2009/04/06 ;
CORPORATE SERVICES COMMITTEE AGENDA
FIFTH MEETING
Monday, April 6, 2009
Council Chambers - 6:00 - 7:00 p.m.
1. 2009 Budgets Staff Contact
a) General Purposes Budget Ed Dujlovic
Presentation
b) Capital Budget Ed Dujlovic
Presentation
c) Municipal Utility Budget Ken Burden
Presentation
Report: CPS-2009-02 Ken Burden
Municipal Utility Budget, Fees and Charges
for Water and Sewer
2. New Business
3. Adjournment
REMINDER: PLEASE BRING YOUR 2009
BUDGET BINDERS TO THE MEETING
April 6, 2009 CPS-2009-02
I~~~~ara~alls
~nN~~,ti
Councillor Victor Pietrangelo, Chair
and Members of the Corporate Services Committee
City of Niagara Falls, Ontario
Members:
Re: CPS-2009-02
2009 Municipal Utility Budget, Fees and Charges for Water and Sewer
RECOMMENDATION:
1) That the 2009 Municipal Utility Budget be approved,
2) That the 2009 Schedule of Fees and Charges for Water and Sewer be approved
and made effective May 1, 2009.
BACKGROUND:
The Municipal Utility Budget provides forthe revenues and expenditures ofthe City's water
and sanitary sewer systems.
2009 Municipal Utility Budget Expenditures
Regional Charqes
There are recent changes in the Region's billing for water supply. The Regional water
billing will change from a total volumetric rate to a partial fixed and partial volumetric
charge. This change resulted from a review that focussed on the shortfall of Regional
water revenues. The review determined that many of the Region's water costs are fixed,
and that a fixed charge would help offset the Region's risk of revenue shortfails. Regional
Council Reports CSD 57-2009 is attached for your information to better understand the
billing change for water supply.
Staff has reviewed the City's history of water and sewer flows and the expected Regional
billings. Compared to the 2008 estimates, Regional water billings are expected to increase
by 11.5%, and 1.8% for sewer billings. In total, the Regional charges are expected to
increase by $1.25 million.
Corporate Services Departmei
Finance
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April 6, 2009 - 2- CPS-2009-02
In 2008, the City experienced a significant shortfall in sewer consumption revenue. The
2008 year experienced significant rainfall which impacted the use of water. Since the
sewer consumption revenue is based on water usage, the City's revenues were not
sufficient to pay the Regional fixed charges for sewer treatment.
For 2009, Staff is recommending a revenue stabilization amount of $678,700. The
stabilization will help offset the risk of revenue shortfalls when paying the Region's water
and sewer billings.
Wages and Benefits
Staff has reviewed the expenditure for labour to ensure that sufficient budget is allocated
to implement the recommendation from the Environmental Services Delivery review. For
2009, staff has also included a portion of the Infrastructure Services personnel, to reflect
the dedicated use of their time for water and sewer projects. The allocation of
Infrastructure Services transfers approximately $323,000 from the General Purposes
Budget. The total increase for labour costs is approximately $485,000.
As Council will recall, the Service Delivery Review for the Water/ Waste Water section
(CAO-2008-04) recommended four union positions, to facilitate uninterrupted preventive
maintenance, and one new management position, Environmental Services Coordinator,
to plan and coordinate the staff and to monitor and maintain performance measurement
data and statistics. The increased complement was recommended to reduce the reliance
on contracted services at an estimated cost savings of more than $400,000 per year.
Debt Principle and Interest Payments
During 2009, the payments of interest and principle will be maintained at $236,300. In the
capital program, should any of the water and sanitary sewer projects require debt
financing, the servicing of the new debt would begin in 2010.
Materials and Contracted Services
The total increase for materials and contracted services are approximately $520,000. This
increase includes the additional expense ($94,900) for the billing and receipting services
provided by Niagara Peninsula Energy. Also included are increased expenditures for
asphalt patching ($145,000), engineering services ($187,500), system inspections, leak
detection, repairs and rehabilitation programs.
Rents and Financial Expenses
This expenditure includes Tenant Deposit Interest, Uncollectible Accounts, and the
Senior's $100. Rebate Program. In 2008, this account included Regional charges for debt
servicing; these fixed charges were separate from the Region's billing forwater and sewer.
For 2009, these fixed charges will not be billed separately. The costs of approximately
$289,700 have been moved from this account to the Regional Charges account.
April 6, 2009 - 3- CPS-2009-02
Capital Contribution
Capital Contribution provides funding for waterworks and sanitary sewer system
construction and maintenance. The same amount of transfers as in 2008 has been
included. The water capital contribution is $4,500,000 and the sewer capital contribution
is $4,645,000. Staff has developed the 2009 Capital Projects Budget based on a total
capital contribution of $9,145,000.
Exqenditures Summary
For 2009, the total water and sewer costs are estimated at $39,678,600, an increase of
$2,557,500 or 6.9% over the 2008 Municipal Utility Budget expenditures. Almost half of
the increase is due to Regional Charges. The remaining increase results from the new
stabilization amount, labour increases, the transfer of Infrastructure Services, and an
increase in contractual services.
The Committee may want to consider reducing certain expenditures. Suggested expense
items are the stabilization amount, the capital contribution, and contracted services. Such
reductions would have an impact on revenue security, capital projects, and annual
maintenance programs. For example, a$1,400,000 reduction in expenditures would
effectively hold a homeowner's water and sewer bill to a 5% increase over last year.
2009 Schedule of Fees and Charges for Water and Sewer
Water and Sewer Consumption Rates
The consumption rates are intended to raise sufficient revenues to pay the Regional costs
for water supply and sewer treatment. Due to the change in the Region's billing, staff has
also included a revenue stabilization amount to help offset the risk of a consumption
revenue shortfall.
For 2009, the City's water consumption rate would increase to $0.7602 per cubic metre,
and the sewer consumption rate would increase to $0.9612 per cubic metre. The following
chart shows a history of previous years' consumption rates for water, sewer, and the 2009
proposed consumption rates per cubic metre.
Water Sewer Combined Increase
Rate Rate Rate
2005 $0.5610 $0.8780 $1.4390 2.42%
2006 $0.5780 $0.8780 $1.4560 1.18%
2007 $0.6024 $0.8544 $1.4568 0.05%
2008 $0.6493 $0.8760 $1.5253 4.70%
2009 $0.7602 $0.9612 $1.7214 12.86%
April 6, 2009 - 4- CPS-2009-02
Monthly Service Charqes
The monthly service rates are intended to raise sufficient revenues to pay the City's costs
to maintain, repair and improve the water and sanitary sewer distribution systems. Both
Water and Sewer monthly service charges are calculated by dividing the total costs for
each of the distribution systems by the number of water meters. The calculation also
factors the meters according to their size, so that a larger meter has a greater monthly
charge than a smaller meter.
For 2009, the Base monthly water service charge would increase to $23.38, and the sewer
service charge would increase to $21.39. The following chart shows a history of previous
years' and the 2009 Base monthly service charges.
Water Sewer Combined Increase
Rate Rate Rate
2005 $20.44 $11.96 $32.40 8.62%
2006 $19.56 $13.82 $33.38 3.02%
2007 $20.07 $18.58 $38.65 15.79%
2008 $21.49 $20.41 $41.90 8.41%
2009 $23.38 $21.39 $44.77 6.90%
For comparative purposes, the following chart shows several examples of how the
proposed water and sewer rates would impact various ratepayers by meter size and
quantity of water used.
Meter Estimated Average Annual 2009 2008 Change
Size Volume of Water Consumption $ $ $ %
Estimated Annual Water and Sewer
Charges - Residential
15mm 10 cmlmonth or 120 cmlyear $ 743.86 $ 685.77 $ 58.09 8.47
15mm 15 cmlmonth or 180 cmlyear $ 847.14 $ 777.28 $ 69.86 8.99
16mm 20 cm/month or 240 cm/year $ 950.43 $ 868.80 $ 81.63 9.40
16mm 25 cm/month or 300 cm/year $ 1,053.71 $ 960.31 $ 93.40 9.73
Estimated Annual Water and Sewer
Charges - Commercial
25mm 100 cm/month or 1,200 cm/year $ 2,602.95 $ 2,333.00 $ 269.95 11.57
37mm 200 cm/month or 2,400 cm/year $ 5,743.19 $ 5,168.75 $ 574.44 11.11
50mm 360 cm/month or 4,320 cm/year $ 10,660.12 $ 9,605.39 $ 1,054.73 10.98
75mm 1,000 cm/month or 12,000 cm/year $ 27,104.05 $ 24,335.49 $ 2,768.56 11.38
100mm 2,200 cm/month or 26,400 cm/year $ 57,264.81 $ 51,326.00 $ 5,938.81 11.57
150mm 10,000 cm/month or 120,000 cm/year $ 229,131.42 $ 204,140.69 $ 24,990.73 12.24
200mm 13,000 cm/month or 156,000 cm/year $ 308,831.69 $ 275,638.93 $ 33,192.76 12.04
250mm 15,000 cm/month or 180,000 cm/year $ 366,263.57 $ 327,326.39 $ 38,937.18 11.90
April 6, 2009 - 5- CPS-2009-02
Other Fees and Charqes
Revenue from other fees and charges will be reduced by $375,000. The reduction resulted
from the expiry of the funding from OPG ($100,000), and the canceled transfer of General
Purpose funding for Fire Hydrant maintenance. Other fees and charges may experience a
slight increase due to the proposed rate increases.
Revenue Summarv
For 2009, the total water and sewer revenues are estimated at $39,678,600, an overall
increase of $2,557,500 or 6.9% over the 2008 Municipal Utility Budget revenues. Most of
the increase is the 12.9% increase in volumetric rates for water and sewer to pay the
Regional billings. The remaining increase is in monthly service charges, 8.8%forwater and
4.8% for sewer. The service charge increases are to make up for the reduced revenues
from OPG and the General Purposes Fund and to pay forthe increased City costs. Attached
to the report is the 2009 Schedule of Fees and Charges for Water and Sewer, and the 2009
Budget Statements.
Recommended by: ~~i~~'~riP"~/
Ken Burden, Executive irector of Corporate Services
Recommended by: ~ ~ t
Ed Dujlovic, Executi Director of Community Services
Schedule "A" to this amending By-Law No. 2009-
CITY OF NIAGARA FALLS
SCHEDULE OF RATES, FEES AND CHARGES
After Before
1. Service charges: Due Date Due Date
15 mm meter $ 2A.55 $ 23.38 monthly
18 mm meter $ 2A.55 $ 23.35 monthly
25 mm meter $ 24.55 $ 23.38 monthly
37 mm meter $ 73.65 $ 70.14 monthly
50 mm meter $ 147.29 $ 140.28 monthly
75 mm meter $ 294.59 $ 280.56 monthly
100 mm meter $ 540.08 $ 514.36 monthly
150 mm meter $1,031.06 $ 981.96 monthly
200 mm meTer $1,84118 $1,7535~ monthly
250 mm meter $2,577.65 $2,454.90 monthly
2. Water rates: After Before
Due Date Due Date
$ 0.7982 $ 0.7602 per cubic metre
3. Flat rates for a private water service not metered by choice or other determination o£the City:
After Before
Due Date Due Date
$ 48.49 $ 4619 monthly includes
30m3 ofusage
4. Flat rates for a private water service not metered because of refusal of owner:
After Before
Due Date Due Date
$145.48 $ 138.57 monthly
3 x the rate
5. Billing period:
Minimum of one month.
6. Service deposits:
Two times the estimated billing for a billing period with a minimum of the amount of
$230.00.
7. Sewer rates:
(a) Service charge as set out in section 1: 91.5'%
(b) Water rates as set out in section 2: 126.4%
(c) Flat rates as set out in sections 3 and 4: 108.7%
8. Charge for Installation of Water Service:
(a) 3/4" Service: $1,650.00
(b) Over 3/4" Service Actual cost - Deposit required based on estimated cosfs.
9. Charge for shutting off or tuming on supply of water:
(a) During normal warking hours: $ 55.00
(b) Outside normal working hours: $ 165.00
Note: For the purpose ofthis by-law, normal working hours shall mean Mondays to Fridays
(exclusive of holidays) between 8:00 a.m. and 4:00 p.m.
10. Charge for meter removal or reinstallation:
(a) During normal working hours: $ 40.00 per hour/per city employee
(b) Outside normal working hours: $ 100.00 per hoiir/per city employee
11. Charge for Testing Meter Consumption: At cost with a deposit of $75.00
12. Bulk carrier rate for CiYy stand-pipe:
(a) For Water $.95 per cubic metre
Cost plus 25%
-4-
(b) Seivice deposit: Based on estimated charges far two billing periods,
minimum of $500.00.
(c) Bulk water card purchase $10.00
13. Use of Water for Construction Purposes:
(a) At rates shown in sections 1 and 2 together with the cost to supply and install a metex.
(b) Service Deposit: based on estimated charges for two billing periods; minimum of
$500.00.
14. Charge for private water service accotmt transfen~ed to taac account:
(a) Per transaction fee of $22.00
CITY OF NIAGARA FALLS GL5280 Page : 1
Date : Mar 26, 2009 Time : 2:04 pm
Budget Report By Function
From Category : 100000 To Category : 823010
Account Code : 15-3-??????-???To : 15-4-??????-??????
2008 2008 2009
Account Code Account Description ACTUAL FINAL BUDGET FINAL BUDGET
VALUES -BUDGET -BUDGET
VALUES VALUES
15--> CITY WATER FUND
123010--> AUDITING SRVS
3--> EXPENSE
15-3-123010-040000 CONTRACTED SERVICES 5,000 5,000 5,000
Total EXPENSE 5,000 5,000 5,000
AUDITING SRVS Surplus/Deficit 5,000 5,000 5,000
132015--> INSURANCE CLAIM SRVS
3--> EXPENSE
1 5-3-1 3201 5-030~00 MATERIALS - INSURANCE ClAll 9,524 0 0
Total EXPENSE 9,524 0 0
INSURANCE CLAIM SRVS Surplus/Deficit 9,524 D 0
133005--> REVENUESANDRECV
3-> EXPENSE
153-133005-040000 CONTRACTEDSERVICES 700,135 631,164 726,077
Total EXPENSE 700,135 631,164 726,077
REVENUES AND RECV Surplus/~eficit 700,135 631,164 726,077
142075--> WSIB HEAITH SAFETY SICK SRVS
3•-> EXPENSE
153-142015-030000 MATERIALS 61,000 61,000 61,000
Total EXPENSE 61,000 61,000 61,000
W516 HEALTH SAFETY SICK SRVS Surplusl~eficit 61,000 61,000 61,000
431000--> SYSTEM MAINT WATERWORKS
3--> EXPENSE
153-431000-010DOD LqBOUR 1,283,082 1,510,420 1,648,471
1 53-431 000-01 001 3 EMPLOYEE BENEFITS ALLOCA- 293,965 306,216 395,633
15-3-431000-020000 LONGTERMINTEREST 27,088 27,488 21,967
153-431000-030000 MATERIALS 323,584 427,559 312,292
153-431000-030005 PERSONNEL DEVELOPMENT 0 16,646 18,000
153-431000-030007 ELECTRICITY 15,734 10,000 16,500
153-431000-030009 WATER 5,457 2,000 6,000
CITY OF NIAGARA FALLS GL5280 Pa9e ; z
Date : Mar 26, 2009 Time : 2:04 pm
Budget Report By Function
From Category : 100000 7o Category : 823010
Account Code : 15-3-??????-???TO : 75-4-??????-??????
2008 2008 2009
Account Code Account Description ACTUAL FINAL BUDGET FINAL BUDGET
VALUES -BUDGET -BUDGET
VALUES VALUES
15-3-431000-03D011 NATURAL GAS 161 1,000 1,000
153-43100D-030D15 ADVERTISINGlNEWSRELEASE 4,650 26,530 27,486
15-3-431000-030D17 INSURANCE PREMIUMS - SYSTI 68,138 69,820 70,867
15-3-431000-030018 CONFERENCES/CONVENTIONS 6,048 D 0
15-3-031000-040000 CONTRACTED SERVICES 362,652 409,610 501,645
153-431000-050000 RENTS AND FINANCIAL EXPENt 13,159 296,OD2 731,200
153-431000-070000 LONG TERM DEBT PRINCIPAL 99.018 98,718 104,463
153-431000-080002 TO CAPITAL HOLDING 4,500,000 4,500,000 4,500,000
153-431000-090000 INTERNAL RENT 208,555 205,526 2D7,418
Total EXPENSE 7,211,291 7,907,535 7,962,942
4--> REVENUE
15-4-031000-710000 USER FEES ~ -146,800 0 0
15-4-431000-710014 WATER CONSUMPTION FEES - -8,330,564 -9,006,450 -10,244,433
15-4-431000-710015 WATERSERVICEFEES-SYSTE -7,889,347 -8,165,005 -8,798,447
15-4-431000-710016 WATER FLAT RATE FEES - SYS -53,363 0 0
15-4-431000-710017 WATER STAND PIPE FEES - SY~ -52,653 0 -55,024
15-4-431000-710018 WATER TRANSFER AND SHUT ~ -28,620 -25,000 -25,D00
15-4-431000-77000D SALES -43,232 -50,000 0
15-4-431000-790000 OTHER REVENUE -16,124 -364,694 -90,000
Total REVENUE -16,560,703 -17,611,149 -19,212,904
SYSTEM MAINT WATERWORKS SurpluslDeficit -9,349,412 -9,703,614 -11,249,962
4320D0--> REGIONAL CHRGS WATERWORKS
3--> EXPENSE
153-432000-040000 CONTRACTED SERVICES 8,469,430 9,006,450 10,244,433
15-3-432000-050000 RENTS AND FINANCIAL EXPEN; 27,467 0 0
Total EXPENSE 8,496,897 9,006,45D 10,244,433
REGIONAL CHRGS WATERWORKS Surplus/Deficit 8,496,897 9,006,450 10,244,433
-
433000-•> WATER SYSTEMS RESEARCH & DEVMT
3--> EXPENSE
153-433000-010000 LABOUR - WATER SYSTEMS RE 0 0 111.655
153-433000-010013 EMPLOYEE BENEFITS ALLOCA" 0 0 26,797
15-3-4330D0-030000 MATERIALS - WATER SYSTEMS 0 0 60,000
15-3-433000-040D00 CONTRACTED SERVICES - WAl 0 0 15,000
Total EXPENSE 0 0 213,452
WATER SYSTEMS RESEARCH & DEVMT Surplus/Deficit 0 0 213,452
Total CITY WATER FUND -76,856 0 0
CITY OF NIAGARA FALLS GL5280 Page : 1
Date : Mar 26, 2009 Time : 2:05 pm
Budget Report By Function
From Category : 100000 To Category : 823010
Account Code : 163-??????-???To : 16-4-??????-??????
2008 2008 2009
Account Code Account Description ACTUAL FINAL BUDGET FINAL BUDGET
VALUES -BUDGET -BUDGET
VALUES VALUES
16•-> CITY SANITARY SEWER FUND
132015•-> INSURANCE CLAIM SRVS
3--> EXPENSE
163-132015-030000 MATERIALS - INSURANCE CLAII 749 0 0
Total EXPENSE 749 0 0
INSURANCE CLAIM SRVS SurpluslDefcit 749 0 0
142075--> WSIB HEALTH SAFETY SICK SRVS
3--> EXPENSE
163-142015-030000 MATERIALS 23,500 23,500 23,500
Total EXPENSE 23,500 23,500 23,500
WSIB HEALTH SAFETY SICK SRVS SurpiuslDefcit 23,500 23,500 23,500
411000--> SYSTEM MAINT SANITARY SEWER
3--> EXPENSE
163-411000-010000 LABOUR 633,743 658,287 529,658
163-411000-010013 EMPLOYEE BENEFITS ALLOCA- 153,065 117,046 127,118
163-411D00-020000 LONGTERMINTEREST 23,768 24,047 19,255
163-411000-030000 MATERIALS 97,636 255,901 85,000
16-3-411 D00-030017 INSURANCE PREMIUMS - SYSTI 83,260 86,200 87,493
163-411000-039000 SEWER REBATE MATERIALS 1,484 0 0
163-411000-040000 CONTRACTED SERVICES 1,306,620 1,477,787 812,500
163-4110D0-050000 RENTS AND FINANCIAL EXPENt 670 319,853 194,900
163-411000-070000 LONG TERM DEBT PRINCIPAL 85,862 85,861 90,583
163-411000-080002 TO CAPITAL HOLDING 4,645,000 4,645,000 4,645,000
163-411000-090000 INTERNAL RENT 5Q010 91,943 141,779
Total EXPENSE 7,081,118 7,755,925 6,733,286
4-•> REVENUE
16-4-411000-650000 GRANTS -20,000 0 0
16-4-411000-710000 USER FEES -10,510,354 -11,730,523 -12,423,041
i6-4-411000-710010 SEWER SERVICE CHARGES - S -7,462,289 -7,649,425 -8,012,691
16-4-411000-710011 SEWER FLAT RATE CHARGES - -60,678 0 0
16-4-411000-710012 SEWERLATERALCLEANING-: -28,767 -30,000 -30,000
16-4-411000-7900D8 OPG SEWER REVENUE - SYSTE -117,441 -100,000 0
Total REVENUE -18,199,529 -19,509,948 -20,465,732
SYSTEM MAINT SANITARY SEWER Surplus/Deficit -11,118,411 -11,754,023 -13,732,446
CITY OF NIAGARA FALLS G~5280 Page : 2
Date : Mar 26, 2009 Time : 2:05 pm
Budget Report By Function
From Category : 100000 To Category : 823010
Account Code : 163-??????-???TO : 16-4-??????-??????
2008 2008 2009
Account Code Account Description ACTUAL FINAL BUDGET FINAL BUDGET
VALUES -BUDGET -BUDGET
VALUES VALUES
412000--> REGIONAL CHRGS SANITARY SEWER
3-•> EXPENSE
163-412000-040000 CONTRACTEDSERVICES 11,594,428 11,730,523 12,423,041
TotaIEXPENSE 11,594,428 11,730,523 12,423,041
REGIONAL CHRGS SANITARY SEWER Surplus/Defcit 17,594,428 11,730,523 12,423,041
413000--> SANITARY SYSTEMS RESEARCH & DEVMT
3•-> EXPENSE
16-3-413000-010000 LABOUR - SANITARY SYSTEMS 0 0 148,875
16-3-413000-010013 EMPLOYEE BENEFITS ALLOCA- 0 0 35,730
163-413000-030000 MATERIALS - SANITARY SYSTE 0 0 65,000
76-3-413000-D40000 CONTRACTED SERVICES - SAN 0 0 1,030,OOD
16-3-413000-090000 INTERNAL RENT - SANITARY Sl 0 0 6,300
Total EXPENSE 0 0 1,285,905
iANITARY SYSTEMS RESEARCH & DEVMT Surplus/~efcit 0 0 1,285,905
- - -
Total CITY SANITARY SEWER FUND 500,266 0 D