Finance and Corporate Services

Committee Minutes

Monday, November 18, 2024 at 12:30 P.m. - 4:30 P.m.

Council Chambers - Hybrid

City of Kitchener

200 King Street W, Kitchener, ON N2G 4G7

Present:

• Mayor B. Vrbanovic
• Councillor S. Davey
• Councillor D. Schnider
• Councillor J. Deneault
• Councillor C. Michaud
• Councillor A. Owodunni
• Councillor P. Singh (virtually)
• Councillor B. Ioannidis
• Councillor M. Johnston
• Councillor D. Chapman
• Councillor S. Stretch

Staff:

• D. Chapman, Chief Administrative Officer
• M. May, General Manager, Community Services and Deputy Chief Administrator
• V. Raab, General Manager, Corporate Services
• J. Readman, General Manager, Development Services
• J. Lautenbach, Chief Financial Officer, Financial Services
• D. McGoldrick, General Manager, Infrastructure Services
• R. Hagey, Director, Financial Planning
• D. Andrade, Manager, Budgets & Financial Reports
• D. Saunderson, Deputy Clerk
• M. Blake, Committee Coordinator

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1.

Commencement

The Special Finance and Corporate Services Committee held a meeting this date commencing at 12:37 p.m.

1.1

Meeting Video / Livestream

NOTE: Due to technical difficulties the video for Finance and Corporate Services November 18, 2024 is incomplete, the video posted is the only available recording of this meeting.

2.

Disclosure of Pecuniary Interest and the General Nature Thereof

2.1

Councillor S. Stretch - Kitchener Public Library (KPL)

Councillor S. Stretch declared a conflict with Item 3.1.c.a Kitchener Public Library, due to a family member being employed by the organization, and did not participate in any voting or discussion related to the matter.

3.

Discussion Items

3.1

2025 Operating Budget, FIN-2024-495

It was noted Final approval of the 2025 Operating Budget will take place as part of Final Budget Day, scheduled for December 12, 2024.

3.1.a

General Overview by the Chief Financial Officer

J. Lautenbach provided an overview of the Budget process. J. Lautenbach stated for the 2025 Budget, staff would be providing presentations on the Operating and Capital Budget on November 18 and 25, 2024, which would be followed by the Mayor formally tabling the Budget on December 2, 2024, and Final Budget Day on December 12, 2024.  

Councillor P. Singh entered the meeting at this time.  

J. Lautenbach provided an overview of the 2025 Operating Budget, noting the 2025 budget priorities include: the delivery of City services, investing in infrastructure, and advancing strategic priorities.  J. Lautenbach stated the operating budget highlights $559 million expenditures in total (tax supported and enterprises), $276 million expenditures excluding enterprises (tax supported), and the annual delivery of programs and services for the community. 

3.1.b

Recess and Reconvene

The Finance and Corporate Services Committee then recessed at 1:10 p.m. and reconvened at 1:48 p.m., Chaired by Councillor S. Davey, with all members present.

3.1.c

Boards

3.1.c.a

Kitchener Public Library (KPL)

• Councillor S. Stretch declared a conflict on this item. (Councillor S. Stretch declared a conflict with Item 3.1.c.a Kitchener Public Library, due to a family member being employed by the organization, and did not participate in any voting or discussion related to the matter.)

D. Soloman, Kitchener Public Library (KPL) was in attendance to provide an overview of the 2025 KPL Budget. A. Riddell, L. Lee, K. Johnson-Perlock, N. Stretch and L. Lawrence were also in attendance to respond to questions from the Committee.

D. Soloman stated the 2025 KPL Operating Grant increased 2.6% to $14.2M., including $1,181,000 for the new Southwest Library. D. Soloman noted other library generated revenues increased by $23,000 and union negotiations are currently in progress.

In response to questions from the Committee, D. Soloman noted KPL will be launching "Library Lockers" at Chandler Mowat Community Centre and Victoria Hills Community Centre. 

3.1.c.b

Centre in the Square (CITS)

D. Carli, J. Henning and S. Cook, Centre in the Square (CITS) were in attendance to provide an overview of the 2025 CITS budget and to respond to questions from the Committee. D. Carli noted the 2025 budget includes an operating grant increase of 2.6% as per City guidelines, from $2.084M to $2.138M. D. Carli stated the 2025 new investment is aligned with the 4 pillars of growth strategy: destination, community engagement, capacity building, and branding.

Councillor M. Johnston left the meeting at this time. 

3.1.d

Strategic Addition Discussion

Councillor M. Johnston returned to the meeting at this time.  

R. Hagey provided an overview on the Strategic Investment options, stating there is $1M of one-time funding available in the Capital Budget for Council to allocate to an area of strategic priority. R. Hagey noted while no specific options have been recommended by staff, priority areas for investment have been identified as: City facilities, outdoor recreation, and the corporate climate action plan. R. Hagey stated the Strategic Item Issue Papers Op-01 (Strategic Additions) and Op-02 (Strategic Spending Options) have been included in the 2025 Budget as Appendix G. 

Councillor P. Singh left the meeting at this time. 

3.1.e

Recess and Reconvene

The Finance and Corporate Services Committee then recessed at 3:14 p.m. and reconvened at 3:24 p.m., Chaired by Councillor S. Davey, with all members present except Councillor P. Singh.

3.1.f

Tax Supported Operating Budget

Councillor P. Singh returned to the meeting at this time.  

R. Hagey provided an overview of the proposed tax rate increase of 3.9%, highlighting the primary cost increases to the City’s core services in 2024, including: employee salary and wages, materials (fuels, parts, salt), transfers to others (Boards and grants), and funding for capital projects. It was noted that the Budget changes by division can be seen in Appendix B. R. Hagey further advised the proposed tax rate increase, including utility rate increases, are anticipated to have an $131 Impact on the average household in 2025,  

R. Hagey noted the assessment growth of 1.75% does not entirely cover the impacts of growth and strategic priorities, as inflation continues to impact the cost of delivering City services. 

R. Hagey noted the 2025 user fees are increasing by 4%, which is in line with inflation, and the complete user fee schedule can be found in Appendix E. R. Hagey also noted exceptions to the user fee schedule can be seen in Issue Paper Op-03 (2025 User Fees). 

R. Hagey confirmed the City collects all of the property taxes for itself, the Region and local School Board. Further, the City’s portion of the tax bill is 30%, with the Region of Waterloo and the local School Boards making up 58% and 12% respectively. 

Questions were raised regarding the potential for the City to increase communication to residents regarding the budget, specifically related to taxes and how the funding is allocated to the City, Region of Waterloo and School Boards. D. Chapman, Chief Administrative Officer, noted further conversation regarding the Committee’s expectations, and a staff communication plan can occur at the November 25, 2024 Capital Budget Meeting.  

3.1.g

Enterprise Operating Budgets

R. Hagey provided an overview of the City’s enterprises, noting enterprises are self-sufficient business lines that raise their own revenues through user rates instead of being funded through property taxes. The 7 enterprises include: building, golf, parking, water sanitary, stormwater and gas. 

R. Hagey then provided an overview of each of the 7 enterprises and their 2025 operating budgets, which included a budget and 5-year forecast. R. Hagey advised that the combined annual Water Infrastructure Program (WIP) rate has an increase of 6.3% over next four years to fund planned workplan. R. Hagey further advised that there is an Issue Paper Op-05 (Additional Support for Environmental Requirements) related to full time equivalent (FTE) staffing for the sanitary stormwater utility. 

• On motion by Councillor B. Ioannidis

  "That the 2025 Operating Budget as outlined in Financial Services Department report, FIN-2024-495, be received for information."

  Carried

4.

Adjournment

On motion, this meeting adjourned at 4:22 p.m.

 

Mariah Blake

Committee Coordinator