2017 Draft Operating Budget Update - Richmond Hill, Ontario · PDF file2017 Draft Operating Budget . Update . ... the upcoming year. ... On a divisional basis in each section of the

2017 Draft Operating Budget Update

Budget Committee of the Whole Tuesday, February 14, 2017

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Overview 1. Proposed Operating Budget – January 24, 2017 2. Councillor Motions and Staff Responses

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Proposed Operating Budget 2017 Tax Levy Impact Town

Services

RH Fire & Emergency

Services

Richmond Hill Public

Library

Total Operating

Budget Base $1,023,100 $1,131,600 $206,300 $2,361,000 Growth 401,100 - 285,700 686,800 Legislated 221,400 - 24,400 245,800 Service Enhancements 125,000 344,600 - 469,600 Unsustainable Funding Sources 1,033,400 - - 1,033,400 2017 Draft Operating Budget – Tax Levy Impact $2,804,000 $1,476,200 $516,400 $4,796,600

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2017 Average Single Detached Residential Property Single Detached Residential Property New Current Value Assessment – $1,148,000

Estimated Town Services

Fire & Emergency

Services

Library Services

Town Portion of Tax Bill

Annual Tax Impact $48.50 $25.65 $8.90 $83.05

Monthly Tax Impact 4.04 2.14 0.74 6.92

Daily Tax Impact 0.13 0.07 0.03 0.23

2017 Tax Bill $1,827.84

Mayor Barrow’s Motion

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“That the new staff requests from the Richmond Hill Public Library Board for the new Oak Ridges Library in the 2017 draft operating budget be limited to 2 (two) new positions and the Board make the decision of which 2 (two) positions they wish to add. The start time to be the same July 1st start.”

Mayor Barrow’s Motion

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Library Board has not yet provided feedback on positions to be deferred. Staff have provided a reduced tax impact of $71,800 based on retaining the two highest rated positions, the Children’s Librarian and the Library Systems Specialist, and deferring the Library Assistant and part-time Page hours.

Updated Tax Levy Impact $4,724,800 or $81.66 per average household

Councillor Beros’ Motions

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1. “That any new staff positions be frozen until such time that all technology projects are complete and an analysis of the new processes and productivity enhancements have been reported to council.” Positions requested to maintain existing services or provide for

Council approved initiatives. The majority of requests are not related to system upgrade projects

The total 2017 cost of the 31 full-time positions and casual wages would be $1.9 million of which $1,347,100 would be tax rate funded and reduce the bottom line tax impact if this motion was approved.


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2. “That the farmers market either break even or be discontinued.” The 2017 draft operating budget provides $8,800 net cost for

the Farmer’s Market that impacts the bottom line.


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3. “That all non-labour budget lines be frozen at 2016 rates unless the 2017 draft is proposed to be lower.” If this motion is approved, the financial implication is over $2.8 million

reduced tax impact. Implementation would be difficult as budget would not allow for:

a) Cost increase provisions out of staff’s control (e.g. hydro) b) Commitments to procured contractual cost increases c) Contract and material cost impacts of the growing community d) Cost provisions for time and material contracts based on estimated

number of occurrences (e.g. waste contract and salt contract) Of the total non-personnel costs of $57.6 million, over 90% are non-

discretionary based on existing contracts or impacts out of staff’s control


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4. “That all town-owned buildings that are leased out, be done so at market rates and utility bills be paid 100% by the user.”

Require clarification of leases that are of concern. Many lease

arrangements are multi-year commitments that may not be readily renegotiable until after expiry.


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5. “That a Zero based budget approach be implemented for the 2018 budget and that the capital and operating budget be done simultaneously to show the effects one has on the other.”


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The Town’s current annual budget development and review is a Zero-Based approach with consideration to only what is needed for the upcoming year. This is a thorough and detailed process.

Combining the Capital & Operating Budget reviews will result in significant process and timing changes to many of the financial planning & reporting functions, affecting staff throughout the organization. If this is the direction, staff would need to report back as part of the 2018 Budget Strategy in early spring.


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6. “That the budget once approved is displayed to the public in a fashion that makes it clear as to what sources of money fund the listed operations.”


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Currently the Town provides funding source information: On a divisional basis in each section of the budget binder On an overall corporate basis (page 22 of the Corporate

Overview tab) Staff will continue to provide this information on the Town’s

website

Updated Tax Levy Impact $717,200 or $12.39 per average household

Councillor Muench’s Motions

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1. “That staff track internal and external resources (human and financial) utilized to manage and execute the OMB cases by file number and submit an annual report to Council during the budget process outlining the activities for the previous 3 years and current year.” The Town’s OMB costs for 2014 to 2016 have been $1.3 million

(2014 – $714,255, 2015 – $223,651, 2016 – $367,094) The Town maintains an OMB Reserve to fund these costs The final budget report for February 28, 2017 will provide

greater detailed update


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2. “That the Chief Administrative Officer report back to the Budget Committee on ways in which the Town can strengthen its financial oversight and offer additional performance assistance to the Town of Richmond Hill community partners allowing Town of Richmond Hill goals to be achieved.

a) Community partners are organizations that offer a service to Richmond Hill residents but operate independently while utilizing significant Town Assets (Human, Equipment and/or capital assets) when compared to their own investment.


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b) Community partner organizations are agencies, associations, profit and not for profit bodies who currently do not have financial oversight such as audits given to the Town.

c) Community partner organizations provide a service to residents that utilize significant Town Assets (Human and Capital) with budgets required in excess of $ 50,000 or service more than 100 residents

Staff will report back to a future BCW meeting


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3. That the Chief Administrative Officer develop a Municipal Price Index (MPI), which is a benchmark similar in comparison to the Consumer Price Index (CPI) but for Municipalities.

a) The MPI will be used to benchmark and assign future operating budget size increases range for three fiscal years with semi annual adjustments possible going forward.

b) The MPI will be the multiplier factor from the previous year’s operating budget and is a mathematical formula which will be used to establish future budget sizes.

c) Note this index will have a +/- range of 1% and can only be changed with an 2/3 vote of Council.


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Staff will review the MPI approach, consult with other municipalities, and report back to BCW as part of the 2018 Budget Strategy

Currently the Town uses a Zero-Based Budget approach which is a detailed approach.


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4. “That all outside contractors, consultants and vendors have measurable performance criteria build into each tender and contract allowing quantitative performance targets to be measured and achieved. These performance targets will be established prior to commencement of any contract and will be the factor for performance and penalty system evaluation. The benchmarks will be created to allow the Town of Richmond Hill to receive agreeable performance standards on each supplier relationship.”


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Town’s competitive process currently allows for qualitative and quantitative analysis of vendor responses Staff currently measure supplier performance As part of the recently approved Procurement By-Law update,

formal Project and Supplier Performance Management was further encouraged

Procurement staff are developing formal procedural document to provide guidance to the organization as well as an e-Tendering tool (live in the fall), that will allow for evaluation be completed and shared on-line to further simplify the process

Tax Levy Impact $4,796,600 or $83.05 per average household

Councillor Chan’s Motions

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“That Council exercises fiscal restraint to minimize increase in the tax rate for 2017 and future years to include new hires only for the following positions in the 2017 Operating Budget for the rationale as shown: Community Services Department – Firefighters (4) to stagger the recommended hiring of 8 firefighters over two years to minimize the fiscal impact on the annual Operating Budget while staffing the Rescue Truck with four firefighters that will increase the number of firefighters that assemble on scene, which will help achieve NFPA 1710 that states fourteen firefighters should arrive on scene within an eight minute travel time.


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Environment and Infrastructure Services – Department Manager, Asset Management Planning to enable the implementation of the Town’s corporate Asset Management Plan and help the Town to make the best possible decisions about the over $1.85 billion in infrastructure assets that are key to maintaining the quality of life in Richmond Hill. Office of the Chief Administrative Officer – Manager, Economic Development to implement the Economic Development Strategy as approved by Council and is consistent with the need for a full-time management position dedicated to promoting economic development as recognized by the majority of Greater Toronto Area municipalities.


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Planning and Regulatory Services – Department Bylaw Policy Officer as the Town must have the capacity to reconcile the outdated and archaic By-laws to keep pace with modern changes driven by technological changes. Public Library Board 2 positions to serve the new Oak Ridges Library.”


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By only including 9 of the 31 total full-time requests, the tax impact is reduced by $ 991,500

Although less impactful than the previous staffing motion, this limits staff’s ability to accomplish the work-plan requirements for 2017 and 2018, and challenges the ability to continue to maintain existing services to the growing community

Updated Tax Levy Impact $3,821,300 or $66.13 per average household

Staffing Requests

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Operating Budget Description 2017 Tax Impact

2018 Tax Impact

Town Services Manager, Asset Management Planning (10,700) - Town Services Manager, Economic Development 72,600 74,700 Town Services By-Law Policy Officer 46,700 50,400

RHFES Fire Fighters (4) 151,600 330,400 RHPL Children’s Librarian 41,400 TBC RHPL Library Systems Specialist 40,900 TBC

Included in Councillor Chan’s staffing motion:

Staffing Requests

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2018 Tax Impact

RHPL Oak Ridges Pages (85 part-time hours) 38,600 77,500 RHPL Oak Ridges Library Assistant 33,200 TBC RHPL Richmond Green Librarian (part-time) 16,100 35,800

RHFES Fire Fighters (4) 151,600 330,400 RHFES Fire Prevention Officer 33,400 66,400

Excluded from Councillor Chan’s staffing motion:

Staffing Requests

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2018 Tax Impact

Full-Time Permanent Staffing Request Town Services Department Assistant (Zoning), Sept start 20,200 44,200 Town Services Manager Development (Zoning), July start 72,600 78,700 Town Services Senior Planner – Zoning, Sept start 34,400 74,500 Town Services Planner I – Zoning, November start 13,400 70,900 Town Services Urban Designer (Senior Planner), July start 51,000 57,200 Town Services By-Law Officer, July start 53,500 49,100 Town Services Project Manager, Strategic Initiatives, July

start 64,600 66,100

Town Services Capital and Development Finance Advisor, July start

- -

Town Services Facility Coordinator 48,300 50,800 Town Services Capital Project Coordinator 52,100 54,700

Staffing Requests

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2018 Tax Impact

Full-Time Permanent Staffing Town Services Energy and Waste Manager 77,200 79,700 Town Services Asset Management – Project Manager 22,500 111,500

Conversions (PT to FT or Change) Town Services Integration Services Assistant 9,100 19,800 Town Services Children and Outdoor Recreation Program

Assistant (500) 10,500

Town Services Legislative & Accessibility Coordinator (17,300) 51,100 Town Services Access and Privacy Officer 12,700 51,100 Town Services Dir, By-Law Licensing & Enforcement

(Management Review) 24,100 156,200

Staffing Requests

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2018 Tax Impact

Seasonal, Casual and Contract Extensions Town Services Parks Operations - casual/seasonal

labourers 127,200 2,500

Town Services Project Coordinator (two contract extensions – Development Engineering)

- -

Town Services Powerstream Energy Coordinator 8,900 11,500 Town Services Asset Management - Project Manager

(contract extension) - -

Discussion

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Documents

2017 Draft Operating Budget Update - Richmond Hill, Ontario · PDF file2017 Draft Operating Budget . Update . ... the upcoming year. ... On a divisional basis in each section of the