2019 Operating & Capital Budget 2020 – 2028 Capital Budget and Forecast December 10, 2018 Presented by: Keshwer Patel Commissioner, Corporate Services, Chief Financial Officer & Treasurer
What’s Happening in Waterloo? 2
What’s Happening in Waterloo & our Region? 3
Delivering on Council’s Vision Help us define Waterloo’s priorities for the next 4 years. Questionnaire available till Dec 21, 2018 at engagewr.ca/waterloo 4
Our Share of the Pie Based on the data from the Fraser Institute, the average income in 2018, of a family in Ontario is $121,649. On this income, the family would pay $52,696 in taxes for an effective tax rate of 43.3%. https://www.fraserinstitute.org/sites/default/fil es/tax-freedom-day-2018.pdf This includes income tax, payroll tax, sales tax, property tax, fuel City of Waterloo share = 2.9% or tax, motor vehicle license tax 2.9 cents for every tax $ ……. 5
Our Share of the Property Tax Bill 6
Tax Funded Services ($74.8 million) PARKS, RECREATION, OPERATING TRANSFERS TO FIRE RESCUE & MUNICIPAL COMMUNITY & CULTURE CAPITAL/RESERVES ENFORCEMENT $13.6 million $12.5 million $19.3 million Management of parks & open spaces, fields Transfer of operating funding to reserves Prevention and emergency response and trails to support outdoor recreation. The and reserve funds for capital rehabilitation services that enhance public safety & development and promotion of programs for and new investments in city infrastructure. maintain community standards through community activities and ensure that culture & education, mediation and enforcement. heritage are nurtured. TRANSPORTATION & FACILITY DESIGN CIVIC WATERLOO PUBLIC DEVELOPMENT SERVICES & MANAGEMENT LIBRARY ADMINISTRATION $5.6 million $7.9 million $8.8 million $6.9 million Supports and fulfills literacy needs Ensure the smooth, safe and Includes the city’s transportation network Support services for program of the community, including digital reliable operations of all city- which is made up of public parking, delivery such as human literacy and provides crucial owned buildings, vehicles and traffic operations and winter control. resources, finance, legislative settlement services to newcomers . equipment. Maintenance of the The provision of engineering and services, information structural, architectural, management services to other divisions, technology, procurement, mechanical, electrical and security the establishment of development communications & legal . service and systems of all city- regulations and the review and owned properties. processing of urban planning 7 applications. Note: some numbers may not add due to rounding
Enterprise Funded Services ($78.1 million) BUILDING CEMETERY CITY UTILITIES STANDARDS SERVICES $66.6 million $1.8 million $3.2 million Distribution of safe and reliable drinking water, Cemetery services including the operation Ensure safe and healthy buildings collection of sanitary wastewater and of a crematorium and cemetery grounds through the Building Code Act. stormwater management services. maintenance . RENTAL COMPREHENSIVE PARKING HOUSING BUSINESS LICENSING SERVICES LICENSING $0.4 million $1.5 million $1.6 million Programs that regulate businesses The City of Waterloo's parking regulations are Programs that regulate rentals for safety for safety and compliance. designed to keep you safe while effectively and compliance. utilizing our on-street parking spaces. Note : Not included on this slide are smaller enterprises such as local area health networks, regional road recoveries and internal fleet operations which total $3.0 million. 8
City of Waterloo 2019 Proposed Gross Operating Budget Where Funding Comes From Where Funding Goes $191.9 million $191.9 million Waterloo Public Facility Design and Enterprises Library, Management, (Revenues & Transfer $5.6, 3% $9.8, 5% Transportation and From Reserves), Development $78.1, 41% Services, $11.7, 6% Enterprises (Expenses & Operating Transfers Transfer to to Capital/Reserves, Reserves), $13.0, 7% $78.1, 41% Fire Rescue and Municipal Enforcement, $21.4, 11% User Fees & Other Revenues, $39.1, 20% Parks, Recreation, Community and Net Property Tax, Culture, $74.8, 39% $24.3, 13% Civic Administration, $28.1, 14% 9
Investing in Our Strategic Priorities in 2019 2019 Proposed Operating & Capital Budget Expenses - Strategic Plan Link Summary Strategic Plan Link Operating Budget ($) Capital Budget ($) 2019 Total ($) Infrastructure renewal 1,099,655 57,916,635 59,016,290 Corporate excellence 667,209 3,038,999 3,706,208 Economic development 299,364 10,639,135 10,938,499 Strong community 397,837 30,348,511 30,746,348 Multi-modal transportation 13,000 2,614,088 2,627,088 Environmental leadership 1,716,368 1,059,075 2,775,443 2019 Total 4,193,433 105,616,443 109,809,876 10
2019 Budget – “A Balanced Approach” Our objective is clear – continue to The proposed budget deliver services to support a strong, reflects the priorities of healthy green and vibrant Waterloo the community, within the financial capacity available from decisions of council, the community. delivers on current THE 2019 BUDGET services, addresses resource needs for WILL HELP US growth areas and has a limited number of new services and the GET THERE. resources needed to keep the city in a stable 1 efficiently 2 infrastructure 3 the future 4 financial position. Deliver services Maintain Invest in Sustainability effectively &
The 2019 Proposed Tax Increase Broken Down by Budget Category 2019 Proposed 2019 Proposed Budget Category Property Tax Net ($) Property Tax (%) Base Budget 814,202 1.1% Operating Impact of Capital & Growth 400,335 0.5% Service Level Changes 188,891 0.3% TOTAL 1,403,428 1.9% For base budget change + operating impact of capital and growth , the proposed increase is 1.6%. 1.3% (1.7% actual) • Rolling average CPIX to August is • Rolling average CPIX to October is 1.4% • Actual CPIX to October is 1.6% 12
Investing in Our Tax Based Services to Citizens Viewing Through the Lens of Our Major Service Delivery Areas 13
Our History of Tax Increases 2011- 2018 Using CPIX as the guideline, this chart shows the tax increase for base budget & operating impact of capital in relation to average inflation. 14
Our History of Tax Increases 2011- 2018 For 2011 to 13, our tax increase has been close to average CPIx inflation; For 2014 & 2015, our tax increase has been well below this inflation level. The years 2016, 17 & 18 have been a catch up. 15
Where are the Inflationary Indices Trending Now? 16
Our Capital Investment for 2019 - 2028 2019-2028 Projected Capital Expenditures by Strategic Priority Area 2019 2020-2028 Total % of 2020- % of % of 2019 2028 Total # of Budget # of Budget # of Budget Criteria Projects Total $ Dollars Projects Total $ Dollars Projects Total $ Dollars INFRASTRUCTURE RENEWAL 97 $ 57,916,635 55% 164 $ 333,075,121 61% 261 $ 390,991,756 60% CORPORATE EXCELLENCE 20 $ 3,038,999 3% 26 $ 27,763,974 5% 46 $ 30,802,973 5% ECONOMIC DEVELOPMENT 8 $ 10,639,135 10% 18 $ 44,955,632 8% 26 $ 55,594,767 8% STRONG COMMUNITY 30 $ 30,348,511 29% 68 $ 108,358,675 20% 98 $ 138,707,186 21% MULTI-MODAL TRANSPORTATION 12 $ 2,614,088 2% 19 $ 21,030,234 4% 31 $ 23,644,322 4% ENVIRONMENTAL LEADERSHIP 9 $ 1,059,074 1% 16 $ 13,966,297 3% 25 $ 15,025,371 2% Total Capital Budget 176 $ 105,616,443 100% 311 $ 549,149,932 100% 487 $ 654,766,375 100% 17
Our 2019 Proposed Capital Budget Prioritized with our AMP 18
Our 2019 Proposed Capital Budget By Service Area 19
What Does This Mean For Our Reserves Funding The Capital Program? 20
Our Tangible Capital Assets as at year end 2017 ( $1.1 Billion) 21
History Of Public Infrastructure Ownership Municipalities have 67% of the assets but 8% - 9% of the tax revenues 22
Addressing the Infrastructure Deficit 23
Asset Management Plan (AMP) • In November 2016, Asset Management Plan developed, integrating various existing data sets on asset condition and life cycle. • Key Findings: -Shortfall of $14 - $17 million annually on tax funded capital infrastructure -Shortfall of $6 million annually on city utility infrastructure -Need to develop a sustainable funding strategy 24
Asset Management Plan (AMP) Reference: Report IPPW2016-099 dated Nov 14, 2016 25
Asset Management Plan (AMP) Reference: Report IPPW2016-099 dated Nov 14, 2016 26
Long Term Financial Plan (LTFP) - Long Term Financial Plan developed in 2018 - Ref CORP2018-011 to FSP on April 16, 2018 - Took a holistic view of financial needs of city including infrastructure, operational and anticipated growth needs - Financial model with a 25 year outlook developed. - Financial Model was integrated with the data from the Asset Management Plan developed in the prior year. - Model factored in anticipated growth related capital (eg fire station), operating impact of capital projects, and inflationary trends and resulting financial requirements. 27
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