Finance and Corporate Services

Committee Minutes

Monday, November 29, 2021 at 9:30 A.m. - 12:30 P.m.

Electronic Meeting

Present:

• Mayor B. Vrbanovic
• Councillor S. Davey
• Councillor D. Schnider
• Councillor J. Gazzola
• Councillor C. Michaud
• Councillor K. Galloway-Sealock
• Councillor P. Singh
• Councillor B. Ioannidis
• Councillor M. Johnston
• Councillor D. Chapman
• Councillor S. Marsh

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
• L. MacDonald, City Solicitor
• B. Rowland, Director, Corporate Communications and Marketing
• C. Tarling, City Clerk
• D. Murray, Director, Technology Innovation and Services
• P. Dunn, Director, Human Resources
• B. Lam, Director, Sanitary & Stormwater Utility
• G. St. Louis, Director, Utilities
• N. Lobley, Director, Parks and Cemeteries
• K. Kugler, Director Sport
• A. Qureshi, Director, Facilities Management
• D. Miller, Director, Fleet
• B. Cronkite, Director, Transportation Services
• P. McCormick, Manager, Parking Enterprise
• D. Saunderson, Deputy Clerk
• S. Goldrup, Committee Administrator

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1.

Commencement

The Finance and Corporate Services Committee held an electronic meeting this date, commencing at 9:33 a.m., Chaired by Councillor S. Davey.

2.

Discussion Items

2.1

FIN-2021-60 - 2022 Capital Budget and 10-Year Forecast

2.1.a

Overview by Chief Financial Officer

J. Lautenbach provided opening remarks and an overview of the budget process. J. Lautenbach reviewed the capital program, asset categories, forecasted projects, and funding sources. J. Lautenbach highlighted the need to address infrastructure projects over a longer time horizon; the projects identified and prioritized in the Capital Budget and their alignment with the City’s Strategic Plan; and, the leveraging of grant funding to advance strategic initiatives. In response to the Committee’s questions, J. Lautenbach discussed monitoring and timing of capital projects. 

2.1.b

Boards

R. Hagey reviewed the Capital forecast for the Centre in the Square and Kitchener Public Library. In response to questions from the Committee, R. Hagey spoke to the Centre and the Square's projected surplus and how the funds are allocated in the organization's capital reserve. 

2.1.c

Capital Funding Sources

R. Hagey reported the funding sources for the ten-year forecast of the Capital Budget. R. Hagey noted the increase in funds due to previous adjustments to Capital projects despite the decrease in Development Charges and Grant Funding. Further, R. Hagey spoke to the Capital Pool and reviewed trends over the ten years. R. Hagey explained that Capital projects are fully funded, the proposed Capital Budget is currently balanced, and described the implications of adjusting the Capital Budget on increasing tax rates or debt. 

In response to questions from the Committee, R. Hagey spoke to the logistics of adding additional funding for affordable housing initiatives, the considerations and circumstances through which debt might be issued for the City to acquire an asset, such as affordable housing, which another organization might manage.  

2.1.d

Debt

R. Hagey reviewed the City's outstanding debt and confirmed the City's debt level is within the target range in terms of debt to the tax levy, per household, or debt to reserves. In response to questions from the Committee, R. Hagey spoke to the taxy levy increase assumed in the City's projections. The Committee requested additional information regarding current interest rates, past trends, and forecasts. 

2.1.e

Reserve Funds

R. Hagey spoke to Reserve Funding balances, the ratings and projections for each fund, and noted which reserves were being monitored by staff. R. Hagey confirmed Reserve Funds overall were projected to be above the minimum balance at the end of 2021 and 2022. In response to questions from the Committee, R. Hagey confirmed staff would provide further information about the use of the Energy Retrofit Fund. Staff further spoke to the legislation and policy governing the use of reserve funds. 

2.1.f

Development Charges

R. Hagey explained the recent changes to the handling of Development Charges (DC), DC projections, and the updated DC By-law and rates, which will return to the Committee in 2022. In response to questions from the Committee, R. Hagey discussed support for affordable housing, the development of rental units, and the deferral of DC fees. Further, R. Hagey reviewed the projects funded by DC fees. 

2.1.g

Capital Budget Format

R. Hagey introduced the Capital Budget Pages, which included the capital forecast and investment options, highlights of changes to the capital forecast, and issue papers. The Committee discussed the potential Capital Investment options for affordable housing, facility infrastructure, and community trails and requested that staff investigate other funding options that might be leveraged to allocate 2M or 3M in funding.  R. Hagey confirmed the community feedback on the potential opportunities for Capital Investment would be circulated in advance of the final budget meeting.

2.1.h

Capital Forecast and Issue Papers

R. Hagey highlighted budget changes. In response to questions from the Committee, staff discussed cost considerations for print shop operations, the corporate planning process and sources of funding, and the ongoing work to advance the Reconciliation Action Plan and contributions from area municipalities. Further, staff discussed Council technology, LoveMyHood funding sources and program implementation, and confirmed staff would complete the Ice Needs Assessment in 2023. Staff spoke to funding for studies supporting purpose-built rental housing development and affordable housing. Additionally, staff described funding for traffic calming signage, consideration of the Bramm Street lands in the future Leisure Facilities Master Plan, and acquiring, converting, or managing lands for park spaces. 

Mayor B. Vrbanovic left the meeting at this time.

Responding to the Committee's questions, staff reviewed funding allocations for front desk resourcing at City Hall, funding sources for Capital Forecast projects, and streetscape improvements in the downtown core and property standards considerations.

Councillor S. Davey left the meeting and Councillor K. Galloway-Sealock assumed the role of Chair. 

In response to a request, staff confirmed additional information would be provided regarding the staff contribution and long-service recognition program, implementing the Transform WR initiatives, and the implications of the request for the Social Development Centre Waterloo Region.

Councillor S. Davey returned to the meeting and resumed the role of Chair. 

2.1.i

Resolution

• On motion by Councillor D. Schnider

  “That staff be directed to report and/or take appropriate action on the following matters arising from the November 29, 2021 Special Finance and Corporate Services Committee meeting relative to the 2022 Capital budget, as outlined in the chart below: 

  DIVISION/AREA	TOPIC	ACTION
  FINANCIAL PLANNING	Reserves – Energy Retrofits	Provide information regarding the allowable uses for the Energy retrofit reserve fund, and what it is allocated for.
  FINANCIAL PLANNING	General	Circulate information about the review of staff recognition that was conducted a few years ago and what is planned going forward.
  PLANNING	Affordable Housing (and other capital options)	Provide additional information on how to fund an additional $1M-$2M for affordable housing (or the other capital options), options could include: - Review the impacts of a special levy be for affordable housing. - Consider options for issuing debt, what would the principle & interest costs be, and what is staff's opinion of adding debt for this purpose. - Provide additional information on past, present, and future debt interest rates. - Look at options to partner with Kitchener Housing. - Consult with the School Board to see whether they would consider waiving their Development Charges for affordable housing.
  PLANNING	Affordable Housing	Provide information about the availability of staffing/consulting resources related to a review of policy to accelerate purpose-built rentals.
  PLANNING	Heritage	Provide information about the different heritage capital accounts and what they fund.
  COMMUNITY SERVICES	Grant Funding Request	Provide information about the Social Development Centre grant funding request.
  DEVELOPMENT SERVICES	Transportation Services	Provide information about the costs of adding three new, flexi-delineator signs in each ward for small scale traffic calming and whether a budget increase is required to accommodate.
  DEVELOPMENT SERVICES	Corporate Sustainability Office	Provide information about the efforts of the City to meet the Transform WR recommendations."

  Carried

3.

Adjournment

On motion, this meeting adjourned at 1:25 p.m.