2007/09/24CORPORATE SERVICES COMMITTEE AGENDA
TENTH MEETING
Monday, September 24, 2007
Committee Room 2 - 5:00 p.m.
1. Approval of the July 23, 2007 Corporate Services Meeting
2. REPORTS:
a) F-2007-33
Financial Policies
b) CPS-2007-03
Water and Sewer Rates Review
c) F-2007-35
2006 Consolidated Financial Statements (Handout)
d) F-2007-36
2008 Budgets
3. NEW BUSINESS:
STAFF CONTACT
Ken Burden
Ken Burden
Todd Harrison
Todd Harrison
4. ADJOURNMENT:
a) Resolution to go into Closed Meeting.
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Niagara,~alls
ca~an.+
CORPORATE SERVICES MINUTES
NINTH MEETING
MONDAY, July 23, 2007
COMMITTEE ROOM #2 - 4:00 pm
PRESENT: Mayor Ted Salci, Councillor Victor Pietrangelo, Chair; Councillors
Jim Diodati, Shirley Fisher, Carolynn loannoni, Vince Kerrio, Bart
Maves, Wayne Thomson and Janice Wing.
STAFF: John MacDonald, Trent Dark, Ken Burden, Denyse Morrissey, Bill
Matson, Ken Beaman, Geoff Holman, Todd Harrison, Marzenna
Carrick, Dave Stuart, Anny Felicetti and Lisa Wall.
PRESS: Ray Spiteri, Niagara Falls Review
Rob Lapensee, Niagara This Week
*******
1. MINUTES
MOVED by Mayor Salci ,seconded by Councillor Diodati, that the minutes
of the May 28th meeting be approved as recorded.
Motion Carried Unanimously
2. REPORTS:
F-2007-28 -Annual Investments Report for 2006
MOVED by Councillor Thomson seconded by Councillor loannoni ,that the
2006 Annual Investments Report be received for information.
Motion Carried Unanimouslv
F-2007-29 -Proposed Changes to Water Billing
and Process for the 2007 Utility Budget
MOVED by Councillor Diodati, seconded by Councillor Wing, thatthe supply
of water for a tenanted water account be shut off when the tenant fails to
provide or continue to provide the required deposit in full; and in situations
wherein a change of tenants has occurred, the property owner is required
to have written direction to staff regarding the establishment of the new
account.
Motion Carried Unanimouslv
-2-
DEPUTATION:
Mr. Ed Bielawski addressed the Committee regarding his review of water
and sewer rates. Mr. Bielawski has studied many of the documents
available on this subject and shared his conclusions with the Committee.
CPS-2007-02 -BMA Water and Wastewater Rate Review Proposal
MOVED by Councillor Thomson, seconded by Councillor loannoni:
That staff report back to Council on the report provided and presented by
Mr. Ed Bielawski;
That staff contact Mr. Michael Loudon as a follow up to his 2000 report;
That staff provide Council with a copy of the Loudon report;
That Staff undertake a water and sewer rates review in time for
consideration of the 2008 Utility Budget.
Motion Carried Unanimously
3. COMMUNICATIONS
MOVED by Councillor Wing, seconded by Councillor loannoni, that the
correspondence from Amanda Occasion for a donation to the Global Youth
Network initiative be received and filed, and that a policy be established in
regards to correspondence requesting donations.
Motion Carried Unanimously
4. ADJOURNMENT:
There being no further business, the meeting adjourned at 4:55 p.m.
Motion Carried Unanimously
September 24, 2007
Niagara~alls
Cr1NADA
Councillor Victor Pietrangelo, Chair
and Members of the Corporate Services Committee
City of Niagara Falls, Ontario
Members:
Re: F-2007-33
Financial Policies
RECOMMENDATION:
For the consideration of the Corporate Services Committee.
BACKGROUND:
F-2007-33
On March 19, 2007, the Corporate Services Committee received report F-2007-12,
Financial Policies, and approved the following motion:
"That Council have regard for the Financial Policies presented for
consideration in the upcoming strategic planning session."
With the help of BMA Management Consulting Inc., these policies were developed
following an in-depth analysis of the City's financial indicators. Financial Policies have
been developed in the following key areas:
• General Financial Policies
• Asset Management Policies
• Reserve Policies
• Debt Policies
• User Fee Policies
Staff has continued the review of the policies in three of the key areas. Reserve, Debt,
and User Fee policies have been specifically reviewed in time for the 2008 Budget.
Working Together to Serve Our Community
Corporate Services Departm~
Finance
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September 24, 2007 - 2 - F-2007-33
Financial Implications
The three financial policies will provide the guidance for Staff's preparation of the 2008
Budget. However, the policies may incur additional budget requests. During the review,
Staff discussed the financial implications of implementing contributions to reserves,
restricting debt usage, and instituting new user fees.
Reserve contributions in previous years have generally focussed on capital funding,
stabilization, and unfunded liabilities. The Reserve policy identifies seven classifications
which would each have suggested contribution targets. Staff realized that the inclusion of
such targets would significantly challenge Council's ability to stabilize tax rates.
Consequently, the policywas revised to recognize that contributions should be phased over
ten years. The phase-in plan would address the need for the reserve as well as Council's
ability to satisfy the need.
An example, provided by BMA Consulting Inc., demonstrates the phase-in plan. Currently
the City contributes approximately $390,000 to a Building/Facility Reserve. The amount
falls well short of the Reserve policy contribution target. Based on a building asset value
of $73.4 million, the contribution target of 1.5% to 4.0% would equate to $1,100,000 to
$2,900,000 per year. To reach the low end of the target range, Council could increase the
reserve contribution by $71,000 annually for ten years. The following chart details the
annual contributions:
2008: $390,000 + ($71,000 x 1) _ $461,000
2009: $390,000 + ($71,000 x 2) _ $532,000
2017: $390,000 + ($71,000 x10) _ $1,100,000
Debt usage has significantly increased over the past few years, as Council has approved
long term debenture financing for large capital projects such as the McBain Community
Centre and the Dorchester Road reconstruction. The Debt Management policy focuses on
what kinds of capital projects are suited for debenture financing. Staff's discussion on the
policy's impact noted that many of the 2008-2011 projects would not qualify for debt
financing. Ideally, these projects would be funded from Reserves that correspond to the
lifecycle replacement plan. The policy does provide an interim plan for these projects, until
annual reserve contributions are sufficient to meet the lifecyle needs of all assets. The
interim plan does involve debt financing, however, the incurrence of this debt would be
managed in parallel with the annual contributions to lifecycle reserves.
User Fee policies are intended to generate revenues for specific services. Staff's
discussion on this policy noted the increasing public acceptance of such fees. Similarly,
taxpayers are not as tolerant of using property taxes to subsidize City services for specific
users. The impact of instituting new or increasing the existing user fees will have both
advantages and disadvantages. Naturally, City revenues may increase as a result of the
adjusted user fees. However, users may decide to obtain the desired services elsewhere
due to the change in their costs.
For the consideration of the Corporate Services Committee, the- revised policies for
Reserves, Debt, and User Fees are as follows:
September 24, 2007 - 3 - F-2007-33
Reserves Policies
Maintaining Reserves -Policy Statements
1. The City will maintain financial reserves:
• To provide stability of tax and user rates
To provide financing for one-time or short term requirements
• To segregate funds received and/or to be used for a specific purpose
• To make provisions for replacements/acquisitions of assets/infrastructure
• To provide for future liabilities incurred in the current year expenditure
Monitoring and Reporting - Policy Statements
1. Reserves will be reviewed on an annual basis to determine their adequacy and a
report will be prepared to Council.
2. Reserve and Reserve Funds will be classified as:
• Building/Facility Reserves
• Capital Reserves
• Vehicle/Equipment Reserves
• Stabilization Reserves
• Program Specific Reserves
• Corporate Reserves
• Development Charge Reserves
3. Reserves will be supported by a financial plan identifying contribution sources and
projected disbursements.
Building/Facility Reserves Policies
1. Full life cycle costing will be undertaken to ensure that reserves are adequate to meet
the ongoing replacement and refurbishment needs of the City's building/facility assets.
2. An annual operating transfer will be made to the reserve in the range of 1.5% to 4.0%
of the replacement cost of the asset. As a result of current reserve shortfalls, the City
will phase-in these contributions over a period of 10 years and will gradually increase
annual contributions until the annual contribution is equivalent to 1.5% of the asset
value.
3. Reserves will be established and contributions will be made to support all municipally
owned buildings/facilities.
4. All building/facility reserveswill be credited interesttomaintain purchasing power parity
September 24, 2007 - 4 - F-2007-33
Capital Reserve Policies
1. Water, Sewer and General Capital Reserves will be established and maintained.
2. The City will contribute 1 % of the asset value to the reserves for waterworks and
wastewater on an annual basis. The annual contributions will be phased-in over a
period of 10 years.
3. All capital reserves will be credited interest to maintain purchasing power parity.
Vehicle and Equipment Replacement Policies
1. Vehicle and equipment replacement reserves will be established and maintained.
2. Reserves for vehicle and equipment replacement will be funded through calculated
annual contributions from the Operating Budget, based on life-cycle and replacement
costing and a depreciation schedule.
3. All equipment and vehicle reserves will earn interest to maintain purchasing power
parity.
Stabilization Reserve (Tax and Rates) Policies
1. The Citywill maintain separate reserves forTax Stabilization, Water Rate Stabilization,
and Sanitary Sewer Rate Stabilization Reserves.
2. To provide sufficient flexibility and protection for unforeseen events, the target range
to be maintained in the Tax and Rate Stabilization Reserves will be set at 5%-10% of
gross expenditures.
3' Balances in the Stabilization Reserves will be reviewed annually relative to the target.
Shortfalls from the target will be funded from annual operating surpluses.
4. The City will maintain a Building Permit Stabilization Reserve. The Reserve would be
specifically for funding any shortfalls within the Building Code Act fees and would not
be available to fund any other municipal financial priorities. The Reserve will be
funded from year end surpluses and will have a target of 150% of the budgeted
operating expenditures for the Building Division. The Reserve will have a dual
purpose:
• To manage the risk associated with an economic downtown
• To manage the financial implications resulting from additional compliance costs
Program Specific Reserve Policies
All program specific reserves will be reviewed annually and will have a financial plan
associated with each reserve.
September 24, 2007 - 5 - F-2007-33
Corporate Reserve Policies
1. Corporate Reserves will be monitored annually to ensure that appropriate funds are
set aside to meet future obligations.
2. Annual contributions will be made to meet future obligations associated with Worker's
Compensation, Sick Leave Liability and other long term obligations.
3. Actuarial valuations of long term obligations will be undertaken every three years.
Debt Management Policies
1. The City will monitor all forms of debt and annually report to Council an analysis of
outstanding obligations; concerns and recommended remedies will be reported to
Council as necessary.
2. Debt charges (principal and interest payments) will be limited to the Provincial
Threshold of the City's on source funds.
3. Debt financing will be employed as a means of financing projects related to:
• Increased/new services to residents for new initiatives;
• New, non-recurring infrastructure requirements;
• Programs and facilities which are self supporting; and
• Projects where the cost of deferring expenditures exceeds debt servicing costs
• The growth costs not recovered from Development Charges
4. Lifecycle projects which renew and rehabilitate existing assets should not be eligible
for debenture financing. A planning process will be developed whereby an annual tax
contribution will be made to meet Lifecycle needs of all assets. In the interim, the City
will undertake ashort-term, managed program of debt financing to address the City's
current infrastructure deficiency and to reduce further deterioration of the City's
infrastructure.
5. The length of the term of debt should not exceed the useful life of the asset.
6. Debt will be structured for the shortest period consistent with a fair allocation of costs
to current and future beneficiaries or users.
General User Fee Policies
1. User fees will be charged by the City where:
• There is a clear relationship between fees paid by users and the benefits
received by users;
• The user has a choice as to the extent to which he/she uses the service;
September 24, 2007 - 6 - F-2007-33
• It is administratively feasible to collect the charge at a reasonable cost
2. The City will:
Ensure that the full costs permitted under the legislation and regulations are
identified and establish a policy to set standards for each fee and rate
charged which will identify:
• Which costs are to be recovered from fees
The extent to which fees will be discounted/subsidized from the
general tax base
Conduct a cost study for each of the services for which a fee is charged
Communicate with the public to explain the purpose for charging user fees.
3. The City will strive to increase/maintain user fees as a percentage of overall funding
by identifying new areas where user fees can be implemented and by ensuring that
existing fees are updated based on increases in the associated expenditures to
provide the services.
4. Revenues from user fees will not exceed the cost of providing the service as
permitted under the legislation and regulations.
5. Rate/fee structures will be sensitive to the "market" for similar services. In setting
user fees, the City will consider fees charged by other agencies/municipalities.
6. In accordance with the pertinent legislation and regulations, the City will hold public
meetings as required, or for the benefit of the target market and general public.
10. New fees and any significant fee changes may be phased in over a number of years
and in consultation with user groups and the community where feasible.
Building Permit Fee Policies
Where the service is regulatory in nature and voluntary compliance is not expected
to be the primary method of detecting failure to meet regulatory requirements as is
the case for building permit fees, the fee will be set to recover the full cost of service.
2. All eligible costs in accordance with Bill 124, an Act to Improve Public Safety and to
Increase Efficiency in Building Code Enforcement will be identified for each fee and
fees will be based on 100% cost recovery.
Planning Fee Policies
Where the service is regulatory in nature and voluntary compliance is not expected
to be the primary method of detecting failure to meet regulatory requirements as is
the case for planning fees, the fee will be set to recover the full cost of service.
2. The City will calculate fees such that all eligible costs in accordance with Section 69
of the Planning Act will be identified for each fee and fees will be based on 100% cost
recovery.
September 24, 2007 - 7 - F-2007-33
Recommended by:
Respectfully submitted:
K. E. Burden, Acting Executive Director of Corporate Services
MacDonald, Chief Administrative Officer
September 24, 2007
Niagara,Falls
CA NA Di1
Councillor Victor Pietrangelo, Chair
and Members of the Corporate Services Committee
City of Niagara Falls, Ontario
Members:
Re: CPS-2007-03
Water and Sewer Rates Review
RECOMMENDATION:
CPS-2007-03
1. That the information provided in response to "Water Rate Study" be received and
filed,
2. That the Corporate Services Committee authorizes Staff to engage consulting
services to review the City's water and sewer rates.
BACKGROUND:
On July 23, 2007, Staff presented report CPS-2007-02, BMA Management Consulting Inc.
Proposal, that requested the Committee to authorize Staff to engage the consultant to
review the City's water and sewer rates. During the Committee's consideration of this
report, the Committee also heard a deputation from Mr. Ed Bielawski, who presented
several conclusions in a handout document, entitled "Water Rate Study". The deputation
made reference to staff reports and awater/sewer rate study done by Loudon & Fortin
(November 2000). Following the deputation, the Committee approved the following four
recommendations which were ratified by City Council:
1) That Staff report back to Committee on the report provided and presented by Mr.
Ed Bielawski,
2) That Staff contact Mr. Michael Loudon as a follow-up to his 2000 report,
3) That Staff provide Committee with a copy of the Loudon report, and
4) That Staff undertake a water and sewer rates review in time for consideration of the
2008 utility budget.
Staff has contacted Mr. Michael Loudon regarding the Niagara Falls Rate Report, prepared
and submitted by Loudon and Fortin in November 2000. This report focused on the
existing water and sewer rates and made recommendations on future rates as s_a~cult of
^- I.
Working Together to Serve Our Community 'corporate Services department
Finance
September 24, 2007 - 2 - CPS-2007-03
the newly implemented metering program. A copy of the report is attached for the
Committee's information.
Staff requested Mr. Loudon to prepare and submit afollow-up to the November 2000
report. Staff also sent a copy of Mr. Bielawski's Water Rate Study document to Mr. Loudon
for information. Mr. Loudon is willing to prepare afollow-up to his November 2000 report,
which also addresses the conclusions raised by Mr. Bielawski. Mr. Loudon advised the
follow-up report would incur some cost. Staff believes the follow-up report could be
undertaken by a qualified consultant during the engagement for a review of the water and
sewer rates. Consequently, Staff did not pursue the follow-up report from Mr. Loudon.
Staff has not yet proceeded with undertaking a water and sewer rates review. As the
Committee was interested in the Loudon report and the conclusions raised by Mr.
Bielawski, the rate review was postponed pending the Committee's further consideration
of the proposal from BMA Consulting Inc. Staff continues to recommend the proposed
engagement of the consultant as presented in the earlier report CPS-2007-02.
Information provided in response to "Water Rate Study"
Staff has investigated and prepared the following information that responds to the seven
conclusions raised in Mr. Ed Bielawski's deputation as they appear in his "Water Rate
Study" document.
1. Conclusion -The City has no water/sewer utility
Mr. Bielawski observed that a city report dated March 27, 1995, provided several
objectives, one of which was that the city establish awater/sewer utility. Mr. Bielawski
commented that awater/sewer utility if it is going to be run like a business, then it would
be no different than the Niagara Falls Hydro. His conclusion states the City does not have
a separate authority (such as NFH) responsible for the water/sewer utility and that as a
result the utility is fragmented by having several functional parts reporting to the Council.
The report which Mr. Bielawski referenced was MW 95-58 Water/Wastewater Utility. The
recommendation from the Community Services Committee to and approved by Council
was as follows:
"That endorsement be given to the establishment of aSelf-Supporting, User-Pay
Water/Wastewater Utility, including Universal Water Metering, effective January 1997;
"That a Public Education/Awareness Program, including a public Attitude Survey, on the
Utility Concept and its impacts be undertaken with the results of same to be reported to
Council before any implementation action; and
"That Staff be directed to develop an Implementation Strategy for the Water/Wastewater
Utility with periodic Status Reports or Approval Reports for the various components. "
For the years 1995-2000, Staff undertook the directions of Council in an exhaustive effort
to encourage as much Public Participation as possible. One of the foremost concerns of
ratepayers was the ability to control the costs of water and sewer service. At that time, the
City was using a flat rate billing structure for residential ratepayers. Residents were
concerned that there was no ability to reduce their individual water billing by reducing their
September 24, 2007 - 3 - CPS-2007-03
consumption ofwater. This concern also raised the significant issue ofwaterconservation.
On December 11, 2000, Council approved the following recommendations from the
Corporate Services Committee which were based on the Loudon & Fortin November 2000
report:
"That the proposed use-based billing structure be adopted for determining water/sewer
utility rates, and
"That the proposed use-based billing structure be applied to the 2000 Budget Expenditures
to set rates for the new Water By-Law; and
"That the Updated Water By-Law be adopted."
Staff advises that the City has operated a water system as aself-supporting fund up until
1999, when the existing fund was expanded to include the operation of the sanitary sewer
system. The self-supporting fund is separate from the General Purposes Operating Fund.
Although the water and sewer system was renamed Municipal Utility, staff notes that
Council has not approved the implementation of an appointed/elected authority that was
separate from and reporting to the City Council.
In 2004, the water/sewerfund was separated into two funds; one each for the water system
and the sanitary sewer system. The separation was done in compliance to the current
legislation wherein the water and sanitary sewer services must have separate fund entities.
Staff advises that today's presentation of the water and sanitary sewer budgets has used
the header "Municipal Utility" in continuance of the familiar identity for the water and sewer
systems. City Council is the management authority and is responsible for the water and
sewer systems. Staff administrates this responsibility in two parts: the operations part is
administrated by the Municipal Works Division, the billing/collection part is administrated
by the Finance Division.
Staff advises that Mr. Bielawski's comparison of the water/sewer system to Niagara Falls
Hydro as a utility may not be applicable. The operating structure for an electricity utility
versus the operating structure for a water or sewer utility is identified by the legislation that
governs each service. The Niagara Falls Hydro, which was incorporated under provincial
legislation, falls under special business corporation legislation. Its governance and
structure must adhere to the Electricity Act. Water and sewer services also comply with
provincial legislation, mainly the Municipal Act, as well as other specific legislation such as
the Safe Drinking Water Act, and the Sustainable Water and Sewage Systems Act.
Staff advises that the Loudon report in November 2000, did not address the governance
structure for awater/sewer utility. Council has always maintained that the water and sewer
funds would be directly controlled by the Council and not be managed by an
appointed/elected Board or Commission reporting to Council.
2. Conclusion -The use-based principle for water billing
is applicable only for the consumption charge
Mr. Bielawski, in his comments, stated that the more you use, the less you pay. In his
Water Rate Study, he combined the fixed monthly charge with the consumption charge for
September 24, 2007 - 4 - CPS-2007-03
increasing amounts of water usage. He showed that the combined charge decreases on
a per unit basis as the consumption of water increases. He showed that the annual
percentage increase for high consumption was less than the percentage increase for low
consumption. Mr. Bielawski's analysis basically shows the inverse cost relationship of a
fixed charge being applied to a variable factor.
Staff advises the water and sewer billing is composed of fixed and volumetric charges.
The two part charges were implemented in 2001, when metering was fully implemented.
Each charge is designed to collect sufficient revenues to offset the relevant direct costs.
Staff advises that the fixed monthly charge is not related to the direct costs of consumption.
The fixed charges are intended to offset the fixed costs of maintaining the water and
sanitary sewer systems. The City has the responsibility to provide safe potable water in
sufficient supply for all users including fire suppression. The City is responsible for
providing the collection of sanitary sewage. The direct operating costs of labour and
materials, and the direct construction costs of repairs and maintenance are incurred
regardless of the users' consumption. The fixed monthly charges are not dependent upon
or related to the amount of consumption incurred.
The volumetric charge is a per cubic meter rate that is the same for every user. The rate
does not decrease or increase with the amount of consumption. The revenues collected
from the consumption charges are intended to offset the costs of water purchased from the
Region and the sewer treated by the Region. These costs are also based on a volumetric
charge, whose rates are the same for all the municipalities in the Region of Niagara.
Staff understands that the use-based principle can apply to both a fixed charge and a
consumption charge. The use-based principle applies to a fixed charge because the user
is connected to water and sewer systems that are always ready to serve the user. The
user pays for the right to draw water and/or to flush sewage. The use-based principle also
applies to a consumption charge. because the quantity of usage is measured and billed to
the user.
3. Conclusion -The use of meter size for
allocation of service charge is totally flawed
During the meetings that Mr. Bielawski attended with staff, his comments cited that the use
of meter sizing for the allocation of monthly service charges is flawed. His comments are
directed at the City's use of the AWWA standard for differentiating between the sizes of
meters and using the differences to allocate costs.
Staff advises that the size of a water meter relates to the size of the demand flow for water
provided to the user. Some users require a larger demand flow than others. Both the
water and sanitary sewer systems are engineered to accommodate the variant sizes of
both water flows and sewer usage. Staff advises that the AWWA standard is recognized
and approved in municipalities throughout Ontario, Canada and the United States. As this
standard is recognized and used, Staff believes it is an appropriate standard by which to
allocate fixed costs to users having different sizes of meters.
Mr. Bielawski commented that allocating fixed costs on the basis of meter size is also
flawed. His comments were directed at users who consume large quantities of water in
comparison to residents who use very little water. He suggested that the basis for the
September 24, 2007 - 5 - CPS-2007-03
allocation of fixed costs should reflect the amount of water usage and not the size of the
water demand flow.
Staff advises that the fixed monthly charges for maintaining the water and sewer systems
include all of the infrastructure costs. The systems are composed of different sizes of pipe,
valves, pumps, and meters. Infrastructure costs can be significantly different for repairing
the various components of the systems. Tracking and allocating these costs to individual
users based on their actual usage would present a significant mathematical undertaking.
For example, the actual repair for a section of water-main pipe can be easily costed, but
very difficult to determine which downstream users should be charged and how much. The
use of the AWWA standard provides an efficient engineering approach to allocate the
infrastructure costs using the size of a meter to estimate the user demand on the systems.
4. Conclusion -All multi-unit structures that have a single
meter are significantly subsidized by residential customers
In Mr. Bielawski's Water Rate Study document, he provided an analysis named "Customer
Service Charge Cost/Unit". The analysis compared the fixed monthly charge for customers
who have different sizes and quantities of water meter service. The analysis calculates the
monthly fixed cost per customer based on the quantity of customers being serviced by the
quantity and size of meter. He concludes that the cost/unit varies in accordance with these
factors, and further concludes that the higher cost/unit customers are subsidizing the lower
cost/unit customers.
Staff advises that acost/unit analysis may be interpreted as a Poll tax. The emphasis of
the analysis is focused on the number of customers served, even though some of the
customers are not separately served by the water and sewer systems. The analysis could
be expanded to any water meter that serves more than one identifiable customer, eg. hotel
rooms, retail mall tenants, business mall tenants, apartment building units. A poll tax,
which is not allowed by the Municipal Act (Sec.393), imposes a charge on the reason that
persons/businesses are simply resident in the municipality or a part of it. Mr. Bielawski's
analysis assumes that the City has the right to impose a charge simply because a City
resident uses the water and sewer systems.
In general, the Municipal Act (Sec.391) only allows a municipality to impose fees and
charges for services or activities provided or done by or on behalf of the municipality. To
impose a fixed monthly water charge, the municipality must identify to whom the water
service is being provided. Currently the City's fixed monthly charges are being billed to the
customer who has the direct responsibility for the water/sewer account.
Staff advises that this same concern is evident in other municipalities where water services
to condominium units are charged differently. The differences result from the same
engineering disparity. Some condominium units have individual water services, while
others have a single service for all the units. In Staffs report CPS-2007-02, Staff
recommends that a full review of water/sewer rates be undertaken. A review would
address the concerns that Mr. Bielawski has raised.
5. Conclusion -The aricina for water and sewer service is unfair and not equitable
Mr. Bielawski's conclusion refers to the structure for the City's water/sewer rates. The rates
September 24, 2007 - 6 - CPS-2007-03
are billed in two parts: a fixed monthly charge and a volumetric charge. His conclusion
directs attention to the low volume user whose minimum monthly billing is the monthly
service charge, even if the user has not used any water. His concern is that the City's fixed
monthly charge has increased significantly over the past years, and has resulted in
unfair/not equitable charges to low volume users. He believes the water/sewer rate should
be totally volumetric with no fixed charges.
Staff advises that the water/sewer rate structure was established in 2001 when metering
was implemented. The structure was recommended in the Loudon & Fortin report which
Mr. Loudon addresses in his follow-up report. The report did examine a variety of methods
to charge for water and sewer services. Although Mr. Bielawski recommends a simple
volumetric charge, he concurs with Staff that several methods exist. In Staff's report CPS-
2007-02, Staff recommends that a full review of water/sewer rates be undertaken. A
review would address the concerns that Mr. Bielawski has raised and would compare the
simple volumetric charge method to other methods of charging for water/sewer services.
6. Conclusion -Yearly percentage rate increases as reported are not factual
In Mr. Bielawski's Water Rate Study, he provides an analysis of the 2007 percentage
increase for homeowners whose monthly usage of water is different. His conclusion
references Staff's report on the percentage increase, stating that the City's reported
increase is not a singular percentage, but is actually a range of percentage increases as
water usage decreases.
Staff advises that the referenced report, F-2007-07 2007 Municipal Utility Budget, does
provide individual percentage comparisons for the fixed monthly charge and the volumetric
charge. The report also provides a percentage comparison for the combined charges
based on 30 cubic meters of water used per month. The amount of 30~ms was chosen by
Staff to represent the average monthly usage of water; a factor used by other
municipalities for comparison purposes. In Staff's report CPS-2007-02, Staff recommends
that a full review of water/sewer rates be undertaken. A review would address the
concerns that Mr. Bielawski has raised, especially the need to inform ratepayers of the
impact of increasing rates in relation to variant water and sewer usage.
7. Conclusion -The factor used to calculate weighted
meter is unrealistic and thus totally flawed
During the meetings with Mr. Bielawski, his comments cited that the current weighting for
meters is flawed. His comments were directed at the use of the AWWA standards for
differentiating between the sizes of meters. As stated earlier, Staff advises that the size
of a water meter relates to the size of the demand flow for water provided to the user.
Some users require a larger demand flow than others. Both the water and sanitary sewer
systems are engineered to accommodate the variant sizes of both water flows and sewer
usage. Staff advises that the AWWA standard is recognized and approved in
municipalities throughout Ontario, Canada and the United States. As this standard is
recognized and used, Staff believes it provides the appropriate factors by which to weight
the different sizes of meters. In Staff's report CPS-2007-02, Staff recommends that a full
review ofwater/sewer rates be undertaken. A review would address the concerns that Mr.
Bielawski has raised with regard to the current practice of using the AWWA standard.
September 24, 2007 - 7 - CPS-2007-03
Conclusion
Mr. Bielawski has provided significant concerns in his deputation to the Corporate Services
Committee, as presented in his document "Water Rate Study", and directly to Councillors
and Staff over the past year. Although Staff has provided some commentary on Mr.
Bielawski's conclusions, the need for a water and sewer rate review is only made more
apparent. Staff and Mr. Bielawski concur that there are different methods to structure
water and sewer rates. A water and sewer rate review would not only address the
concerns raised by Mr. Bielawski but also the concerns of other residential, commercial,
industrial and institutional ratepayers. The reviewwould evaluate the different methods for
structuring rates as well as focus on other challenging issues. The review would provide
options for the City to address the issues, apply the current legislation to the City's rate
structure, and compare the advantages and disadvantages of applicable rate structures.
As the Committee was interested in the Loudon report and the conclusions raised by Mr.
Bielawski, the rate review was postponed. The Committee's further consideration of the
proposal from BMA Consulting Inc. as presented in the earlier report CPS-2007-02, is
appreciated.
Recommended by:
K._E. Burden, Acting Executive Director of Corporate Services
Respectfully submitted: ~. ~ZJ c~
n
acDonald, Chief Administrative Officer
Attach.
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
CITY OF NIAGARA FALLS
STUDY OF WATER & SEWER RATES FOLLOWING METERING
SYNOPSIS
This report reviews the current water and sewer rates and makes recommendations on future
rates to be implemented as a result of the metering program. The level of the rates is based on
preliminary budget data and should be reviewed and revised based on final budget data once it
is available. The following summarizes the report findings:
• Metering Program -The City has completed the metering of approximately 22,500
customers billed flat rates. Most of these are residential, but there are a few commercial
customers.
• Current Situation -There are approximately 3,100 customers currently billed metered
rates. The current rates are two-part with a fixed charge variable by meter size and a
volumetric charge with 6 declining rate blocks.
Proposed Two Part Rates -The proposed rates are also two-part with a fixed charge
variable by meter size and a volumetric charge. The proposed volumetric charge is single
block -there are no reduced volumetric rates for large volume users. This proposed
change to a single rate block is recommended due to the fact that water is purchased
wholesale from the Region at a constant rate for all usage and as a result there are no
large-volume savings realized by the City that could be passed on to large volume users.
Water/Sewer Combined -The sewer charges are currently billed as a 150% surcharge on
the water bill. The City 2000 water and sewer budgets are prepared with the water and
sanitary sewer costs combined. As a result, a single combined water and sewer rate has
been calculated. This approach is increasingly used as it simplifies the customer billing
and improves the flexibility of financially managing the water and sewer utilities. Toronto
has followed this approach for years.
Recommended Volumetric Rate Option -Two options are provided for the volumetric
rates. Option 1 links the retail volumetric charge to the Region's volumetric charges. The
volumetric charge would recover about two-thirds of the user rate revenues. Option 1 is
recommended since it minimizes revenue uncertainty while maintaining a high enough
proportion of charges based on volume to encourage conservation. Option 2 is provided as
an alternative. It allocates 80% of the costs to the volumetric charge, which would
increase the conservation element, would allow more control by customer's of their water
bills, but would decrease revenue security during years with low seasonal use.
Recommended Service Charge Option -Two service charge alternatives are provided.
Alternative A is a single service charge for all customers. It has the advantage of
simplicity. Alternative B has service charges variable by meter size. This is recommended
as it more closely allocates the costs to each customer. This is the same approach as is
currently used, except that the service charges proposed are higher for larger sized meters
than those currently applied.
NFRateReport.doc 1 Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
• Implementation - An implementation plan is suggested in Section 8 of the detailed
report.
Proposed 2001 WaterlSewer Rates (monthly) -Recommended in Bold Italics
Option 1
(Volumetric rate recovers
Regional charges) Option 2
(Volumetric rate
recovers 80% of costs)
Volumetric Rates ($/cubic metre) $1.309 $1.549
Service Charges
- A -Single Uniform Charge $26.235 $16.182
- B -Charge Variable by Meter Size
15 mm $22.54 $13.90
18 mm ,$22.54 $13.90
25 mm $22.54 $13.90
37 mm $56.35 $34.75
50 mm $135.23 $83.41
75 mm $270.46 $166.82
100 mm $495.84 $305.83
150 mm $946.61 $583.85
200 mm $1,690.37 $1,042.59
NFRateReport.doc 2 Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final
CITY OF NIAGARA FALLS
STUDY OF WATER & SEWER RATES FOLLOWING METERING
DETAILED REPORT
INTRODUCTION
During 1999 and 2000, the City of Niagara Falls has carried out a program of installing meters
on the water services to all customers. Formerly only non-residential customers were metered.
The metering program mostly is for single family dwellings, but has had the benefit of
identifying some other larger customers that escaped metering in the past and that are also
now being metered.
A previous study was carried out of water rates following meteringl that provided preliminary
rates recommendations. That study recommended two-part water rates with a single
volumetric charge and a service charge variable by meter size. The method used was as set out
in the Canadian Water & Wastewater Association Municipal Water Rate Manual.
In the following study, the estimate of water consumption following metering has been
refined based on preliminary readings taken on the newly metered customers. Expenditure
data is also based on preliminary 2001 budgets.-
2 CURRENT WATER & SEWER RATES
The 2000 water and sewer rates are as follows:
Exhibit 1 2000 Volumetric Water User Rates (quarterly basis)
Block limits
(gallons/quarter) Industrial
$/000 gallons Commercial & Residential
$/000 gallons
0 to 99,000 $3.13 $3.52
100,000 to 199,000 $2.74 $3.13
200,000 to 299,000 $2.35 $2.74
300,000 to 499,000 $2.20 $2.35
500,000 to 699,000 $2.04 $2.20
700,000 & over $1.87 $2.04
~ City of Niagara Falls Residential Water Metering Study Financial Analysis - prepared by Fortin & Loudon in
conjunction with Acres & Associated Limited -August 1998
NFRateReport.doc 3 Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
Note that some larger metered customers are billed monthly rather than the quarterly basis
used for most metered customers.
Exhibit 2 2000 Service & Minimum Charges (quarterly)
Meter Size
Service Charge Minimum Bill
(millimetres) ($/quarter) Charge
($/quarter) Nominal Volume Allowance
(m3 /quarter) -see note
15 mm $1.25 $43.00 11,000
18 mm $2.00 $57.00 15,000
25 mm $2.50 $95.00 26,000
37 mm $3.00 $155.00 44,000
50 mm $4.00 $231.00 66,000
75 mm $7.50 $385.00 125,000
100 mm $12.00 $768.00 285,000
150 mm $30.00 $1,158.00 529,000
200 mm $50.00 $1,932.00 967,000
NOTE: The minimum consumption allowance volume is approximate only. The dollar
volume is applied rather than the published volume.
The metered rates are mostly applied every three months (quarterly). The flat rate charge is
billed every four months at $82.46.
Sewer charges are levied on the water bill as a surcharge. The sewer surcharge is currently
150% of the water charge.
3 CUSTOMERS
By the time the metering program is complete, about 22,500 unmetered customers are
expected to be converted to meters. When added to the 3,100 customers previously metered,
this will bring the total number of meters to the following:
NFRateReport.doc 4 Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
Exhibit 3 Number of Metered Customers by 2001
Meter Size
(millimetres) Number
15 mm 24,250
18 mm 387
25 mm 343
37 mm 221
50 mm 291
75 mm 52
100 mm 42
150 mm 1 g
200 mm 3
Total 25,607
4 CONSUMPTION
Wholesale -The City pays wholesale charges for the volume of water supplied and the
sewage treated by the Region of Niagara, which is responsible for this service. The City only
has jurisdiction over the retail operation of distributing water and collecting sewage. The
Region charges the same wholesale rates year-round and to all of the area municipalities. The
wholesale rates over the past 3 years are as shown below in Exhibit 4.
Exhibit 4 Niagara Region Water & Sewer Charges ($Im3)
Water Sewer
1998 $0.275 $0.465
1999 $0.291 $0.479
2000 $0.300 $0.489
The 1999 water and sewage volumes which the Region billed the City are summarized in
Exhibit 5 below:
NFRateReport.doc $ Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
Exhibit 5 1999 Water & Sewage Volumes Billed to Niagara Falls by Region (m3)
Month Water Sewer
January 1,269,279 1,821,812
February 1,122,577 1,754,075
March 1,233,599 1,836,082
April 1,274,006 1,738,828
May 1,746,304 1,616,411
June 2,242,640 1,582,608
July 2,820,323 1,723,472
August 1,849,745 1,814,831
September 1,661,525 1,666,689
October 1,441,157 1,697,414
November 1,297,101 1,739,527
December 1,315,656 1,747,952
Total 19,273,912 20,739,701
The monthly-water and sewage flows billed by the Region starting in 1998 and up to
September 2000 are graphed in Exhibit 6. This graphically illustrates the normal seasonality
of the water purchases. Monthly water flows in the summer of 1999 reached almost three
times the spring level. There was much less of an increase in 2000, a wet year.
The sewage flows, on the other hand, show less variation, with only a modest decrease in the
summer and occasional higher flows in the spring and fall, no doubt due to inflow and
infiltration. There are sewage flow variations in the summer of 2000 are not consistent with
historical trends, but could relate to the dates that the meters were read.
Consumption by Currently Metered Customers -There are about 3,100 customers
currently charged metered rates. Most are billed quarterly, but the larger customers are billed
monthly. Their consumption for the past 2 years is as shown in Exhibit 7.
NFRateReport.doc 6 Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
Exhibit 7 1998 & 1999 Metered Customer Consumption (m3)
1998 1999
Quarterly metered 7,172,986 6,736, 805
Monthly metered 671,582 699,483
Total metered 7,844,568 7,436,288
Pumpage 19,541,564 19,646,127
Unmetered use 11,696,996 12,209,839
Unmetered Use - To narrow down the likely range of unit consumption by the newly
metered customers, meter readings were specially taken in May and June of all meters
installed to that point. There were 17,823 meters read. There were 105 customers with meter
reading dates errors. There were some very large meter readings -the largest 10% or 178
customers were as a result treated separately. The results of the reading program are
summarized in Exhibit 8.
Exhibit 8 Newly Metered Customer Consumption Results Summary to June 2000
Description Number of
Customers Average Total Monthly
Consumption
(m3 /month) Unit Consumption
(m3/month/custorner)
Date errors (note 1) 49 N/a N/a
0 reading 56 0 N/a
Normal residential 17,540 431,865 24.6
Larger customers 178 38,158 214.4
Normal + Larger 17,648 470,023 26.5
Note: The reading dates were not feasible such as1980 installation or installation date after the
date of the latest meter reading
The customer name and address, meter serial number, meter installation and reading dates and
volumes were input in Excel spreadsheet format. Meter installation was spread out from about
May 1999 until the date of the special readings. The average monthly usage for all customers
was 26.5 m3/month. Much of this consumption was not in the summer. Only about 20% of the
customers had been metered by the end of last summer.
The customers are mostly residential, but there are some non-residential customers including
some larger users. If the largest 1 % of users is removed from the calculation, the average use
drops to 24.5 m3/month. 99% of the customers used less than 90 rn3/month. Usage by the top
1% ranged up to in excess of 1,000 m3/month.
NFRateReport.doc '] Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
Exhibit 9 illustrates the average consumption by customers and includes the variance in level
depending on how long customers have been metered. Customers that have been metered the
longest include both summer and winter usage. These are plotted on the right hand side of the
graph. The average monthly consumption level of customers that were metered prior to July
1999 was about 29.5 m3/month. These customers were metered for a full year. But as
customers are progressively metered and customers with only winter consumption are
included in the average, the level drops. This can be seen by as the vertical bars get shorter
during the winter since usage by these customers only includes winter usage.
Based on the initial consumption levels, and recognizing the fact that summer usage is much
higher than winter, it seems feasible that the average usage for these newly metered customers
might well be about 28 m3/month.
Unmetered use is a combination of unaccounted for water (UFW) losses such as watermain
leakage, hydrant flushing, sewer flushing etc plus water used by unmetered customers (i.e. flat
rate customers). Exhibit 10 illustrates possible combinations of UFW and unmetered customer
consumption in 1998 and 1999 based on 22,500 unmetered customers. An average level of 28
m3 /month (customer over a full year is equivalent to 23%UFW. This is relatively high, but
not unreasonable compared to previous staff estimates of about 19%UFW. Full meter reading
will clarify this calculation. If the top 1 % of newly metered customers are excluded, then this
is equivalent to about 26 m3 /month /customer for residential customers. In the original
metering financial study2 it was concluded that residential usage by unmetered residential
customer is about 27 m3 /month /customer. That conclusion was based on other municipalities
as well as a small sample of metered flat rate customers in the City.
Impact of Metering -Experience with the impact of metering varies. There are many
influences, primarily cost level and amount of discretionary use (primarily summer use).
Often there is an initial impact followed by a rebound, since the water is not really high
compared to other utilities. Water and sewer combined is less than cable television charges.
A typical residential customer is likely to use in the range of 18 to 22 m3/month, based on
experience in other similar Ontario municipalities. Excluding the 1 % largest users in the
newly metered group, the likely consumption now is about 26 m3/month. According to
research by Environment Canada3 reduction in water use doe to metering is likely to be 30%
or more. A drop to 20 m3/month after metering would represent a decrease from 26 m3/month
of 23%. Combining this information, it is assumed that consumption will drop by 25% in the
first year. The level of consumption following metering is calculated in Exhibit 12.
5 Financial
The 2001 draft water and sewer budget has been prepared with water and sewer costs
combined. In the past these costs have been kept separate and the water and sewer tariffs set
z City of Niagara Falls Residential Water Metering Study Financial Analysis -Draft Discussion Paper -Fortin &
Loudon in association with Acres & Associated Ltd. -August 1998 page 14
3 Guidelines for Municipal Water Pricing -Environment Canada - McNeill and Tate -page 7
NFRateReport.doc $ Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
separately. There is a trend in Ontario towards issuing a single combined water and sewer
charge -see Section 6 below.
The water and sewer budgets are summarized in Exhibit 11.
6 Tariff Calculations
The current water tariffs are two-part with both fixed (variable by meter size) and volumetric
(decreasing block). The following is recommended:
That water and sewer tariffs be billed as one combined rate. This is done in several
municipalities in Ontario, the largest being the City of Toronto. This was also the practice
followed in many of the six local municipalities in Metropolitan Toronto previously. The
Town of Markham has also followed this practice for many years. The Town of Markham
is similar to the City of Niagara Falls with respect to their being the retail provider of
water and sewer services inside the Region of York which bills for both wholesale
services based on volume (both water and sewer are billed based on water volumes at the
wholesale level, however). This year the Town of Newmarket has also switched to a
combined water /sewer charge. The use of a combined charge provides much greater
flexibility with regard to budgeting these services and allowing for annual revenue
fluctuations.
• Eliminate Declining Block Rates -There is little or no cost justification for declining
block rates in Niagara Falls. There are economies of scale for large water users, but these
occur mostly in the water production area, which is a Regional responsibility. It does not
affect the City's costs.
The following comments are also added regarding the water and sewer rates:
Note that the use of water consumption as a basis for billing sewer charges is common in
Ontario. This is the most feasible way of approaching user pay for recovering sewer costs.
Water meter readings are a surrogate for measuring sewage flows. During 1999, total
Niagara Falls sewage flows billed by the Region were close to total water flows, only
about 6% higher and in 1998 sewage flows were about 10% higher than water flows. In
Niagara Falls, as in most other municipalities, customer metered water flows are used in
the calculation of a customer's sewage charges. Overall this is a fair way of achieving user
pay for the sewage costs. It is meant to allocate sewer costs in proportion to each
customer's use of the system. Although there are flow differentials between water and
sewer systems due to seasonal water use in the summer and for sewer due to inflow and
infiltration, these variations more or less even out over the year. The use of water
consumption is a reasonable surrogate for sewage flows and is the only practical way of
achieving user pay for sanitary sewer charges.
• Seasonal Charges -Note that water consumption normally has a very high seasonal
component in Niagara Falls. Water consumption in the summers of 1998 and 1999
exhibited very high increases -see Exhibit 6. The wet summer of 2000 showed very little
increase. Since the cost of meeting summer peaks occurs at the Regional level, there is
NFRateReport.doc 9 Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
little justification for the City to consider seasonal rates. This may have to be reconsidered
if the Region decides to utilize some form of seasonal rates to moderate the high summer
peak water flows.
The combined water and sewer rates are calculated in Exhibit 12. Two options are provided:
• Option 1 -Recover Regional Volumetric Charges from Volumetric Rate -This approach
is based on revenue security plus relating obviously variable charges to the volumetric rate
and largely fixed charges to the fixed service charge. It is a fair approach. Unfortunately,
the conservation aspect of metering is weakened since only about two-thirds of costs in
the volumetric rate.
• Option 2 -Recover 80% of Costs in the Volumetric Rate -This alternative would recover
all of the Regional costs in the volumetric rate, plus some of the City costs. It would have
a higher conservation element, which may translate into reduced usage and reduced
Regional charges as a result.
The service charge is calculated both as (A) a single charge for all customers and (B) one
variable by meter size.
The volumetric rates and service charges are provided in Exhibit 12.
7 Impact
The impact of the proposed rates compared to the current rates is provided in Exhibit 13.
For flat rate customers, those that use below average volumes pay less and above-average
users pay more. The average customer pays slightly less.
For currently metered customers, most pay more due to the elimination of the volume
discounts.
8 Implementation
The following suggestions for implementation are made.
• There should be public notices in advance of the impending rates and how they might
affect customers.
• The bill should include a phone number where customers can ask questions about their
bill.
• The new tariffs should not be first applied during the summer season as the differential
from the flat rate charges will highest at that time.
• The billing staff should be prepared to answer questions about why customers' bills have
changed. They should also be helpful in suggesting ways to reduce usage.
NFRateReport.doc 10 Loudon & Fortin
November 2000
City of Niagara Falls
Study of Water & Sewer Rates Following Metering Final Report
• Also there will be high residential water users who will not be happy with paying for what
they use. It must be emphasized that this is now a user pay system and that customers
have a measure of control over the size of their bill.
• For larger customers, notification should go out in advance of their expected increase.
This will often avoid adverse reaction once the bills are received.
• Some municipalities choose to initially send out demonstration bills to illustrate the
potential impact of the metered rate charges, so that customers can adjust usage before the
real billings start.
NFRateReport.doc 11 Loudon & Fortin
November 2000
September 24, 2007
~~
Niagara~alls
Councillor Victor Pietrangelo, Chair
and Members of the Corporate Services Committee
City of Niagara Falls, Ontario
Members:
Re: F-2007-36
2008 Budgets
RECOMMENDATION:
For the information of the Corporate Services Committee.
BACKGROUND:
F-2007-36
City staff has commenced preparation of the 2008 Operating, Utility and Capital Budgets.
Finance staff has prepared a timetable that includes all of these action steps. The
timetable is as follows:
DEPUTATIONS AND SCHEDULE OF MEETINGS
September 24, 2007 Corporate Services Committee:
-Financial Policies Introduction
- Overview and Council direction for 2008
October 15, 2007 Corporate Services Committee:
-Operating and Utility Budget introduction
- PSAB introduction
October 29, 2007 Corporate Services Committee:
-All deputations
November 12, 2007 Corporate Services Committee:
- Hand out Operating and Utility Budget Binders
-Capital Budget introduction, overview and Council direction for 2008
November 25, 2007 Corporate Services Committee:
-First General Purposes Budget Discussion
- First Municipal Utility Budget Discussion
December 10, 2007 Corporate Services Committee:
- Second General Purposes Budget Discussion
- Second Municipal Utility Budget Discussion
- First Capital Budget Discussion
Working Together to Serve Our Community corporate services Department
#, Finance
G:..: I.
~~~'
.p~.a-;
~f:' 7~Li ~ .!, a •~ r ~.
-2-
January 14, 2008 Corporate Services Committee:
- Third General Purposes Budget Discussion
-Third Municipal Utility Budget Discussion
-Second Capital Budget Discussion
January 28, 2008 Corporate Services Committee:
-Approval of General Purposes, Municipal Utility and Capital Budgets
The Budget preparation includes many action steps, including staff review and input,
Council review, input and discussion, as well as deputations from the appropriate
stakeholders. As was done last year, individual directors will present their divisional
budgets to Council.
For the 2008 Budget year, a number of key factors will directly impact the final outcome.
In regards to City expenditures, inflationary pressure will impact utilities and purchases
differently. The current price increases as measured by CPI is 2.2%, but as stated,
inflationary pressure will vary on expenditure source In addition, Staff are negotiating with
both the COPE workers and the City's Professional Firefighters' Association. Due to prior
year's decision, new debt servicing will impact the 2008 Budget.
In regards to City revenues, property taxation will continue to be the principal source. In
2008, MPAC will be performing re-assessments, however change in valuations will not
impact revenues until the 2009 Budget year. Staff is currently reviewing all building and
planning fees with a new rate structure will be in place for 2008.
As in prior years, staff requests that Council provide direction in preparation of the budget.
Specifically, is it Council's direction maintain existing service levels? The Chief
Administrative Officer will provide a brief overview of key financial information that will
factor into the determination of the 2008 Budgets.
Recommended by:
Todd Harrisorti!; Acting Director of Financial Services
Approved by: ~~ ~ °~%%~'~~.'
K. E~.~Irden, Acting Executive Director of Corporate Services
Respectfully submitted: ~`~'~ ~`~'~ ~,~~
Job°r~MacDonald, Chief Administrative
The City of Niagara Falls, Ontario
Resolution
No.
Moved by Councillor
Seconded by Councillor
WHEREAS all meetings of Council are to be open to the public; and
WHEREAS the only time a meeting or part of a meeting maybe closed to the public if the subject
matter falls under one of the exceptions under s. 239(2) of the Municipal Act, 2001.
THEREFORE BE IT RESOLVED THAT on September 24t'', Niagara Falls Council will go into
a closed meeting to consider a matter that falls under the subject matter of 239(2)(c) of the
Municipal Act, 2001, on a proposed or pending acquisition or disposition of land,
AND The Seal of the Corporation be hereto affixed.
DEAN IORFIDA R. T. (TED) SALCI
CITY CLERK MAYOR