that by making this request of the Minister, all it is doing is providing an opportunity for citizens to have a dialogue about their beliefs and their desired direction on this issue. Councillor J. Gazzola advised that when the issue of amalgamation was previously discussed, he made a motion seeking information from the Province about the benefits and costs associated with the merger of other cities; however, that information was never provided. He stated that he would not support the delegation’s request, noting that this is not a burning issue that needs to be pursued at this time. Carried The following motion was voted on and , on a recorded voted, with Mayor C. Zehr and Councillors G. Lorentz, J. Smola, K. Galloway, B. Vrbanovic and C. Weylie voting in favour and Councillor J. Gazzola voting in opposition. On motion by Mayor C. Zehr - it was resolved: “That the Minister of Municipal Affairs and Housing be requested to make an order requiring the Clerk to submit the following question to the electors for the 2010 City of Kitchener Municipal Election: ‘Would you support members of council engaging in a dialogue about the merits of merging the cities of Kitchener and Waterloo? Yes or No.’” The Committee then recessed at 4:52 p.m. and reconvened at 7:05 p.m. for the purpose of public consultation on the 2010 budget, as Chaired by Councillor B. Vrbanovic, and with the following members present: Mayor C. Zehr and Councillors J. Gazzola, G. Lorentz, J. Smola, K. Galloway and C. Weylie. FIN-10-004 - 2010 BUDGET - GENERAL OVERVIEW 14. The Committee considered Financial Services Department report FIN-10-004, dated January 4, 2010 which provides an overview of the draft 2010 operating and capital budgets. Mr. D. Chapman presented an overview, including national and local economic trends; impact of economic downturn on the Corporation; staff’s approach to striking a balanced budget; and mitigating measures taken in response to the challenge of economic downturn, including $2.5M in reductions to the 2009 base budget. The budget guideline as set by Council was 1.79% for general property tax and 1.2% to fund the Economic Development Investment Fund (EDIF). Mr. Chapman advised that the proposed tax levy is currently at 1.83% before EDIF and 3% with EDIF included, and staff is continuing to work to identify further efficiencies and reductions, which if approved will bring the tax levy below 3%. It was also noted that effective 33 March 1, 2010, water rates are proposed at $1.5271 per m and sewer rates at $1.7295 m, together with a flat rate of $432.38 to be charged to “sewer only” customers. The rates represent a combined rate increase of 8.5% in 2010 which is based on the Region of Waterloo rate increase and is consistent with other local municipalities. A comparison of typical residential property taxes was provided which compares 2009 property taxes among th municipalities with populations greater than 100,000. Kitchener is ranked 6 lowest with an average $2,737. per household in comparison to the average median of $3,206. The comparison also ranks Kitchener in the middle range between Waterloo and Cambridge in FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 9 - CITY OF KITCHENER FIN-10-004 - 2010 BUDGET - GENERAL OVERVIEW (CONT’D) 14. respect to average household costs. Results of an Environics Citizen Survey conducted in November-December 2009 were shared which indicates overall citizen satisfaction with + municipal government and services (80%). Mr. Chapman concluded that the City’s operating budget strikes a balance between limiting impact to public services, management of long term organizational impact of budget cuts and maintaining a reasonable property tax increase for 2010, without compromising financial stability. Final consideration of the 2010 Budget will take place at the January 18, 2010 special Finance and Corporate Services Committee meeting commencing at 9:00 a.m. DTS-10-015 - VICTORIA PARK LAKE - IMPLEMENTATION CLASS EA STUDY 15. The Committee considered Development and Technical Services Department report DTS-10- 015, dated January 4, 2010, together with 2010 Budget Issue Paper #44, concerning implementation of the Victoria Park Lake Class Environmental Assessment (EA) Study recommendations. Mr. G. Murphy advised that in November 2009 Council directed staff to develop an implementation plan to expedite phasing of the preferred alternative, which includes dredging and deepening of the lake and implementation of upstream storm water management systems. He noted that the Issue Paper attached to report DTS-10-015 outlines a proposed phasing of implementation and funding options, which is to be considered during budget deliberations on January 18, 2010. The proposed phasing provides for an earlier commencement of the project, with the detailed design of the lake components to be done in 2011, construction of Phase 1 to begin in 2012 and completion of all phases of the project by 2015. It was noted that the 10 Year Capital Forecast is fully committed to other higher priority infrastructure renewal projects and this project can only be included if new funds are found. The estimated cost of the project is $16M and 3 funding options were provided, including: re-prioritization of capital projects; pursuit of senior government funding applications; and establishment of a sustainable storm water rate. Staff is recommending the third option to establish a dedicated storm water rate structure to provide sustainable funding for storm water management programs City-wide, including Victoria Park lake. Councillor J. Gazzola requested clarification of the increase in the cost estimate for Victoria Park lake from $9.5M in the EA study to $16M. Mr. Murphy advised that the total cost estimate is a range from $10 to $16M, and is based on recent significant increases seen in construction costs as funded under the Infrastructure Stimulus Program and the Community Adjustment Fund due to competition for labour and materials. He noted that as the detailed design phase proceeds more definitive information on costs will become available. Councillor Gazzola inquired as to what portion of the project is to be funded from Development Charges (DC). Mr. Murphy advised that approximately $1.4M has been set aside in the DC Background Study. He added that the growth related portion of this project is based on future development and the $1.4M is deemed to be reasonable in respect to impending new levels of development upstream. Councillor Gazzola inquired as to the amount allocated to road resurfacing annually and Mr. Murphy advised that $3 to $3.5M is allocated annually. Councillor Gazzola questioned the feasibility of diverting some of this funding to the Victoria Park lake project. Mr. Murphy advised that a decision to do so would be at the discretion of Council. Councillor C. Weylie requested clarification as to the reason this project was not included for consideration under the Federal Community Adjustment Fund (CAF), Intake 2 Applications discussed earlier this date. Mr. Murphy advised that projects under the fund are required to be completed by March 31, 2011 which is not realistic given this is considered to be a 5 year project and it also has to be completed in conjunction with other current projects. He added that the dredging operation alone ranges from $5 to $7M which he believed would exceed what might be provided under the senior government funding. Councillor Weylie questioned the feasibility of making application for only the forebay construction and deepening of the lake components, estimated between $1.4 to $2.8M. Mr. Murphy advised that if directed staff could investigate this option. Mayor C. Zehr questioned how confident staff is in respect to the proposed timelines for completion of the project in 2015. Mr. Murphy advised that staff consider the original schedule FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 10 - CITY OF KITCHENER DTS-10-015 - VICTORIA PARK LAKE - IMPLEMENTATION CLASS EA STUDY (CONT’D) 15. outlined in the EA study in respect to duration of the project to be appropriate and anticipate that if the phasing plan is approved, tendering can proceed in the fall of 2011 with construction to begin in 2012. He added that should concerns arise in respect to completing the project within the 5 year timeframe there may be opportunity to extend works related to the upstream storm water management systems, a decision of which would be made by the Council of the day. Mayor Zehr inquired as to the greatest risk in not achieving the proposed timeline. Mr. Murphy expressed the opinion the greatest risk is in not having available funding and/or resources to complete the project, which staff is attempting to address in proposing establishment of a storm water rate structure. He added that in respect to construction, there will be risk in respect to the volume and type of sediments to be removed and the cost of its disposal. Councillor Gazzola inquired as to the cost of the detailed design. Mr. Murphy advised that typically the cost correlates to 10-15% of the total project cost, which in this instance assuming 10% of the estimated range of $10 to $16M would equate to approximately $1 to $2M. Councillor Gazzola inquired if monies to be received under applications to the CAF could be used to start the design phase. Mr. D. Chapman advised that it was his understanding design is not an eligible component under this program but rather the focus is on physical construction components. Mr. Chapman agreed to undertake to confirm the program’s eligibility criteria. Councillor Gazzola questioned the time required to complete the design detail and Mr. Murphy advised that if commenced now, a tender could conceivably proceed in September-October 2010. Councillor Gazzola inquired as to the feasibility of proceeding with the forebay construction firstly as proposed by Councillor Weylie. Mr. Murphy advised that in terms of timing it could be realistic; however, he pointed out that it is not just a matter of funding but is also a staffing resource issue. He pointed out that if commenced earlier, staff would have to be reallocated from other projects they have already been committed to and which are either currently underway or in the design phase. Councillor Vrbanovic added that it is uncertain at this time if the design component would be eligible for the Federal funding and a decision to pursue this would be pending confirmation from staff as to the program eligibility criteria. DTS-10-016 - STORM WATER UTILITY AND RATE IMPLEMENTATION 16. The Committee considered Development and Technical Services Department report DTS-10- 016, dated January 4, 2010 recommending establishment of a storm water utility and rate structure to provide sustainable funding for the City’s storm water management programming and which could be used to fund the Victoria Park Lake project in an earlier timeframe. Development and Technical Services Department report DTS-09-042, dated September 25, 2009, previously considered on October 5, 2009, was also attached to report DTS-10-016 for the Committee’s information. The latter report dealt with receipt of findings from the Kitchener- Waterloo Storm Water Management Program and Funding Review, the results of which identified the need for a sustainable funding source for storm water management programming. Mr. Murphy advised that as previously presented, the proposed rate structure would be used to address storm water management programming needs City-wide, including Victoria Park Lake. He commented that the current service level for the SWM program budget is $5.8M which does not include the remediation and upstream SWM works for Victoria Park Lake. Staff is recommending that the sustainable level of service be increased from $5.8M to $9.9M, supported by establishment of a storm water rate structure beginning in 2011. A tiered flat fee structure is recommended, consisting of 4 tiers (single family, multi-family, non-residential and tax exempt non-residential). The fee would apply to a property owner served by a local water utility through a water meter and be based on land parcel usage. Currently 59% of the sustainable service level is already being funded from the tax base ($5.46 / month for single family) and the proposed increase in service level would equate to approximately $3. per month for an average residential property owner ($7.92 / month). The fee will also apply to tax exempt properties amounting to approximately $979. annually for each property. If approved, the shift to a rate structure will result in an average annual tax levy savings of $5.8M or equivalent to a one time reduction in the tax levy of 6.24% and will provide adequate funding to accommodate the Victoria Park lake project in a more timely manner. FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 11 - CITY OF KITCHENER DTS-10-016 - STORM WATER UTILITY AND RATE IMPLEMENTATION (CONT’D) 16. Mr. Murphy advised that if approved, work would commence on development of the storm water utility implementation program and would include consultation with School Boards, places of worship and other tax exempt property owners. He added that following consultation, a report will come forward in May 2010 outlining a rate structure to implement the 10 Year Operating and Capital Forecast; and a rate implementation phase-in period to deliver a sustainable level of service for storm water management. Mr. Murphy advised that the recommendations as set out in report DTS-10-016 are to be considered as part of the budget deliberations on January 18, 2010. Councillor J. Gazzola requested clarification of the proposed increase from $5.8 to $9.9M. Mr. Murphy responded that the SWM study proposes a phase-in in the level of service to achieve sustainable funding for capital improvement projects, including Victoria Park Lake; operation and maintenance for swm ponds and oil/grit separators; and future south-end development. Mr. Murphy noted that more detail as to the proposed increase is outlined in the SWM study document and agreed to provide same to Council. Councillor Gazzola expressed concerns with linking the Victoria Park lake project to the proposed storm water utility and rate structure, suggesting that the lake project should be dealt with outside of this proposal. He questioned what impact development charges would have. Mr. Murphy responded that if the principle of shifting the storm water program from a property tax supported program to a user rate funded program is approved, the level of financial detail requested would be provided in the subsequent report to be presented in May 2010 and would include a complete capital and operating budget for the storm water utility. Mr. J. Willmer commented that two reports as previously considered by Council in 2009 on the issue of the storm water management review had nothing to do at that time with Victoria Park lake. He noted that those reports included an audit that clearly indicates the current level of service City-wide is inadequate and water quality is suffering; a matter which is taken seriously by the City and which demonstrates a need to increase the level of funding to achieve a sustainable level of service, regardless of Victoria Park lake. Councillor Gazzola questioned if the HST will apply to the storm water rate and Mr. Chapman advised that it is not likely to apply as it is currently not subject to GST. Councillor Gazzola questioned why the single family rate would not remain constant given non-residential properties will pay substantially more. Mr. Murphy advised that when the actual rate structure is developed one of the driving principles will be to ensure the shift in rates is appropriate to the property type and it is intended that those properties having greater impact on storm water management systems would be charged a higher rate. He noted that if no increase in single family properties occurs, any shortfall in achieving the sustainable level of service would shift to non-residential properties whereas the intent is to establish a fair and equitable rate structure. Councillor Gazzola questioned the feasibility of deriving a rate based on the uniqueness of each individual property. Mr. Murphy commented that this would be difficult to administer, noting that it took some time during the study to do sample assessments on which the rate estimates were based. Councillor Gazzola questioned if water run-off from roofs that fall into a backyard would be included. Mr. Murphy advised that the intent is not to measure water run-off but rather assess the impervious surface areas of a property, on the basis that the greater the hard surface on a property the less opportunity there is for water to drain into soil. Mayor C. Zehr commented that he was pleased to see confirmation in the report that consultation will be undertaken with School Boards, places of worship and other tax exempt property owners prior to consideration of the report to come forward in May 2010. He advised that he had also made personal commitment to these groups to have consultation on the matter. Councillor K. Galloway requested clarification if this is a new charge, or transfer of existing charges out of the tax levy into a user rate. Mr. Murphy advised that if approved, it will be a shift from the tax base to a rate base, with the current $5.8M to be transferred into the rate base plus the proposed increase in storm water rates to achieve the sustainable level of service. Councillor Galloway questioned the impact of not approving the increase. Mr. Murphy FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 12 - CITY OF KITCHENER DTS-10-016 - STORM WATER UTILITY AND RATE IMPLEMENTATION (CONT’D) 16. advised that if the rate structure concept is approved without the rate increase, then the current level of service funds would be transferred to the rate base. He stated that without the increase included the City will be faced with re-prioritizing current projects and how then to address Victoria Park lake. Councillor Galloway questioned what would be required to achieve a sustainable level without a user rate. Mr. Murphy advised that approximately 5% annually would be needed. DELEGATIONS - ITEM NOS. 15 AND 16 17. Messrs. Rych Mills and Bob Sharpe attended on behalf of the Victoria Park Working Group, concerning implementation of the Victoria Park lake EA study recommendations. Mr. Mills advised that the Working Group hosted a public meeting on January 5, 2010 attended by approximately 90 interested participants and at which time Budget Issue Paper #44 was reviewed. He advised that it was evident there is unanimous support for the Victoria Park lake to be addressed in an earlier timeframe and to be a priority to the City as outlined in the issue paper. Mr. Sharpe commented that while the Working Group unanimously supports the earlier timeframe as proposed, they do have concerns with the options for financing, and posed the following questions: can a mix of the three financing options be considered aspresented in Budget Issue Paper #44, and are these the only three options possible under the Engineering Services budget envelope? can other financing optionsfrom across the various other budget envelopes be considered? Mr. Sharpe advised that the Group also has concerns with linking the EA study to the storm water rate proposal in that, if not approved there will be no dollars allocated to the Victoria Park Lake project; and if approved, it is not certain that the timeline to implement will match that of the EA. He added that there is concern citizens will view the rate proposal as a new tax specific to Victoria Park lake which may diminish support for the project and obscure the need for this work to be done regardless of how financed. Mr. Sharpe then put forward a question concerning the rationale behind staff’s change in support of a tiered single family unit to recommending a tiered flat rate. He commented that the flat rate is less equitable in that it does not correlate to water run-off from each property and limits ability to take advantage of incentives geared to reducing storm water run-off. In regard to the delay in implementation to 2011, Mr. Sharpe asked if the current Council would commit sufficient funding in 2010 to begin the design phase of the project now to demonstrate to citizens that regardless of what happens with the storm water management program, cleaning up Victoria Park Lake will remain a top priority for the City of Kitchener. Mr. Sharpe suggested that if not addressed, all of the issues raised will place implementation of the EA in jeopardy and asked that the questions posed be responded to in writing prior to the January 18, 2010 budget deliberations. Mayor C. Zehr commented that while future Councils have the right to change direction, it was his opinion continued citizen interest in this matter would make a change in direction difficult for a new Council. He added that problems associated with Victoria Park lake will remain in any event and a new Council will have the same responsibilities to deal with the issue. Mayor Zehr also noted that this project was put forward as the City’s number one priority for Infrastructure Stimulus funding and while not chosen by the senior governments, this Council is committed to addressing the issue. Mayor Zehr asked what the delegation might propose in respect to use of other budget envelopes. Mr. Sharpe referred to the list of capital projects in the 10 Year Capital Forecast, suggesting that consideration be given to a re-prioritization and/or modified phasing of the works proposed. Councillor Gazzola requested clarification of the issue raised concerning the recommended tiered flat rate. Mr. Murphy advised that the single family unit rate considers the amount of impervious area for each property, a sampling of which was taken during the study and rate FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 13 - CITY OF KITCHENER DELEGATIONS - ITEM NOS. 15 AND 16 (CONT’D) 17. estimates established were pro-rated against the current level of service. Staff is recommending the tiered flat surface rate as it is much simpler to implement, with the intent to provide a method that will enable Council to move forward with a funding mechanism for Victoria Park lake in an earlier timeframe. Councillor B. Vrbanovic requested staff comment in regard to the question of using a mix of the financing options. Mr. Chapman advised that staff would look to Council for direction on January 18 in this regard, noting that staff have already faced difficulty in Council’s previous direction to increase the level of funding for parks and open space and if requested to do so here, will be faced with an even greater challenge. Mr. Murphy added that a decision would have to be made in respect to what other projects would not proceed and the associated impact, advising that he would not support proceeding in this manner but would support the proposal to commence in 2011. Mr. D. Chapman suggested in regard to concerns raised respecting a new Council, that this Council could direct to amend the 10 Year Capital Forecast to build in the Victoria Park Lake project so it is before future Councils as part of the capital budget process. Ms. Anna Maste, Victoria Park Neighbourhood Association, advised that the Association is in support of an earlier timeline for the Victoria Park Lake project. She commented on the importance of the park to area residents, the community and beyond Kitchener’s borders, raising concerns that failure to address this issue in a timely manner would have detrimental environmental impacts and negate improvements already completed in an effort to revitalize the downtown. Ms. Maste presented a petition of more than 400 signatures on behalf of Marilyn McCarl, resident and originator of the petition, in support of making Victoria Park Lake a priority. She asked that Council also undertake to ensure the proposed funding mechanism not become known as a Victoria Park tax as it is in actual fact a method to fund City-wide storm water management programming. Ms. Ginnie Quinn, resident, spoke in support of the proposed earlier timeframe but suggested that many would still like to see the project start this year. She proposed that senior governments be lobbied and that perhaps this project would qualify under the City’s LEAF program. Ms. Quinn stated that with the recent improvements to the downtown streetscape and park entrance, together with proposed residential development in the downtown, now would be an appropriate time for Victoria Park lake to take high priority. Ms. Yvonne Fernandes, resident, offered the following suggestions in regard to other funding sources: delay of that portion of the Strasburg Creek Rehabilitation project related to design work for Wards Pond; citizen pursuit of a Community Environmental Grant; reduction in costs associated with the Goodrich Drive site; use of park trust fund monies collected from developers in lieu of greenspace; and pursuit of heritage funds given Victoria Park is a Heritage Conservation District. Ms. Louisette Lanteigne spoke in support of the proposed storm water utility and rate structure, commenting on the need to protect water quality and quantity in view of climate change and growth related development. She suggested that the City pursue Federal / Provincial / Regional funding, consider rebates under the HST and consider a surcharge on new development. RECOMMENDATION - ITEM NOS. 15 AND 16 18. On motion by Mayor C. Zehr - it was resolved: “That the staff recommendations contained in Development and Technical Services Department reports DTS-10-015 (Victoria Park Lake - Implementation of Class EA Study) and DTS-10-016 (Stormwater Utility and Rate Implementation), both dated be deferred to the January 18, 2010 special Finance and January 4, 2010, Corporate Services Committee meeting to be considered in conjunction with the Victoria Park Lake Issue Paper #44, as attached to report DTS-10-015, and in the overall context of the 2010 Budget.” FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 14 - CITY OF KITCHENER CAO-09-059 - ECONOMIC DEVELOPMENT INVESTMENT FUND - UPDATE 19. The Committee considered Chief Administrator’s Office report CAO-09-059, dated December 22, 2009 concerning a 5 Year Review of the Economic Development Investment Fund (EDIF). Mr. R. Regier advised that the objectives of EDIF was to stimulate assessment growth, employment and development of residential units in the Downtown; maximize contributions in addition to City funding for each project with a target of securing 15% overall from other partners; and achieve a return on investment, both direct and indirect. He noted challenges in evaluating the effects of EDIF at this time, including time lag in some indicators such as updated assessment and census information. Notwithstanding, current data provides insight into some aspects of the effect of EDIF and ability to draw some conclusions as to its future impact over time. A chart was provided demonstrating that EDIF is beginning to stimulate assessment and tax revenue growth, resulting from development of the Shirley Drive employment lands; School of Pharmacy; a decline in office vacancies; and other projects in the development process, as wells as future residential growth in the downtown. It was noted that from 2004 to 2006, City- wide assessed values grew approximately 18%, the downtown control group by about 17% and EDIF residential investment by only 8%; however, in each subsequent year the cumulative growth for the EDIF group was higher than both the City-wide and downtown control group, indicating that EDIF has had significant positive impact on downtown assessment. A table demonstrating employment growth was provided, showing 239 positions directly attributable to EDIF investments, and overall, downtown employment has increased by 16% at double the rate of the Regional labour force growth. Downtown office vacancy rates have steadily decreased from 13.9% in 2004 to 7.4% in 2009 and is currently lower than the City- wide average of 8.1%. Stimulation in downtown residential growth is evident by the Kaufman Loft condominium development valued at $45M and which introduced 270 new residential units, bringing approximately 486 residents to live in the downtown. The Upper Storey Renovation Program has produced six projects underway or complete, comprising 26 units and a total project cost of $1.7M, of which $489,250. was or will be loaned by the City. It was further noted that as a result of future development the City could see up to 1,700 new residential units and 3,000 new residents to the downtown and surrounding neighbourhoods over the life of EDIF (2014). A chart outlining partner investments was provided which shows partners are investing more in EDIF projects than the City and for most projects involving partner funding, the City was able to more than double the value. It was noted that the City has expended $49.2M and partner investments total $64M, representing $1.33 in additional funding per City dollar spent. Mr. Regier advised that when future investments from others and allocated investments in EDIF are added this figure will increase to $1.78 per dollar spent by the City, equating to 178% of EDIF being matched by other public and private sector investments. Mr. Regier advised that approximately 50% of EDIF has been invested and has already shown positive effects in downtown assessment growth, employment and residential development. It has created a positive momentum in the downtown, building consumer and investor confidence and benefits will continue to increase as projects mature. Mr. Regier added that staff believe the fund will also be supported by complementary initiatives underway, such as the new Provincial Courthouse, Regional Light Rail Transit (LRT) and GO Transit investments. Mr. Adrian Conrad, Chair of the Economic Development Advisory Committee (EDAC), provided comments from members of EDAC in regard to the EDIF 5 Year Review, which express satisfaction in the momentum created by EDIF and appreciation for the City’s decision to steer direction of the fund toward investment in emerging knowledge clusters. It is noted that the staff recommendation contained in report CAO-09-059 was not voted on at this time but will be advanced to the January 18, 2010 Council meeting as part of the Finance and Corporate Services Committee report for consideration by Council that date. FINANCE AND CORPORATE SERVICES COMMITTEE JANUARY 11, 2010 - 15 - CITY OF KITCHENER DELEGATION - 2010 BUDGET 20. Mr. Harley Forden, Chair, Rockway Advisory Committee, attended in regard to the proposed closure of the Rockway Senior Centre to effect a budget reduction in 2010. Mr. Forden noted that the Centre remains on the list of budget reductions despite an earlier decision of Council to defer decision on closure of the facility to March 2010. He questioned why it remains on the list and asked for it to be removed. Mayor C. Zehr advised that he had addressed this issue during discussion in December 2009 in that, he had made known that Council would still have a decision to make on January 18 from a budget perspective and until such time, the item would remain shown on the list of budget reductions because it is not yet resolved. Mr. Forden questioned that if a decision is made to close the Centre at the end of 2010 but the funding is removed on January 18, how the Centre would be able to function through 2010. Mr. D. Chapman advised that an Issue Paper would be coming forward on January 18 that would address this issue from a budget perspective. Ms. P. Houston added that if the funding is removed in 2010 and a decision is made to leave the Centre open a budget correction would have to be made in 2011; and if the decision is to close the Centre, the funding currently allocated to capital improvements for the facility would be allocated to fund the operating shortfall in 2010 to allow the Centre to function through the year prior to closing. Mr. Forden then referred to earlier reports that indicated $1.34M for capital improvements would be required if the Centre was to remain open, of which part of that cost would go to improvements required under the Accessibility for Ontarians with Disabilities Act (AODA). He raised concerns that regardless of whether the Centre remains open, or is closed, monies will be required to bring the facility into compliance with the AODA and suggested it should not be included in the capital improvement estimate as it is irrelevant to the proposed closing. Councillor B. Vrbanovic advised that if a decision was made to close the Centre, then secondary to that decision would be a decision as to what to do with the City asset. If the building is retained by the City then matters concerning AODA would have to be addressed; however, with other options such as disposal of the asset or a use other than for public purpose, this may not be the case. Mr. Forden inquired if plans for disposition of the asset are known at this time should the decision be to close the facility. Ms. P. Houston advised that if closed it is intended current programming would be reallocated to other facilities and in respect to the asset, it is assumed on closing it would not remain used for City purposes otherwise there would still be a budget issue. She noted that there would be a number of options to consider in respect to disposition of the asset, such as use by other agencies, but that this has not yet been fully explored. ADJOURNMENT 21. On motion, the meeting adjourned at 10:05 p.m. Collin Goodeve Janet Billett Committee Administrator Committee Administrator