City Council Meeting Agenda Consolidated as of October 21, 2016

Transcription

1 City Council Meeting Agenda Consolidated as of October 21, 2016 Wednesday, October 26, :00 p.m. Council Chambers, Guelph City Hall, 1 Carden Street Please turn off or place on non-audible all electronic devices during the meeting. Please note that an electronic version of this agenda is available on guelph.ca/agendas. Changes to the original agenda have been highlighted. Open Meeting 6:00 p.m. Disclosure of Pecuniary Interest and General Nature Thereof 2017 Non-Tax Supported Operating and Capital Budgets Presentation: Peter Busatto, General Manager, Environmental Services Brad Coutts, General Manager, Court Services Rob Reynen, Chief Building Official Kealy Dedman, General Manager, Engineering and Capital Infrastructure Services (presentation) Delegation: Representative from the Grand River Conservation Authority (presentation) Recommendation That Report No. CS titled 2017 Non-Tax Supported Operating and Capital Budgets be referred to the November 3, 2016 Council Budget meeting. 1. That for Water and Wastewater Services the following be approved: 1. Proposed expansion packages in the net amounts of $449,800 for Water Services and $54,800 for Wastewater Services; Water and Wastewater Services Operating Budgets in the amounts of $30,450,665 and $30,946,448 respectively, inclusive of expansions; Water and Wastewater Services Capital Budgets and Forecasts in the amounts of $180,151,100 and $137,829,500 respectively; 4. A City of Guelph water volume charge of $1.67 per cubic metre effective January 1, 2017 and a wastewater volume charge of $1.80 per cubic metre, effective January 1, 2017; City of Guelph Council Agenda Page 1 of 2

2 5. That the City of Guelph water and wastewater basic service charges remain consistent with 2016 as per the attached schedule "A" effective January 1, 2017; and 6. That the Water Services and Wastewater Services Fees and Services Bylaw be passed. 2. That for Stormwater the following be approved: 1. A 2017 Stormwater Services Operating Budget in the amount of $4,219,000; 2. A 2017 Stormwater Services Capital Budget and Capital Forecasts in the amount of $40,695,000; 3. A City of Guelph monthly stormwater charge of $4.00 per Equivalent Residential Unit effective January 1, 2017; and 4. That the Stormwater Fees or Charges By-Law be passed. 3. That for Court Services the following be approved: 1. Proposed expansion package in the net amount of $64,300 for Court Services; 2. A 2017 Court Services Operating Budget in the amount of $3,901,750; and 3. A 2017 Court Services Capital Budget and Capital Forecasts in the amount of $504, That for Ontario Building Code Administration the following be approved: 1. A 2017 Ontario Building Code Administration Operating Budget in the amount of $3,390,300; and 2. The 2017 Ontario Building Code Administration Capital Budget and Capital Forecasts in the amount of $69, That for reserve and reserve funds the following be approved: The proposed transfers to/from reserves and reserve funds incorporated in the 2017 non-tax supported budget attached as Schedule B be approved. Adjournment City of Guelph Council Agenda Page 2 of 2

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4 Budget timeline Budget Non-tax supported Ontario Building Code Administration Court Services Water Services Wastewater Services Stormwater Services Local Boards and Shared Services Staff Presentation Public Delegations Council Approval Tonight Tonight November 3 November 16 November 30 December 7 Tax supported Capital November 3 November 3 December 7 Operating November 9 November 30 December 7 - Expansions November 16 November 30 December 7 - Reductions November 16 November 30 December 7 3 Agenda Program overviews Highlights and assumptions Budget overview operating and capital Integrated capital planning Challenge and opportunity Capital budget key principals Ontario Building Code Administration Court Services Water Services Wastewater Services Stormwater Services Capital programs of work 4 2

5 Program overviews Ontario Building Code is responsible for the administration and enforcement of the OBC Court Services provides mandatory court services Water Services ensures a safe, secure and sustainable water supply to the community Wastewater Services delivers reliable sanitary services and high quality effluent Stormwater Services provides flood prevention and protects the City s water resources 5 Highlights and assumptions 2017 builds on previous years work No transfer from property tax (fee and rate based budgets) Budgets support Council-approved infrastructure planning studies, financial plans, and corporate guidelines Maintain existing infrastructure Consider affordability Address the infrastructure gap (achieve sustainability) 6 3

6 Budget overview - operating Ontario Building Code Administration Gross expenditure Court Services Gross expenditure Water Services Gross expenditure Wastewater Services Gross expenditure Stormwater Services Gross expenditure $3,070,000 $3,390,300 $3,721,800 $28,644,042 $29,799,028 $2,116,600 $3,901,750 $30,450,665 $30,946,448 $4,219,000 7 Budget overview capital Ontario Building Code Administration $35,000 $26,200 $42,800 Court Services $27,800 $50,000 $454,300 Water Services $15,137,300 $18,096,000 $162,055,100 Wastewater Services $12,790,500 $8,298,900 $129,530,600 Stormwater Services $3,860,000 $4,151,100 $36,543,

7 Recommendation That Report No. CS titled 2017 Non-Tax Supported Operating and Capital Budgets be referred to the November 3, 2016 Council Budget meeting. 9 Ontario Building Code Administration Tab

8 Key changes in 2017 No increase in permit revenue for 2017 Increase in staff support costs for OBC work Corresponding reduction in tax-supported budget Interdepartmental support reduction Reserve fund transfer to balance budget Tab 1, page recommended budget: operating Item 2015 actuals 2016 approved budget Total 2017 recommended budget Yr/Yr change Yr/Yr change (%) Permit Revenue ($3,607,816) ($3,070,000) ($3,000,000) ($70,000) -2.3 Total Revenue ($3,607,816) ($3,070,000) ($3,390,300) ($320,300) 10.4 Transfers to Reserves $783,431 $270 $0 ($270) 100 Total Expenditures $3,607,816 $3,070,000 $3,390,300 $320, Net budget $0 $0 $ Full-time equivalents Tab 1, page

9 recommended budget: operating Item Total 2017 recommended budget 2018 projected 2019 projected 2020 projected Permit Revenue ($3,000,000) ($3,120,000) ($3,244,800) ($3,374,600) Total Revenue ($3,390,300) ($3,469,630) ($3,551,300) ($3,619,700) Transfers to Reserves $0 $0 $0 $0 Total Expenditures $3,390,300 $3,469,630 $3,551,300 $3,619,700 Net budget $0 $0 $0 $0 Full-time equivalents The forecasted draw on the reserve fund is not sustainable. A strategy will be developed to mitigate this systemic negative variance during the preparation of the 2016 reserve fund report. Tab 1, page Permit fees, operating costs & reserve activities ($000's) 4,000 3,500 3,000 2,500 2,000 1,500 1, Projected 2017 Forecast 2018 Forecast 2019 Forecast 2020 Forecast Permit Fee Revenues Operating Costs Reserve Fund Tab 1, page

10 capital budget Total project cost Capital reserves Strategic Plan - IT $69,000 ($69,000) Total capital budget $69,000 ($69,000) The figure represents the 10-year capital costs to be funded from OBC. Tab 1, page initiatives OUR SERVICE Implement the electronic permit drawing project OUR RESOURCES Recommend building bylaw amendments Review full year results of radon testing program Implement building code amendments Tab 1, page

11 Court Services Tab 2 17 Funding models POA Gross revenue - expenses =Net share to County =Net share to City (to non-tax budget reserves) Parking Ticket Administration Gross revenue - expenses =Total net to City (to tax-supported budget) 18 9

12 2016 trends informing 2017 budget Increase in POA charge volumes Increase in parking charge volumes Increase in payments through collection agencies and online payments recommended budget: operating Item 2015 actuals 2016 approved budget Total 2017 recommended budget Yr/Yr change ($) Yr/Yr change (%) Revenues ($4,009,408) ($3,721,800) ($3,901,750) (179,950) 4.8 Expenditures $3,420,430 $3,709,795 $3,833, , Net budget before reserve financing ($588,978) ($12,005) ($68,035) (56,030) Reserve financing $588,978 $12,005 $68,035 56, Net budget after reserve financing $0 $0 $ Full-time equivalents Tab 2, page

13 budgets: operating Item 2017 requested budget 2018 projected budget 2019 projected budget 2020 projected budget Revenues ($3,901,750) ($3,955,942) ($4,011,218) ($4,067,599) Expenditures $3,833,715 $3,897,533 $3,945,602 $3,968,320 Net budget before reserve financing ($68,035) ($58,409) ($65,616) ($99,279) Reserve financing $68,035 $58,409 $65,617 $99,279 Net budget after reserve financing $0 $0 $0 $0 Full-time equivalents Tab 2, page Operating expansion Title/Position: POA Clerk Type: Growth Budget impact: $63,800 Overview Address additional payment processing and customer service requirements related to: Collections Online payments Increasing charge volumes Tab 2, page

14 Funding models POA Gross revenue expenses ($2,809,600) $2,040,245 Revenue above 2016 budget =Net share to County ($301,320) ($15,220) Parking Ticket Administration =Net share to City ($468,035) (to non-tax budget reserves) ($56,030) Gross revenue expenses ($1,070,300) $214,650 =Total net to City ($855,650) (to tax-supported budget) ($41,570) 23 POA net revenue distribution Of the net share to the City ($468,035): $400,000 to capital debt service costs $ 68,035 to POA Contingency Reserve 24 12

15 capital budget Total project cost County contributions Capital reserves Court facilities $235,900 $117,950 $117,950 Court administration $268,400 $134,200 $134,200 Total capital budget $504,300 $252,150 $252,150 Tab 2, page Reserves and reserve funds $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $ Contingency Capital Tab 2, page

16 2017 initiatives OUR SERVICES Digital case management (e.g. electronic case disclosure) Explore remote language interpretation for trial courts OUR RESOURCES Expand data upload capabilities for e-ticket solutions Investigate options to upgrade Parking Ticket operating system Tab 2, page Water Services Tab X 28 14

17 Statutory standard of care The Safe Drinking Water Act, 2002 includes a statutory standard of care for individuals who have decision-making authority over municipal drinking water systems or who oversee the operating authority of the system. This can extend to municipal councilors. There are legal consequences for not acting as required by the standard of care, including possible fines or imprisonment. It is important that members of municipal council and municipal officials with decisionmaking authority over the drinking water system and oversight responsibilities over the accredited operating authority understand that they are personally liable, even if the drinking water system is operated by a corporate entity other than the municipality. Excerpted from Taking Care of Your Drinking Water: A Guide for Members of Municipal Councils Province of Ontario (2014) Tab 4, page Pressures on water and wastewater rates Forecasted 0.8 per cent decrease in 2017 billable consumption: Efficient building for residential growth Conservation program gains = lower customer use 2016 was a leap year Capital financing, compensation and expansions Increases to departmental cross charges 30 15

18 Pressures on water and wastewater rates Overall electricity cost increase of 16 per cent Property tax adjustments and new servicing charges A mandatory financial plan that requires sustainable funding Need to close the sustainable infrastructure funding gap Capital reserves not sufficient to fund accumulated depreciation 31 Rate setting objectives Consistent with sustainability targets of Long-Range Financial Plan Ensure continued compliance with provincial regulations Ensure adequate lifecycle funding for system infrastructure renewal Predictable and affordable - eliminate rate spikes Maintain cost competitiveness Encourage efficient use by allowing customers to pay based on usage 32 16

19 Demand forecasting methodology 2016 YTD revenue analysis and year-end forecasting Revenue stream growth evaluation and forecast Accuracy assessment and revenue stream adjustment 2017 billable revenue forecast development 33 Budget development Getting the numbers right Develop detailed water and wastewater demand forecasts Update and modify budget expense lines to meet spending targets Develop, review, and prioritize expansion packages Update capital budget and forecast 34 17

20 Budget development Modeling required rates Match rate model to expense total and required revenue (both volumetric and basic rates) Model required reserve contributions Prepare multi-year budget forecasts Benchmark against Council-approved Long-range Financial Plan 35 Benefits of efficient water use Customers control and reduce bills Decreases and defers community capital investments Reduces water and wastewater pumping, treatment, chemical, and maintenance costs (lowers rate pressures) Cheapest source of new capacity for service reliability and future growth Leaves groundwater in the aquifer for future use and environmental benefit Mandated by the province as part of our Permits To Take Water 36 18

21 Residential Consumption Per Capita: city of Guelph average single family household Water Use Per Household (cubic metres/year) Note: peak in 2015 due to frozen water pipes 37 Rate change and forecast Change Water volume charge $/cubic metre $1.59 $1.67 $0.08 Water basic charge $/day $0.26 $0.26 $0.00 Wastewater volume charge $/cubic metre $1.73 $1.80 $0.07 Wastewater basic charge $/day $0.32 $0.32 $0.00 Average residential annual bill (180 cubic metres*) $810 $836 $26 or 3.3% Predicted actual average residential annual bill** $810 $824 $14 or 1.7% *Average annual volume of water consumed by a three-person household in Guelph ** Average residential annual bill with two per cent applied decrease observed in residential sector (2011 to 2015 average) equaling 176 cubic meters/year housed consumption in average residential annual bill is prorated for 365 days for comparison to the 2016 bill Tab 3, page

22 Water/Wastewater rate and budget forecasts 2017 forecasted 2017 recommended Long-range Financial Plan Water Budget per cent increase 4.6% 6.3% 5.0% Volume charge per cubic metre $1.69 $1.67 Wastewater Budget per cent increase 4.6% 5.1% 5.0% Volume charge per cubic metre $1.84 $1.80 Tab 3, page Comparison of residential water/wastewater total volumetric and service charges (2016 rates) Tab 3, page

23 Comparison of Average Household Water/ Wastewater Bills by Municipality (2016 rates) $1, $1, $ $ $ $ $0.00 Green bars represent municipalities using groundwater Purple bar represents the City of Guelph which also uses groundwater Blue bars represent municipalities using surface water or a mix of surface and groundwater Tab 3, page major operating budget changes Revenue Billable consumption: forecast 0.8 per cent decrease Operating budget Compensation increase of $241,100 or 3.7 per cent Purchased goods increase of $401,920 or 14.0 per cent including Increase in utility and taxes costs ($350,000) Increase in operating cost ($51,900) Tab 4, page

24 2017 major operating budget changes Operating budget (continued) Purchased services increase of $127,650 or 4.3 per cent including Increase in rental equipment and operators ($50,500 or 23.4%) Other transfers increase of $14,673 (GRCA Levy) Tab 4, page major operating budget changes Operating budget (continued) Internal charges increase of $241,480 or 8.1 per cent (Fleet, IT, budget realignment) Reduction in Contingency Fund of $440,000 Net expenditure increase of 3.6 per cent Not including expansions and capital financing Tab 4, page

25 2017 major operating budget changes Operating Budget Capital financing increase by $770,000 (6.3%) growth and nongrowth Overall operating expenditures increase of $1,806,623 (6.3%) Tab 4, page recommended budget: operating Item 2015 actuals 2016 approved budget Total 2017 recommended budget Yr/Yr change ($) Yr/Yr change (%) Revenues ($28,122,035) ($28,644,042) ($30,450,655) ($1,806,623) 6.3 Expenditures $28,122,035 $28,644,042 $30,450,655 $1,806, Net budget $0 $0 $0 $0 0.0 Full-time equivalents Tab 4, page

26 Three-year operating budget forecast and drivers Assumptions: Water Services Forecast Reflective of the approved Long-range Financial Plan (LRFP) 2018 & 2019 Three per cent increase to compensation Two per cent net increase on purchased goods and purchased services this includes a five per cent increase to utilities No increase to training and consulting costs 47 Three-year operating budget forecast and drivers 2020 Five per cent increase to administration Three per cent increase to supply, distribution and metering Capital contributions In accordance with LRFP to meet reserve fund targets Projected FTE requests for Water Services based on regulatory driven program expansions for additional supply and distribution operators and related program funding 48 24

27 budgets: operating Item 2017 recommended budget 2018 projected 2019 projected 2020 projected Revenues ($30,450,655) ($31,997,700) ($33,511,400) ($35,129,698) Expenditures $30,450,655 $31,997,700 $33,511,400 $35,129,698 Net budget $0 $0 $0 $0 Full-time equivalents Tab 4, page Operating expansion Title/Position: Water Permit Monitoring Program Type: Legislative Budget impact: $395,600 Overview Permits to Take Water allow the City to use groundwater for its municipal water supply Recent changes to permit monitoring requirements require additional monitoring of the City s well fields to ensure sustainability and water quality No FTEs associated with expansion Tab 4, page

28 Operating expansion Title/Position: Source Water Protection Program Coordinator Type: Growth/Legislative Budget impact: $0 Overview Coordinate building permit applications, development plan applications and Committee of Adjustment submissions Under Section 59 of the Clean Water Act, Section 59 notices must be issued for all development applications and building permits that are subject to the Source Protection Plan Tab 4, page Operating expansion Title/Position: Corporate Analyst: non-tax Type: Growth/Financial Stability Budget impact: $109,500* Overview To implement added analytical rigor to improves the city s financial integrity and sustainability Increase Finance capacity to sign-off on all Council reports as per audit recommendation Fully dedicated to non-tax-supported City services (Water, Wastewater, Courts, OBC and Stormwater) *Note: Expansion costs to be split between non-tax-supported departments Tab 4, page

29 capital budget Total project cost Development Charges Grants and Subsidies Capital reserves Growth $81,984,500 $60,794,200 $0.0 $21,190,300 Infrastructure replacement Total capital budget $98,166,600 $7,318,000 $1,007,400 $89,841,200 $180,151,100 $68,112,200 $1,007,400 $111,031,500 Tab 4, page Reserves and reserve funds projected balances Tab 4, page

30 2017 Water and Wastewater financial indicators Target 2017 predictions: Water LRFP Actuals Water 2017 predictions: Wastewater LRFP Actuals Wastewater Debt to total reserve ratio < 1:1 0.0:1 0.0:1 0.0:1 0.0:1 Operating reserves as a % of own source revenue 8-10% of Revenues 8.0% 9.0% 8.0% 11.9% Operating surplus ratio Positive Positive Positive Positive Positive Asset consumption ratio 35% n/a 38.4% n/a 46.4% Capital Reserves as a % of historical asset value Capital Reserves as a % of asset replacement value 2-3% 4.5% 8.9% 4.0% 8.6% 2-3% 2.2% 2.2% initiatives OUR SERVICE Initiate detailed cost of service study to evaluate true cost of water and wastewater services OUR RESOURCES Complete treatment system upgrades at Burkes Well Construct Paisley-Clythe feeder main (third phase) Recoat and resurface Speedvale water tower Complete detailed engineering design for F.M. Woods Pumping Station Implement updated, Council-approved Water Efficiency Strategy Continue implementation of the Source Water Protection Plan Tab 4, page

31 Wastewater Services Tab 5 57 Wastewater treatment: process performance 58 29

32 2017 major operating budget changes Revenue Billable consumption: 0.8 per cent Operating Budget $ increase/ decrease % increase/ decrease Compensation $85, % Purchased Goods $342,200 15% offset by a decrease of $123,600 (-6.4%) in small tools and chemicals Purchased services ($63,545) -1.7% Repairs and maintenance Other transfers $18, % GCRA Levy Metering/billing/locates/ other staff chargebacks $328, % Internal charges Tab 5, page major operating budget changes No contingency reserve transfer No stabilization reserve transfer Net expenditure increase of 3.9 per cent not including expansions and capital financing Expansions: increase of $54,800 due to shared Finance staffing position Capital financing: increase of $500,000 (3.9%) growth and renewal Overall operating expenditures increase of $1,147,420 (3.9%) Tab 5, page

33 2017 recommended budget: operating Item 2015 actuals 2016 approved budget Total 2017 recommended budget Yr/Yr change Yr/Yr change (%) Revenues ($30,138,867) ($29,799,028) ($30,946,448) ($1,147,420) 3.9 Expenditures $30,138,867 $29,799,028 $30,946,448 $1,147, Net budget $0 $0 $0 $0 0.0 Full-time equivalents Tab 5, page Three-year operating budget forecast and drivers Assumptions Wastewater Services forecast Reflective of the approved Long-range Financial Plan (LRFP) Compensation 3.0% 3.0% 3.45% Purchased goods 3.4% 3.5% 3.2% Purchased services 1.35% 1.37% 3.6% Capital contributions in accordance with LRFP to meet reserve fund targets 62 31

34 capital budget Total project cost Development Charges Grants Developer Capital reserves Growth $105,737,000 $884,200 $0 $819,100 $35,033,800 Infrastructure replacement Total capital budget $32,092,500 $308,600 $768,600 $0 $31,015,400 $137,829,500 $192,800 $768,600 $819,100 $66,049,200 Tab 5, page initiatives OUR SERVICE Update Wastewater Treatment and Biosolids Management Master Plan Continue digester cleaning program OUR RESOURCES Continue generator purchase and installation program Continue wastewater treatment plan re-rating process Start management and capital programs review Continue innovative anammox treatment process, a first in Canada Continue biosolids storage project Tab 5, page

35 Stormwater Services Tab 6 65 Program overview 66 33

36 Program overview Purpose: to protect people and property from flooding to protect the City s water resources Infrastructure is in need of upgrades and repairs 67 Timeline : Sustainable Funding Study March 2016: Council approves transition of program funding from property tax to a fee-based service September 2016: Council approves the policies, draft Fees or Charges Bylaw, establishment of reserves, and billing agent retainer Coming up November 3, 2016: Stormwater rate approval ($4/month) January 2017: billing begins (fee on Guelph Hydro bill) 2017: assessment of potential credit program 68 34

37 Rate highlights Funding via property taxes by sector Funding via ERU fee model by sector 18% 30% 22% 44% 52% 34% ICI Residential: detached Residential: attached ICI Residential: detached Residential: attached The ERU fee model provides a balance between fairness, equity and ease of administration 69 Rate highlights Impervious area by sector Funding via ERU fee model by sector 11% 22% 47% 44% 42% 34% ICI Residential: detached Residential: attached ICI Residential: detached Residential: attached The ERU fee model provides a balance between fairness, equity and ease of administration 70 35

38 budget adjustment The 2016 tax-supported budget has been adjusted removing $1.9 million from the tax base The City will be obligated to pay stormwater fees for municipally owned properties in the approximate amount of $200,000 The 2016 non-tax-supported budget adjusted adding $2.1 million to form the base budget for Stormwater Services 71 Sustainable Funding Strategy Interim to Sustainable - 5 years (Recommended option) Equivalent Residential Unit (ERU) Monthly Rate $7.00 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $ Annual Budget/Revenue

39 Stormwater fee comparison $200 $180 $160 $140 Average Annual Cost $120 $100 $80 $60 $40 Guelph sustainable at $76.20 $20 $0 Guelph (recommended) Richmond Hill Aurora Waterloo St. Thomas Mississauga Kitchener London 73 Stormwater rate change and forecast Summary of rate and impact on average residential household Average monthly residential household stormwater contribution Average residential annual bill* $2.36 $4.00 $4.60 $5.20 $5.80 $28.32 $48.00 $55.20 $62.40 $69.60 *Average impervious area of a residential property is 188 m rates will come into effect on January 1, Tab 6, page

40 2017 recommended budget: operating Item 2016 restated budget Total 2017 recommended budget Yr/Yr change Yr/Yr change (%) Revenues ($2,116,600) ($4,219,000) ($2,102,400) 99.3 Expenditures $2,116,600 $4,219,000 $2,102, Net budget $0 $0 $0 0.0 Tab 6, page budgets: operating Item 2017 recommended budget 2018 projected 2019 projected 2020 projected Revenues ($4,219,000) ($4,819,000) ($5,419,000) ($6,024,900) Expenditures $4,219,000 $4,819,000 $5,419,000 $6,024,900 Net budget $0 $0 $0 $0 Tab 6, page

41 capital budget Total project cost Development Charges Grants and Subsidies Capital reserves Growth $860,000 $708,000 $0 $152,000 Infrastructure replacement Total capital budget $39,835,000 $18,700 $1,496,500 $38,319,800 $40,695,000 $726,700 $1,496,500 $38,471,800 Tab 6, page Capital Planning and Programs of Work 78 39

42 Integrated capital planning 79 Challenge and opportunity Challenge Review of non-tax-supported budget in isolation of tax-supported budget Cutting projects in one budgets results in approved funding from the second budget being unusable Leads to unspent capital Opportunity Corporate asset management system highlights connection between projects in a transparent manner 80 40

43 Capital budget key principals Evidence-based based on factual or estimated data, documented procedures and a business case Collaboratively developed based on consultation with multiple departments and front-line staff Prioritized ensures the most critical projects are proposed at the right time reserves and reserve fund projected balances $120 Water Services Capital Reserve $100 Millions $80 $60 $40 $20 $ Current Sustainable + Backlog 82 41

44 reserves and reserve fund projected balances Wastewater Services Capital Reserve Millions $160 $140 $120 $100 $80 $60 $40 $20 $ Current Sustainable + Backlog 83 Programs of work Program of work Downtown Infrastructure Renewal Full Corridor Reconstruction -Growth Full Corridor Reconstruction - Renewal Stormwater Collection and Storage & Filtration Benefit Risk 2017 non-tax investment maintain and support the redevelopment of properties in the area ensure that levels of service are being maintained ensure that levels of service are being maintained protect streams and rivers mitigate flooding comply with MOECC regulations defers escalating costs stall ongoing development activities and future interests risks of flooding or backups likelihood of underground infrastructure failure likelihood of underground infrastructure failure harm to property and human life non compliance with the MOECC which can result in charges and/or fines Tab 7 page $4,126, $2,290, $4,612, $7,265,

45 Programs of work Program of work Wastewater Collection Wastewater Plant & Equipment Water Distribution Network Water Plant & Equipment Benefit Risk 2017 non-tax investment satisfy capacity requirement of the system long-term reliability of assets and capacity proactively minimizing risks and maintain levels of service provide safe and reliable source of water likelihood of underground infrastructure failure unexpected downtime Replacement parts are not readily available interruptions in service delivery reduction in water quality additional maintenance costs and time regulatory non-compliance interruptions in service delivery reduction in water quality regulatory non-compliance Tab 7 page $1,150, $1,055, $0 110 $12,307, Downtown Infrastructure Renewal Total 2017 investment: $6,598,000 Non-tax 2017 investment: $4,126,000 Overview linear infrastructure downtown is some of the oldest in Guelph continued need to address renewal to maintain and support the redevelopment of properties in the area Risk delaying the investment simply defers escalating costs and has the potential to stall ongoing development activities and future interests Tab 7, page

46 Downtown Infrastructure Renewal Financial investment Total Roads & Bridges $2,472,000 $3,701,000 $588,000 $24,619,000 $31,380,000 Stormwater $319,000 $2,058,000 $25,000 $948,000 $3,350,000 Wastewater $2,121,000 $1,047,000 $45,000 $1,235,000 $4,448,000 Water $1,686,000 $573,000 $50,000 $1,483,000 $3,792,000 Total $6,598,000 $7,379,000 $708,000 $28,285,000 $42,970, Downtown Infrastructure Renewal 2017 Budget approval and funding Budget amount Funding source Tax-supported $2,472,000 Tax $1,165,000 Grants $1,307,000 Non-tax-supported $4,126,000 Rate $4,067,000 DC $59,000 Total $6,598,000 $6,598,000 Operating impacts There are no known operating impacts at this time

47 Full Corridor Reconstruction, Growth Total 2017 investment: $3,690,000 Non-tax 2017 investment: $2,290,000 Overview To optimize the project list to ensure that levels of service are being maintained Risk Insufficient infrastructure capacity to support growth Increased risks of flooding or backups (in the case of wastewater and stormwater) Increased likelihood of underground infrastructure failure contamination of the drinking water supply water service interruptions sink holes, vehicle damage (due to pot holes), property damage, sewer backups, or basement flooding Tab 7, page Full Corridor Reconstruction, Growth Financial investment Total Roads $1,400,000 $4,998,000 $3,988,000 $65,376,000 $75,762,000 Stormwater $814,000 $740,000 $11,429,000 $12,983,000 Water $756,000 $1,491,000 $1,422,000 $17,553,000 $20,222,000 Wastewater $1,534,000 $1,159,000 $1,639,000 $16,882,000 $21,214,000 Total $3,690,000 $8,462,000 $7,789,000 $111,241,000 $131,182,

48 Full Corridor Reconstruction, Growth 2017 Budget approval and funding Budget amount Funding source Tax-supported $1,400,000 Grant Tax DC $826,000 $317,000 $257,000 Non-tax-supported $2,290,000 Rate $1,696,000 DC $594,000 Total $3,690,000 $3,690,000 Operating impacts There are no known operating impacts at this time. 91 Full Corridor Reconstruction, Renewal Total 2017 investment: $7,009,800 Non-tax 2017 investment: $4,612,000 Overview To optimize the project list to ensure that levels of service are being maintained Risk Insufficient infrastructure capacity to support growth Increased likelihood of underground infrastructure failure contamination of the drinking water supply water service interruptions sink holes, vehicle damage (due to pot holes), property damage, sewer backups, or basement flooding Tab 7, page

49 Full Corridor Reconstruction, Renewal Financial investment ( 000s) Total Roads $2,398,000 $334,000 $2,936,000 $14,620,000 $20,288,000 Stormwater $811,000 $322,000 $492,000 $3,686,000 $5,311,000 Water $2,207,000 $961,000 $6,064,000 $6,059,000 $15,291,000 Wastewater $1,594,000 $648,000 $542,000 $3,076,000 $5,860,000 Total $7,010,000 $2,265,000 $10,034,000 $27,441,000 $46,750, Full Corridor Reconstruction, Renewal 2017 Budget approval and funding ( 000s) Budget amount Funding source Tax-supported $2,398,000 Tax Grants CAR Reserve $1,665,000 $550,000 $183,000 Non-tax-supported $4,612,000 Rate Grants CAR Reserve $2,341,000 $2,147,000 $124,000 Total $7,010,000 $7,010,000 Operating impacts There are no known operating impacts at this time

50 Stormwater Collection and Storage & Filtration Total 2017 investment: $7,265,000 Non-tax 2017 investment: $7,265,000 Overview To protect the health of our streams and rivers, mitigating flooding in extreme weather To comply with regulations set by the Ministry of the Environment and Climate Change (MOECC) Risk assets deteriorating to a state of disrepair ceasing to meet the performance expected potentially causing harm to property and human life non compliance with the MOECC which can result in charges and/or fines Tab 7, page Stormwater Collection and Storage & Filtration Financial investment Total Collection $375,000 $580,000 $955,000 $3,755,000 $5,665,000 Storage & $6,890,000 $500,000 $1,080,000 $3,810,000 $12,280,000 Filtration Total $7,265,000 $1,080,000 $2,035,000 $7,565,000 $17,945,

51 Stormwater Collection and Storage & Filtration 2017 Budget approval and funding ( 000s) Budget amount Funding source Tax-supported $0 Tax $0 Own revenue $0 Rate $633,000 Grants $4,875,000 Non-tax-supported $7,265,000 CAR reserve $1,625,000 DC $132,000 Total $7,265,000 $7,265,000 Operating impacts There are no known operating impacts at this time. 97 Wastewater Collection Total 2017 investment: $1,150,000 Non-tax 2017 investment: $1,150,000 Overview To satisfy capacity requirement of the system by: Optimizing existing systems increasing capacities of existing systems reducing water loss increasing water conservation protecting the natural environment enhancing asset management Tab 7, page

52 Wastewater Collection Financial investment Total Collection $400,000 $800,000 $1,750,000 $8,250,000 $11,200,000 (Growth) Collection $750,000 $550,000 $570,000 $5,246,000 $7,116,000 (Renewal) Total $1,150,000 $1,350,000 $2,320,000 $13,496,000 $18,316, Wastewater Collection 2017 Budget approval and funding Budget amount Funding source Tax-supported $0 Tax $0 Own revenue $0 Non-tax-supported $1,150,000 Rate $950,000 DC $200,000 Total $1,150,000 $1,150,000 Operating impacts There are no known operating impacts at this time

53 Wastewater Plant & Equipment Total 2017 investment: $12,307,300 Non-tax 2017 investment: $12,307,300 Overview To provide long-term reliability of assets and capacity Risk Unexpected downtime Replacement parts are not readily available Tab 7, page Wastewater Plant & Equipment Financial investment Total Treatment & Storage, $851,000 $7,350,000 $3,997,000 $60,506,000 $72,704,000 growth Treatment & Storage, $204,000 $804,000 $804,000 $6,870,000 $8,886,000 renewal Total $1,055,000 $8,154,000 $4,801,000 $67,580,000 $81,590,

54 Wastewater Plant & Equipment 2017 Budget approval and funding Budget amount Funding source Tax-supported $0 Tax $0 Own revenue $0 Non-tax-supported $1,055,000 Rate $438,000 DC $617,000 Total $1,055,000 $1,055,000 Operating impacts There are no known operating impacts at this time. 103 Water Distribution Network Total 2017 investment: $0 Non-tax 2017 investment: $0 Overview Proactively minimizing risks and maintaining levels of service through renewal, capacity enhancements, and improving security of supply to the water distribution network Risk Interruptions in service delivery, reduction in water quality, additional maintenance costs and time, and potential regulatory non-compliance with the Safe Drinking Water Act Tab 7, page

55 Water Distribution Network Financial investment Total Distribution network, growth $0 $100,000 $184,000 $12,553,000 $12,837,000 Distribution network, renewal $0 $0 $1,732,000 $6,177,000 $7,909,000 Total $0 $100,000 $1,916,000 $18,730,000 $20,746, Water Distribution Network 2017 Budget approval and funding ( 000s) Budget amount Funding source Tax-supported $0 Tax Own revenue $0 Non-tax-supported $0 Rate DC $0 Total $0 $0 Operating impacts There are no known operating impacts at this time

56 Water Plant & Equipment Total 2017 investment: $12,307,300 Non-tax 2017 investment: $12,307,300 Overview To proactively add additional supply To renew existing systems Risk interruptions in service delivery; reduction in water quality additional maintenance costs and time; insufficient servicing capacity potential regulatory non-compliance Tab 7, page Water Plant & Equipment Financial investment Total Supply, Treatment $1,930,000 $15,926,000 $6,126,000 $43,884,000 $70,385,000 & Protection (Growth) Supply, Treatment $7,711,000 $12,665,000 $6,305,000 $24,958,000 $49,819,000 & Protection (Renewal) Conservation & $2,666,000 $586,000 $571,000 $4,134,000 $7,257,000 Efficiency Total $12,307,000 $29,177,000 $13,002,000 $72,976,000 $127,461,

57 Water Plant & Equipment 2017 Budget approval and funding Budget amount Funding source Tax-supported $0 Tax $0 Own revenue $0 Non-tax-supported $12,307,000 Rate $7,831,000 DC $4,476,000 Total $12,307,000 $12,307,000 Operating Impacts Department Item Year Cost Cost type Water Services Annual Operating (Ongoing) 2018 $94,000 New Maintenance Staff Salary/Benefits Burkes Water Services Annual Operating (Ongoing) 2018 $67,000 Operational Costs (Energy) for New Treatment System - Burkes 109 Recommendations That Report No. CS titled 2017 Non-Tax Supported Operating and Capital Budgets be referred to the November 3, 2016 Council Budget meeting

58 2017 Water, Wastewater and Stormwater Rates and Fees Change Water volume charge $/cubic metre $1.59 $1.67 $0.08 Water basic charge $/day $0.26 $0.26 $0.00 Wastewater volume charge $/cubic metre $1.73 $1.80 $0.07 Wastewater basic charge $/day $0.32 $0.32 $0.00 Stormwater service fee - $/month $2.36 $4.00 $

59 Grand River Conservation Authority 2017 Draft Budget City of Guelph October 26, About the Grand River Watershed Largest watershed in Southern Ontario; 300 km long from Dundalk to Lake Erie Major tributaries: Conestogo, Speed, Eramosa, Nith Population: about 1 million Rich agricultural region More than 50 municipal and Six Nations drinking water systems serving 80% of residents 30 municipal and First Nations wastewater treatment plants serving 85% of residents 2 1

60 GRCA Strategic Plan Budget The Grand River lies at the heart of one of the richest, fastest growing regions in Ontario The vitality of the watershed has been linked to the river and the natural environment The Grand River watershed faces emerging challenges 4 2

61 2017 Budget Priorities: Climate Change causing more extreme events, e.g.: severe weather, droughts, floods Budget Priorities: Population Growth expected to reach about 1.5 million by 2051, increasing demands 6 3

62 2017 Budget Priorities: Extensive Agriculture about 70 % of the land is farmed Budget 8 4

63 2017 Budget Water Management Plan ( ) Now in its 3 rd year of implementation, the Plan builds resiliency to address challenges in the watershed related to climate change, population growth & agriculture Wastewater Optimization Watershed Wide Wastewater Optimization Program (WWOP) began as a pilot project in 2010, and builds upon the successful optimization work in municipalities like Guelph Budget Source Water Protection Grand River Source Protection Plan took effect July 1, 2016 Ongoing technical work and policy development Province funded 100% of Plan s development Represents more than 8 years of collaborative work 10 5

64 2017 Budget 7 reservoirs actively managed to reduce flood damages and maintain flows Flood peaks reduced 50% or more Water released during summer & fall maintains minimum flows Ensure drinking water and waste treatment plants can operate properly Budget Enhanced Technology, Improved Monitoring and Preparedness 12 6

65 2017 Budget Rural Water Quality Program (RWQP) Watershed Success Over 5,500 projects $16 million in grants More than $45 million invested Budget Planning and Development GRCA assists member municipalities in the development of official plans and zoning by laws GRCA provides technical advice on Planning Act applications Advice includes input from biologists, water resource engineers and resource planners on natural hazards, wetlands, fisheries, storm water and subwatershed planning 14 7

66 2017 Budget GRCA Landholdings more than 48,000 acres of recreational and natural land includes 11 parks, Luther Marsh, 6 nature centres Current initiatives in Guelph include restoration of the Niska property, the wind down of the residential tenancy program and hazard tree management Budget GRCA Parks/Conservation Areas Weather dependent Revenue forecasts are prone to significant fluctuations 2015 and 2016: record breaking years for revenue Natural Areas Increasing management and cost pressures due to population growth and changing demographics 16 8

67 2017 Budget Outdoor Education More than 40,000 students participate in GRCA outdoor education programs annually More than 1,400 day campers in the summer of 2016 Programming provided for more than 10,000 children and families through various events, birthday parties and youth organizations Budget Timetable September 23, 2016 January 25, 2017 January 27, 2017 February 24, 2017 Draft #1 to General Meeting Municipalities advised of Meeting Date for Budget Draft #2 to General Meeting Board Approval, 2017 Budget & Levy (AGM) (Presentations to municipal councils between October 2016 and February 2017 as required) 18 9

68 2017 Budget Overview 2017 expenditures: $29.4 million ($31 million in 2016) Municipal dollars highly leveraged ($1 in municipal levy matched by $2 from other sources) Per capita municipal levy: $ Budget $12.00 GRCA Per Capita Levy 2007 to 2017 $10.00 $8.41 $8.86 $9.27 $9.75 $9.90 $10.04 $10.19 $10.29 $10.39 $10.49 $10.60 $8.00 $6.00 $4.00 $2.00 $ Year 20 10

69 2017 Budget: Revenue by Source Total 2017 Budget Revenue = $29.4 Million ($ 31.0 Million in 2016) Budget: Revenue (cont d) Revenue Categories Have remained consistent in relative size year over year General Municipal Levy Increasing by 2.5% to $11,075,000 in 2017 Operating Levy increasing 2.17% or $216,000 Capital Levy increasing 5% or $50,000 Special Projects Expenses are offset 100% by special funding sources Do not use general municipal levy to fund these projects 22 11

70 2017 Budget: Expenditures by Category 2017 Budget Expenditures = $29.4 Million ($ 31.0 million in 2016) Budget: Expenditures (cont d) Operating Budget ($24.4 million) Watershed Management (dams, flood forecasting, planning, lands management, education) Conservation Areas Corporate Services and Communication 24 12

71 2017 Budget: Expenditures (cont d) Capital Budget ($2.6 million) Water Control Structures Conservation Areas Budget: Expenditures (cont d) Special Projects ($2.4 million) Rural Water Quality Program Future land dispositions Trees for Guelph Children s Water Festivals Species at Risk Water Management Plan Mill Creek Rangers Source Protection Program Emerald Ash Borer 26 13

72 2017 Budget Grand River Conservation Authority Summary of Municipal Levy Budget % CVA in 2016 CVA CVA-Based 2017 Budget 2017 Budget 2017 Budget Actual Watershed (Modified) CVA in Watershed Apportionment Operating Levy Capital Levy Total Levy 2016 Levy % Change Brant County 84.0% 5,446,291,473 4,574,884, % 320,562 33, , , % Brantford C 100.0% 11,594,112,203 11,594,112, % 812,400 85, , , % Amaranth Twp 82.0% 614,567, ,945, % 35,311 3,698 39,009 37, % East Garafraxa Twp 80.0% 475,595, ,476, % 26,660 2,792 29,452 28, % Town of Grand Valley 100.0% 352,562, ,562, % 24,704 2,587 27,291 25, % Melancthon Twp 56.0% 454,303, ,409, % 17,827 1,867 19,694 18, % Southgate Twp 6.0% 779,464,748 46,767, % 3, ,620 3, % Haldimand County 41.0% 5,769,685,956 2,365,571, % 165,756 17, , , % Norfolk County 5.0% 7,965,883, ,294, % 27,908 2,923 30,831 30, % Halton Region 10.3% 33,945,230,659 3,502,828, % 245,443 25, , , % Hamilton City 4.7% 72,428,903,704 3,404,158, % 238,529 24, , , % Oxford County 38.1% 3,366,734,453 1,282,809, % 89,887 9,415 99,302 97, % North Perth T 2.0% 1,655,467,227 33,109, % 2, ,563 2, % Perth East Twp 40.0% 1,484,036, ,614, % 41,595 4,357 45,952 44, % Waterloo Region 100.0% 81,573,751,711 81,573,751, % 5,715, ,673 6,314,548 6,162, % Centre Wellington Twp 100.0% 4,031,002,059 4,031,002, % 282,452 29, , , % Erin T 49.0% 2,153,968,898 1,055,444, % 73,955 7,746 81,701 79, % Guelph C 100.0% 21,273,327,578 21,273,327, % 1,490, ,125 1,646,748 1,609, % Guelph Eramosa Twp 100.0% 2,267,426,720 2,267,426, % 158,879 16, , , % Mapleton Twp 95.0% 1,305,330,346 1,240,063, % 86,891 9,101 95,992 92, % Wellington North Twp 51.0% 1,353,028, ,044, % 48,351 5,064 53,415 52, % Puslinch Twp 75.0% 2,203,401,702 1,652,551, % 115,794 12, , , % Total 262,494,076, ,071,157, % 10,025,000 1,050,000 11,075,000 10,809, % DRAFT-September 23, Budget Questions? 28 14

73 Staff Report To Service Area City Council Corporate Services Date Wednesday, October 26, 2016 Subject Report Number 2017 Non-Tax Supported Operating and Capital Budgets CS Recommendation That Report No. CS titled 2017 Non-Tax Supported Operating and Capital Budgets be referred to the November 3, 2016 Council Budget meeting. 1. That for Water and Wastewater Services the following be approved: 1. Proposed expansion packages in the net amounts of $449,800 for Water Services and $54,800 for Wastewater Services; Water and Wastewater Services Operating Budgets in the amounts of $30,450,665 and $30,946,448 respectively, inclusive of expansions; Water and Wastewater Services Capital Budgets and Forecasts in the amounts of $180,151,100 and $137,829,500 respectively; 4. A City of Guelph water volume charge of $1.67 per cubic metre effective January 1, 2017 and a wastewater volume charge of $1.80 per cubic metre, effective January 1, 2017; 5. That the City of Guelph water and wastewater basic service charges remain consistent with 2016 as per the attached schedule "A" effective January 1, 2017; and 6. That the Water Services and Wastewater Services Fees and Services Bylaw be passed. 2. That for Stormwater the following be approved: 1. A 2017 Stormwater Services Operating Budget in the amount of $4,219,000; Page 1 of 12

74 2. A 2017 Stormwater Services Capital Budget and Capital Forecasts in the amount of $40,695, A City of Guelph stormwater fee of $4.00 per Equivalent Residential Unit effective January 1, 2017; and 4. That the Stormwater Fees and Services By-Law be passed. 3. That for Court Services the following be approved: 1. Proposed expansion package in the net amount of $64,300 for Court Services; 2. A 2017 Court Services Operating Budget in the amount of $3,901,750; and 3. A 2017 Court Services Capital Budget and Capital Forecasts in the amount of $ 504, That for Ontario Building Code Administration the following be approved: 1. A 2017 Ontario Building Code Administration Operating Budget in the amount of $3,390,300, and 2. The 2017 Ontario Building Code Administration Capital Budget and Capital Forecasts in the amount of $ 69, That for reserve and reserve funds the following be approved: The proposed transfers to/from reserves and reserve funds incorporated in the 2017 non-tax supported budget attached as Schedule B be approved. Executive Summary Purpose of Report To present the proposed 2017 Non-Tax Supported Operating and Capital Budgets for Council deliberation and approval. Key Findings All non-tax supported budgets utilize a strategy of sound financial planning combined with comprehensive financial management tools to ensure the appropriate levels of expenditure, reserve and reserve fund management, and sourcing of external funding. Page 2 of 12

75 2017 marks the first year Stormwater Services is a stand-alone non-tax supported budget, and the introduction of a stormwater fee. The dedicated funding will allow for increased service levels for stormwater maintenance, operations and capital programs The Stormwater Services budget previously funded from the tax supported budget was restated to show the transition from property tax in 2016 to stormwater equivalent residential unit (ERU) funding model in The ERU is a measure of the average number of square metres of impervious surface area of residential properties throughout the city. The ERU in Guelph is 188 square metres. The 2016 tax-supported budget was reduced by $1.9 million, which means the City will start 2017 with a base budget that is $1.9 million lower than its 2016 budget. Any increase to the City s budget in 2017 will be over the adjusted 2016 budget amount. The 2016 non-tax-supported budget was increased by approximately $2.1 million to provide Stormwater Services with a base budget 2017.The $200,000 difference between the tax-supported and non-tax-supported budgets is related to stormwater fees for City properties. Water and Wastewater budgets and corresponding rates are prepared to match the average of local water bills for the City's list of comparable municipalities, while ensuring regulatory compliance and progress towards financial and infrastructure sustainability. The 2017 capital projects are being shown as programs of work to demonstrate project interaction between City departments, and between tax supported and non-tax supported budgets. Financial Implications Based on the recommended changes to user fees and rates (Water, Wastewater and Stormwater), the average annual household impact is estimated at $46 based on the average annual water consumption of a three person household and the stormwater ERU. Water and Wastewater Services The proposed 2017 Operating and Capital Budgets align with the 2014 Water and Wastewater Long-Range Financial Plan and reserve fund policies and targets. The operating and capital requirements identified in the attached budget are funded through rates as outlined below. Page 3 of 12