2020 Capital Budget Council Chambers November 6, 2019 1
Presentation Agenda 1) Overview: Inputs & Drivers 2) Budget Program Highlights 3) Risks & Opportunities 4) Next Steps 5) Presentation Questions 6) Capital Project Worksheets Review 2
1) Overview: Inputs & Drivers • Year round process with many inputs & ongoing feedback. • “Canadian municipalities own, manage and build over 60% of this country’s infrastructure, but they do it with less than 10% of the tax base” [Municipal Information Network, Oct/18] . • Historical asset cost values of $334M: • Land $14.1M Vehicles $9.2M • Land improvements $19.2M Linear $242.6M • Buildings $29.4M Machinery & equip $19.9M • Extensive network of core infrastructure that was recently estimated to have a replacement cost over $1B. 3 • e.g., 721km paved lanes with current replacement value >$350M.
1) Overview: Inputs & Drivers • Council’s 2018-2022 Corporate Strategic Plan • Asset Management Plan (AMP) [IS-21-2019] • 2019 AMP by GM BluePlan received in July (priority to roads, bridges, water & wastewater) • Required by Province for grant funding • Identifies long term requirements over asset life cycle • Proposed financial strategy for sustaining investment: • Inflationary: $214,140 2020 increase to existing contributions • Strategic: $200,000 increase to target gaps (CBC-01-2020 Table 3) 4 • Reserve Policy and targets
1) Overview: Inputs & Drivers • Master Plans: departmental priorities to replace existing assets • IS-15-2019 Wastewater MP • IS-14-2018 Facility Condition Assessment • IS-09-2018 Bridge & Culvert Assessment • IS-17-2017 Water MP • DC Study: guides new or growth asset development • 2020 Capital based on 2018 DC Study; Study expresses Council’s intent to incorporate into future budgets • Consultation with external partners and agencies 5
2) Budget Program Highlights 2020 Cost = $18.2M Request Parks & Facilities Water Wastewater 10% 10% 10% 59 Projects Fleet Storms & drains Corporate & 1% 9% Community Services 1% Planning & Dev. 10% Roads, bridges, sidewalks & transit Fire & Emergency 32% Services 6 19%
2) Budget Program Highlights Existing vs. Growth Existing Assets $15.8M or 87% for replacement or rehabilitation, including: • $ 3,350,000 18.4% Fire Station #4 amalgamation • $ 1,519,000 8.3% Dead end watermain replacement • $ 1,325,000 7.3% Bridge & culvert replacement • $ 1,300,000 7.1% Road resurfacing program 7
2) Budget Program Highlights Existing vs. Growth Growth Assets $2.5M (13%) for new or growth, including: • $ 448,485 2.4% Schooley Rd storm sewer & outlet • $ 385,000 2.1% Transit Fare tech & hardware upgrades • $ 300,000 1.6% Spears Rd subdivision park • $ 250,000 1.4% Crystal Ridge Park improvements 8
2) Budget Program Highlights Financing = $18.2M DC 12% Federal Gas Tax 6% Debentures 8% Town Reserves Grants 63% 7% Other 9 4%
2) Budget Program Highlights Financing Reserves: $11.5M or 63% • Available Capital Reserve balances of approx. $16.4M. • Total annual contribution of $10.9M from Levy and W&WW. • Proposed 2020 Capital Budget and Forecasts relies on inflationary increases but not strategic increases. 10
2) Budget Program Highlights Financing Capital Reserve contributions (in millions) 12 Millions 10 8 Levy [Core] Levy [Non-core] 6 Water Wastewater 4 Total 2 0 11 2015 2016 2017 2018 2019 2020*
2) Budget Program Highlights Financing Forecasts Capital Reserve balances (in millions) 18 Millions 16 14 12 Levy [Core] 10 Levy [Non-core] 8 Water Wastewater 6 4 2 0 12 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
2) Budget Program Highlights Financing Debt: None issued in 2020 • $1.4M expected mid-2021 re: Fire Station #4 amalgamation • $21K in 2021 interest; $158K/yr thereafter (principal & interest) • 2019 year-end balance: $6.33M • 2020 principal payments: $809K • 2020 interest payments: $190K 13
2) Budget Program Highlights Financing Forecasts 8 Millions Debt Year-end Balances 7 6 Water 5 Wastewater 4 Roads Storm 3 Fire 2 1 0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 14 Debt charges <5% Town revenue = “low risk” (25% limit)
2) Budget Program Highlights Financing Gas Tax Funding: $1.1M or 6% ($931,626/yr commitment) • $1,126,250 for Bridges & culverts Grants: $1.4M or 7% • $1,076,740 OCIF Formula-based for Road resurfacing • $282,320 ICIP Transit for Transit fare technology Development Charges (DC): $2.1M or 11% • Projects as identified in the 2018 DC Study Other contributions: $773K or 4% 15 • Land sales ($400K), landowners ($323K), meter sales ($50K)
2) Budget Program Highlights 10-year Forecast 20 Millions 18 16 IS: Fleet IS: Parks & Facilities 14 IS: Water 12 IS: Wastewater IS: Storms & Drains 10 IS: Bridges & Culverts 8 IS: Roads FES 6 PDS 4 CCS 2 0 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 16 Average annual Capital Program is $13.8M (2020 to 2030)
2) Budget Program Highlights Approvals Preliminary approval: • $9,824,000 (Appendix “1”) • By-law: Dec 9/19 • Reserve funding currently available General approval: • $8,424,785 (Appendix “2”) • By-law: Feb 10/20 (or Mar 16/20) • Reserve funding requires 2020 levy contributions 17
3) Risks • Operating budget impact : $208,308/yr; 0.8% of Levy (App “3”). Asset growth has staffing and management pressures. • Parkland & DCs : Rely on estimated external revenues. • Federal Gas Tax : 2019 5-year agreement ends 2023. • AMP : Updated to include recent master plan studies. Revised financing strategy to address storm, water & wastewater gaps. • Unusual or extraordinary events : Recent windstorm and flooding demonstrates environmental risks to assets. 18
3) Opportunities • Grant funding : External Federal, Provincial & Region funding (e.g., ICIP applications, OCIF Formula-based). • Early budget approval : May generate greater interest and assist to minimize costs. • Debt : Low reliance on debt provides capacity for new/growth assets as needs arise or other opportunities emerge. • Operating budget impact : Some replaced assets may result in lower costs (e.g., lower energy & maintenance costs). 19
4) Next Steps Capital Budget: • Dec 9 By-law approval (Appendix 1 “Preliminary”) • Feb 10 By-law approval (together with Levy below) Water & Wastewater Budget and User Fees: • Dec 4 W&WW reports/presentations • Jan 20 By-law approval General Levy Budget: • Jan 22 General Levy #1: Town & Library reports/presentations • Jan 29 General Levy #2: Town review (if necessary) 20 • Feb 10 By-law approvals: Levy & Capital (Appendix 2 “General”)
5) Presentation Questions Council Q&A led by Chair Refer to Council Report No. CBC-01-2020 for further information 21
6) Capital Project Worksheets Review Jonathan Janzen Director, Corporate Services 905-871-1600 ext. 2300 jjanzen@forterie.ca 22
CCS: Digital Project 1: IMIS20 IT Computer Hardware Expenditures: 2020: $32,000 2021: 2020 Funding: • IT Equipment Reserve Operating Impact: 2020: $Nil Description: This is part of the Town’s continual program of IT upgrades and replacements Attributes: Expenditure Type: Replacement Est. Completion: Dec 21/20 Binder Tab 4: Pages 4-5
CCS: Digital Project 2: PHON20 Phone Replacement Expenditures: 2020: $17,000 2020 Funding: • IT Equipment Reserve Operating Impact: 2020: $Nil Description: This is part of the Town’s continual program of communication upgrades and replacements. Attributes: Expenditure Type: Replacement Est. Completion: Dec 21/20 Binder Tab 4: Pages 6-7
CCS: Digital Project 3: SERV20 Server & Core Infrastructure Expenditures: 2020: $20,000 2020 Funding: • IT Equipment Reserve Operating Impact: 2020: $Nil Description: Replace corporate wide core infrastructure associated with the Town’s main network. Attributes: Expenditure Type: Replacement Est. Completion: Dec 19/19 Binder Tab 4: Pages 8-9
CCS: Museum Project 4: CABS14 Caboose Repair Expenditures: 2020: $175,000 2020 Funding: • Museum Capital Reserve Operating Impact: 2020: $Nil Description: [COS-02-2019] Repair caboose at FE Railway Museum by replacing the roof, walls, doors & windows; repaint steel components; replace interior components & update wiring. Attributes: Expenditure Type: Rehabilitation Est. Completion: Dec 26/20 Binder Tab 4: Pages 10-11
PDS: Open Space Project 5: CRYS20 Crystal Ridge Park Improvements Phase 3 Expenditures: 2020: $250,000 2020 Funding: • Parkland Reserve • DC ID #3.2.7 Operating Impact: 2020: $16,500 Description: [PDS-20-2017] A variety of key recreational amenities and features for passive and active recreation as recommended by the Crystal Ridge Master Plan. Attributes: Expenditure Type: New Asset Est. Completion: Dec 1/20 Binder Tab 4: Pages 12-14
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