Loading...
2004/09/20 CORPORATE SERVICES COMMITTEE AGENDA BARBARA MUIR FIRST MEETING Monday, September 20, 2004 Council Chambers - 6:15 p.m. Staff Contact 1. Reports: CPS-2004-03 - 2005 General Purposes Budget Discussion Tony Ravenda CPS-2004-04 - 2005-2009 Capital Projects Budget Discussion Tony Ravenda CPS-2004-05 - 2005 Municipal Utility Budget Discussion Tony Ravenda 2. Adjournment Corporate Services Department CPS-2004-03 Human Resources Tony Ravenda The Ci~ of 4310 Queen Street Executive Director P.O. BOX 1023 Niogara Foils Niagara Falls, ON L2E 6X5 Car~odo web site: www.city.niagarafalls.on.ca Tel: (905) 356-7521 Fax: (905) 356-5110 E-mail: travenda@city.niagarafalls.on.ca September 20, 2004 Alderman Wayne Campbell, Chair and Members of the Corporate Services Committee City of Niagara Falls, Ontario Members: Re: CPS-2004-03 - 2005 General Purposes Budget Discussion RECOMMENDATION: For the information of the Corporate Services Committee. BACKGROUND: The 2005 General Purposes Budget will be discussed in the Council Chambers during the Corporate Services Committee. The 2005 budget process will include several discussions as outlined in the 2005 budget schedule. A final budget review and approval will occur on December 6. This report provides information on the various Budget Issues that impact the 2005 General Purposes Budget. The Chief Administrative Officer directed Staff to prepare the 2005 General Purposes Budget in compliance with City Council's goal "to make every effort to maintain current levels of service without placing an increased burden on the City's Taxpayers". The Chief Administrative Officer has also directed staff to use City's Council's strategic priorities, Schedule "A', to guide the preparation of the budget. Staff has identified a number of challenges in preparing the 2005 Budget. They are as follows: REVENUES TAXATION: ASSESSMENT AND TAXATION For 2005, the property assessment will not undergo a re-assessment as in 2004. Due to the change in the valuation date from June 30 to January 1, a re-assessment of property values will be postponed until the 2006 taxation year. As a result, the total assessment will not change for 2005, except for all changes from the appeals, omits and supplementals processed in 2004. Working Together to Serve Our Community Clerk's Finance · Human Resources Information Systems · Legal Planning & Development September 20, 2004 - 2 - CPS-2004-03 WASTE MANAGEMENT For 2004, the City used a waste management tax rate that is based on property assessment. Staff intends to continue this method for collecting waste management revenues. TAXATION: PENALTIES AND INTEREST Since July 1, 1998, the penalty and interest rate has been set at one and one-quarter percent (1 - 1/4%) per month, which is the maximum rate permitted by the Municipal Act. Staff does not anticipate a change to this rate for 2005. PAYMENTS IN LIEU OF TAXATION The annualized PJ.L. from the Fallsview Niagara Resort (casino) will significantly increase the 2005 revenues. As in past years, this revenue has been used to directly offset the loan payments for the CN/CP railway corridor and the new community centre. GRANTS AND SUBSIDIES Local Services Reali~mnnent included the allocation of the Community Reinvestment Fund (CRF), a provincial grant to assist municipalities with the costs of transferred responsibilities. The City's 2004 allocation from the CRF was $3,153,000. Staffwill continue to use this allocation amount for 2005. Staff anticipates the successful award of a one-time grant from Ontario Power Generation Co. (formerly a part of Ontario Hydro) for the community impact from constructing additional capacity at the Sir Adam Beck generating station. This agreement is currently under review and therefore the grant may not be received in the year 2005. LICENCES, PERMITS, USER CHARGES, FEES, RENTALS Where appIicable, the approved increases to the Schedule of Fees for Services will be incorporated in the various revenue sources. Increasing these rates to a full cost recovery would provide significant sources of funds to pay for specific services. RESERVE FUNDS, RESERVES AND SURPLUS During 1999, the Niagara Falls Hydro paid out an outstanding debenture to the City's reserve funds. Staff will include $140,000 of that reserve fund to pay for the 2005 principal and interest payment. During 2001, the City debentured $99,100 more than required for the Lundy's Lane Battlefield Millennium project. These funds have been put into a reserve fund to help pay the annual principal payments. For 2005, $9,900 will be used to help pay the $27,000 payment. Staff will be including contributions of reserves to offset specific expenses. Staff is also considering various contributions from reserves to help offset the increase in expenditures. September 20, 2004 - 3 - CPS-2004-03 SUNDRY REVENUE The City receives an annual compensatory grant from Casino Niagara. The City also receives revenue from the Provincial Offences Act (POA) Inter-Municipal Agreement. The agreement, approved in May 2000, provides a sharing of net revenue with the Region and the other Niagara municipalities EXPENSES SALARIES, WAGES AND BENEFITS As of December 31, 2004, a three-year agreement with the Canadian Union of Public Employees, Local 133, will expire. Staff is using the approved 2004 salary/wage rates in the 2005 Budget. During 2003, a three-year agreement was negotiated and ratifi ed with the Niagara Falls Professional Fire Fighters' Association. Staff is also including additional firefighter complement to address the increasing demand for fire services. Staffis examining the costs for employee benefit plans and statutory contributions. Premium costs for benefit plans have increased effective September 1,2004 for a one~year period. Canada Pension Plan contributions and Employment Insurance contributions may increase from rate increments and salary/wage adjustments. During 2004, OMERS pension contributions had a significant increase, due to the return to the full contribution requirements. OMERS contributions for 2005 will only increase in relation to salary/wage adjustments. MATERIALS Staff is including a general inflation rate increase of 2.7% for the 2005 costs for materials and services. Energy expenses have significantly increased according to each of the relevant percent increases. General Insurance premium may be maintained for the 2005 policy term, however, claim payments may increase due to the increased deductible. CONTRACTED SERVICES Staff estimates the total expenditure for Contracted Services to increase for 2005. Most of the expenditure will be paid to the Region for waste management services. CAPITAL CONTRIBUTION The General Purposes and Municipal Utility budgets contribute annually to the Capital Projects Budget. The Municipal Utility Budget includes a 15% increase to waterworks and sanitary sewer capital projects. The General Purposes contribution has a guideline for amaual increases. The guideline suggests that 50% of the previous year's supplemental taxes be the maximum value for the annual increase. Staff is requesting direction as to whether this guideline be maintained, or, that General Purposes also increases its contribution by 15%. September 20, 2004 - 4 - CPS-2004-03 DEBT PAYMENTS At December 31,2004, the total debenture debt outstanding will be $11,962,118. During 2005, the contractual payment of $1,951,190 includes a reduction of $1,369,894 in principal and an interest charge of $581,296. Staff will be including contribution from reserve funds to help pay the annual payment. Per Council direction, Staffis using short-term financing for the railway acquisition and community centre. For 2005, the financing cost will approximate $941,000 on temporary loans of $20.6 million. Staff also anticipates the temporary loans to be reduced by $6.2 million. MUNICIPAL GRANTS TO AGENCIES, BOARDS AND COMMISSIONS City Council will be receiving requests from Agencies, Boards and Commissions for continued funding. Staff reminds the Committee that the requests are usually referred to "final budget deliberations". Staff will provide a summary of all 2005 requests compared to 2004 approved amounts. SUMMARY This report is intended to inform Council of the various issues that Staff will address that will impact the 2005 General Purposes Budget. This report will also serve as the starting point in which Council's direction on any of the above issues will be addressed and included as part of the final General Purposes Budget to be presented and approved on December 6, 2004. Recommended and Approved by: Respectfully submitted: T. Ravenda "~ John MacDonald Executive Director of Corporate Services Chief Administrative Officer Corporate Services Department CPS-2004-04 Human Resources Tony Ravenda City' of 4310 Queen Street Executive Director Niogoro Foils P.O. Box 1023 Conodo Niagara Falls, ON L2E 6X5 web site: w,,~v.city.niagarafalls.on.ca Tel: (905) 356-5110 Fax: (905) 356-5110 E-maih travenda@city.niagarafalls.on.ca September 20, 2004 Alderman Wayne Campbell, Chair and Members of the Corporate Services Committee City of Niagara Falls, Ontario Members: Re: CPS-2004-04 - 2005-2009 Capital Projects Budget Discussion RECOMMENDATION: For the information of the Corporate Services Committee. BACKGROUND: The 2005 budget process will include several discussions as outlined in the 2005 Budget Schedule. A final budget review and approval will occur on December 6. This report provides information on the various Budget Issues that impact the Capital Projects Budget. The purpose ora Capital Projects Budget is to provide descriptive details of the Capital Projects for the 2005 budget year and to provide information for future years' Capital Projects. A Capital Projects Budget also indicates the funding requirements and the sources of funds from the General Purposes, Municipal Utility, other funding sources and new borrowing. BUDGET ISSUES Fire Services Several new projects are being considered in the 2005 Fire Services capital program. The program includes the pumhase of vehicles, replacement of fire equipment, upgrading of existing fire station facilities, and replacement o f radio communications hardware. Some ofthe funding will come from general purposes and other funds, however, some borrowing may be necessary to provide sufficient funding for immediate program items. Working Together to Serve Our Community Clerk's Finance Human Resources Information Systems Legal Planning & Development September 20, 2004 - 2 - CPS-2004-04 Municipal l~orks Tbe 2005 Municipal Works capital program includes several projects already in progress. Some of the major projects include Montrose Road, Stanley Avenue storm, Fallsview Boulevard and Muddy Run high rate treatment. The program expenditures will be funded from Roads, Storm Sewer, Sanitary Sewer, Water, other funding, and new borrowing. Some of the new projects include Dorchester Road, Drummond Road, Portage Road, and Muddy Run reconstruction, Beaverdams Road, Kalar Road, and Garner Neighbourhood pump station. Also included are the annual programs such as asphalt overlay, vehicle replacement, sidewalk construction, watermain replacement, and combined sewer separation. Parks, Recreation and Culture The 2005 Parks, Recreation and Culture major project is the Community Centre, which will be funded from the YMCA, Community fund-raising, Provincial grant, and new borrowing. Other significant projects include the Beautification Projects, Kalar Road Girls Home for Soccer, Chippa~va/Willoughby Memorial Community Park, and Garner Neighbourhood Park and Trail. Niagara Fails Transit The 2005 Niagara Falls Transit capital program purchases two new transit buses and is funded from general purposes, development charges, provincial grant and new borrowing. Niagara Falls Public Library The 2005 Niagara Falls Public Library capital program projects that focus on books, materials and equipment for the new south-west facility and is being funded from general purposes, reserves, development charges, and new borrowing. SUMMARY This report is intended to inform Council of the various factors that will impact the 2005 Capital Projects Budget. This report will also serve as the starting point in which Council's direction on any of the above issues will be addressed and included as part of the final budget presented on December 6, 2004. Recommended and Approved by: Respectfully submitted: Ravenda xlL/~~'- John MacDonald T. Executive Director of Corporate Services~"' Chief Administrative Officer Corporate Services Department CPS-2004-05 Human Resources Tony Ravenda 4310 Queen Street Executive Director The City of ~1~ P.O. Box 1023 Niogoro Follstlk Niagara Falls, ON L2E 6X5 CQFi~Q ~. web site: www.city.niagarafalls.on.ca ~ I -- Tel: (905) 356-7521 Fax: (905) 356-2016 E-mail: travenda@city.niagarafalls.on.ca September 20, 2004 Alderman Wayne Campbell, Chair and Members of the Corporate Services Committee City of Niagara Falls, Ontario Members: Re: CPS-2004-05 - 2005 Municipal Utility Budget Discussion RECOMMENDATION: For the information of the Corporate Services Committee. BACKGROUND: The 2005 budget process will include several discussions as outlined in the 2005 Budget Schedule. A final budget review and approval of the water sewer rates will occur on December 6. BUDGET ISSUES REVENUES CONSUMPTION RATES The water and sanitary sewer consumption rates £und the expenditures from the Region for water filtration and sewer treatment. The water consumption rate is calculated by dividing the total water cost from the Region by the quantity of water billed to ratepayers. Since 2001, when water metering was implemented for the residential sector, the water consumption rate has increased from $0.410 per cubic meter to $0.514. This increase of approximately $0.104 per cubic meter matches the increased unit cost of water supply from the Region. Working Together to Serve Our Community Clerk's · Finance Human Resources Information Systems Legal Planning & Development September 20, 2004 - 2 - CPS.2004-05 The sewer consumption rate is calculated by dividing the total sewer treatment cost from the Region by the quantity of water billed to ratepayers where sewer services are provided (some customers in the City do not receive sewer service). Since 2001, the consumption rate has increased from $0.806 per cubic meter to $0.891. This increase of approximately $.085 per cubic meter is greater than the increased unit cost of sewer treatment from the Region. The difference may be the result of larger quantities of sewer treated compared to smaller quantities of water billed. SERVICE RATES Service Rates fund the costs to maintain the waterworks and sanitary sewer systems. These costs are primarily a maintenance function (hard services), but such items as billing and collection (soft services) are included. Both Water and Sewer service rates are calculated by dividing the total costs by the number of water meters. Since 2001, the combined service rate for the residential sector has increased from $21.37 per month to $29.83. This increase has resulted from regular operating maintenance cost, but more so, from the annual increase in contribution to capital works. REFUND OF REGIONAL SEWER TREATMENT COSTS Staff has prepared Report CPS-2004-02, Sewer Consumption Rate Refund, for Council's consideration. This issue is separate from the Municipal Budget discussion, unless Council directs otherwise. EXPENDITURES WAGES AND BENEFITS As of December 31,2004, a three-year agreement with the Canadian Union of Public Employees, Local 133, will expire. Staff is using the approved 2004 salary/wage rates in the 2005 Budget. Staff is examining the costs for employee benefit plans and statutory contributions. Premium costs for benefit plans have increased effective September 1,2004 for a one-year period. Canada Pension Plan contributions and Employment Insurance contributions may increase from rate increments and salary/wage adjustments. During 2004, OMERS pension contributions had a significant increase, due to the return to the full contribution requirements. OMERS contributions for 2005 will only increase in relation to salary/wage adjustments. DEBT PRINCIPAL AND INTEREST PAYMENTS The 2005 charges for the payments of interest and principal are expected to remain stable due to no change in debt commitment during the past year. h~ the capital program, should any of the water and sanitary sewer projects require debt financing, the servicing of the new debt will begin in 2006. MATERIALS The materials budget includes the estimated costs for the purchases of supplies, small equipment and services. Staff anticipates that there will be a general increase of 2.7% in this expense. September 20, 2004 - 3 - CPS-2004-05 CONTRACTED SERVICES Services purchased from external suppliers and contractors are recorded in the Contracted Services Budget. The principal supplier is the Region of Niagara for water filtration and sewage treatment. Staff has been advised that the Region expects the rate per cubic meter to be increased by 10% for water supply and 5% for sewage treatment. RENTS AND FINANCIAL The billing and receipting services, provided by Niagara Falls Hydro, will continue to be paid on a full cost recovery basis. Staff is currently reviewing the services provided and the costs associated with the billing and receipting services done by Niagara Falls Hydro. The Rents and Financial budget sheet also makes provision for Audit Fees, Advertising, the Sewer Rebate Program and the Low-Income Seniors Water Rebate Program. Staffanticipates that a general increase of 3% will occur for this expenditure. TRANSFER TO OWN FUNDS Transfer to Own Funds includes transfers to reserves and Contribution to Capital Projects. These Transfers provide funding for waterworks and sanitary sewer system infrastructure construction and maintenance. Staff is including a 15% increase in consideration of City Council's new strategy to increase the amount of expenditures for the rehabilitation of both water and sanitary sewer systems. SUMMARY This report is intended to inform Council of the various factors that will impact the 2005 Municipal Utility Budget. This report will also serve as the starting point in which Council's direction on any of the above factors will be addressed and included as part of the final utility budget presented on December 6, 2004. Recommended and Approved by: Respectfully submitted: T. Ravenda Executive Director of Corporate Services Chief Administrative Officer