ADDENDUM SPECIAL COUNCIL MEETING

BOARD ROOM, SERVICE AND RESOURCE CENTRE, DUNSMUIR STREET, NANAIMO, BC

MONDAY, 2016-DEC-19, AT 10:00 A.M.

[NOTE: The open portion of this meeting will only continue until 12:00 p.m. Any items not considered will be put on a future meeting agenda.]

PAGES

5. PRESENTATIONS:

(a) Remove presentation - Downtown Nanaimo Business Improvement Association Budget Presentation, and the delegations from Tim McGrath and Dave Lawrence.

(b) Remove presentation - Nanaimo Economic Development Corporation

Budget 2017, and the delegation from Tim McGrath.

7. ADMINISTRATION:

(b) 2017 Federation of Canadian Municipalities Resolutions

Purpose: To present for Council’s consideration, a resolution for submission to the Federation of Canadian Municipalities for consideration at the 2017 Annual Conference and Trade Show.

Staff Recommendation: That Council: 1. adopt the resolution to change the Nanaimo Port Authority lease

rate structure to reflect a fair market value approach. 2. direct Staff to submit the adopted resolution to the Federation of

Canadian Municipalities for consideration at the 2017 Annual Conference and Trade Show.

Pg. 3-5

8. CORPORATE SERVICES:

(b) 2017-2021 Financial Plan Bylaw – replace pages 97-103 of the Agenda with the attached pages (entire report and “Financial Plan Bylaw 2016 No. 7234”).

Pg.6-12

9. COMMUNITY SERVICES:

(b) Remove report - Schedule D – Density Bonus Review – ZA1-23.

ADDENDUM – COUNCIL 2016-DEC-19 PAGE 2

(d) Development Variance Permit No. DVP297 – 3736 Belaire Drive – add the following delegations:

1. Mr. Keith Brown 2. Mr. Ronald Ford

(e) Remove report – Safe Injection Site, and presentation by Dr. Paul Hasselback, Medical Health Officer Central Vancouver Island, Island Health.

14. OTHER BUSINESS:

(a) Mayor McKay Notice of Motion re: Siting of Medical Marijuana Dispensaries – add the following delegations:

1. Mr. Matthew O’Donnell 2. Mr. Richard Scott 3. Mr. Trevor Heshka

17. PROCEDURAL MOTION:

Add - That the meeting be closed to the public in order to deal with agenda items under the Community Charter:

Section 90(1) A part of a Council meeting may be closed to the public if

the subject matter being considered relates to or is one or more of the following:

(b) personal information about an identifiable individual who is being considered for a municipal award or honour, or who has offered to provide a gift to the municipality on condition of anonymity;

(e) the acquisition, disposition or expropriation of land or improvements, if the Council considers that disclosure could reasonably be expected to harm the interests of the municipality;

(g) litigation or potential litigation affecting the municipality; (k) negotiations and related discussions respecting the proposed provision

of a municipal service that are at their preliminary stages and that, in the view of the Council, could reasonably be expected to harm the interests of the municipality if they were held in public;

(n) the consideration of whether a Council meeting should be closed under a provision of this subsection or subsection (2); and,

Section 90(2): (b) the consideration of information received and held in confidence relating

to negotiations between the municipality and a provincial government or the federal government or both, or between a provincial government or the federal government or both and a third party.

Staff ReportFile Number: 0230-01

DATE OF MEETING December 19, 2016

AUTHORED BY SHEILA GURRIE, ACTING CITY CLERK

SUBJECT 2017 FEDERATION OF CANADIAN MUNICIPALITIES RESOLUTIONS

OVERVIEW

Purpose of ReportTo present for Council’s consideration, a resolution for submission to the Federation of Canadian Municipalities for consideration at the 2017 Annual Conference and Trade Show.

RecommendationThat Council:

1. adopt the resolution to change the Nanaimo Port Authority lease rate structure to reflect afair market value approach.2. direct Staff to submit the adopted resolution to the Federation of Canadian Municipalities forconsideration at the 2017 Annual Conference and Trade Show.

BACKGROUND

The Federation of Canadian Municipalities (FCM) 2017 Annual Conference and Trade Show is being held from 2017-JUN-01 to 04 in Ottawa, Ontario. As part of the Annual Conference, FCM invites its members to submit resolutions on subjects of national municipal interest that fall within federal government jurisdiction. The deadline for receipt of resolutions is 2017-JAN-09.

At the Committee of the Whole Meeting held 2016-DEC-12, Council directed Staff to prepare a draft resolution for Council consideration regarding the Nanaimo Port Authority lease rate structure.

OPTIONS

1. That Council:

1. adopt a resolution to change the Nanaimo Port Authority lease rate structure toreflect a fair market value approach; and,

2. direct Staff to submit the adopted resolution to the Federation of CanadianMunicipalities for consideration at the 2017 Annual Conference and Trade Show.

2. That Council provide alternate direction.

CITY OF NANAIMO

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Special Council Meeting Addendum2016-DEC-19

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Staff Report December 19, 2016 2017 FEDERATION OF CANADIAN MUNICIPALITIES RESOLUTIONS

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SUMMARY POINTS

• The FCM 2017 Annual Conference and Trade Show is being held from 2017-JUN-01to 04 in Ottawa, Ontario.

• FCM invites its members to submit resolutions on subjects of national municipal interest that fall within federal government jurisdiction for consideration at the Conference; the deadline for submissions is 2017-JAN-09.

• Council has requested a resolution with respect to fair market marina lease rates be submitted to FCM for consideration.

ATTACHMENTS

Attachment A: Draft Resolution

Submitted by:

CITY OF NANAIMO

Sheila Gurrie, A/City Clerk

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ATTACHMENT A

MARINA LEASE RATES

WHEREAS under the Canada Marine Act the Nanaimo Port Authority is required to set the lease rate

structure fo r water lots at market value.

WHEREAS the Nanaimo Marina Owners contest that the Nanaimo Port Authority lease rates structure

does not represent a fa ir market approach;

WHEREAS the Nanaimo Marina Owners recommend a fa ir market model based on a business owners'

income;

THEREFORE BE IT RESOLVED tha t the Federation o f Canadian Municipalities work w ith the Nanaimo Port

Authority to develop a lease fee model tha t is based on a fa ir market approach.

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Staff Report

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DATE OF MEETING December 19, 2016

AUTHORED BY VICTOR MEMA, CHIEF FINANCIAL OFFICER,DEBORAH DUNCAN, DEPUTY DIRECTOR, FINANCIAL SERVICES

SUBJECT 2017 – 2021 FINANCIAL PLAN BYLAW

OVERVIEW

Purpose of Report To introduce “Financial Plan Bylaw 2016 No. 7234”.

Recommendation That Council receive for information the report pertaining to “Financial Plan Bylaw 2016No. 7234”.

BACKGROUND

The financial plan process is informed by policies and plans endorsed by Council, including theOfficial Community Plan (OCP) and the Strategic Plan. In compliance with the Community Charter, the Financial Plan is developed through public consultation and Council direction. Priorto May 15th each year, Council must adopt both a Five Year Financial Plan bylaw and a Property Tax Rates bylaw. Council may adopt a Five Year Financial Plan bylaw earlier to allowthe City to proceed in a timely manner to work on programs and capital projects. This bylaw isreferred to as the Provisional Financial Plan pending adoption of the Final Financial Plan byMay 15th of each year.

In 2013, Council approved an annual 1% increase in property taxes for five years ending 2017,and annual increases to sanitary sewer and water fees for contributions to asset managementreserve funds. These reserves fund many asset renewal projects.

The Draft 2017 – 2021 Financial Plan presented to Council at the 2016-OCT-04 Finance andAudit Committee meeting indicated the following property tax increases: 2.4% in 2017, 1.0% in2018, 0.9% in 2019, 1.0% in 2020 and 0.5% in 2021. Budget review with Council continued atthe 2016-NOV-01 and 2016-NOV-16 Finance and Audit Committee meetings. Publicconsultation has included an eTown Hall on 2016-JUL-25 focused on strategic priorities and apresentation at the 2016-DEC-12 Committee of the Whole meeting.

Staff has undertaken a review and analysis of budget proposals that would provide for additionalfunding for future capital projects: Transition annual Casino revenues ($2.4m) from general revenues to general reserves over

the next four years. This would provide an additional funding source for capital projects. Transition annual Fortis revenues ($525,000) from general revenues to general reserves in

2017. This would provide an additional funding source for future projects. Reduce the budget estimate for the RCMP contract from 95% to 92% in 2017. This would

more closely reflect actual staffing levels and minimize annual surpluses for this contract. Reduce the funding from general revenues for capital projects for next two years only.

Special Council Meeting Addendum2016-DEC-19

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Staff Report December 19, 2016 2017 – 2021 FINANCIAL PLAN BYLAW

Page 2

The above changes when fully implemented enable additional contributions of $2.9m to general reserves to fund capital projects.

Additional changes include:

Reduction in the City’s annual budget for economic development to reflect ongoing changes to the service delivery model. Total reduction $391,000

Reduction in annual City funding for the Downtown Nanaimo Business Improvement Area (DNBIA). This funding is in addition to the City’s collection of Business Improvement Area (BIA) levies for the DNBIA. The City’s matching funding is reduced from 100% to 50%. Total reduction $117,000.

The projected property tax increases in the 2017 – 2021 Financial Plan are:

Water user fees annual increase is 7.5% including 2.5% for increased contribution to asset management reserve. Sewer user fees annual increase is 5% in 2017, then 4% for 2018 to 2021. Solid waste collection user fee increases 2% in 2017 pending Council’s decision regarding automated collection. Council will have opportunities to review and amend the 2017 – 2021 Financial Plan in April prior to final adoption of the Property Tax Rates Bylaw. Adopting the 2017 – 2021 Financial Plan Bylaw authorizes expenditures in the 2017 budget and allows the City to proceed in a timely manner to work on programs and capital projects.

OPTIONS

1. That Council receive for information the report pertaining to “Financial Plan Bylaw 2016 No. 7234”.

Budget Implication: Adopting the Provisional 2017 – 2021 Financial Plan Bylaw authorizes the expenditures in the 2017 budget and allows the City to proceed to work on programs and capital projects.

Legal Implication: Adoption of the budget bylaw ensures that spending is within legal limits.

Strategic Priorities Implication: Taking Responsibility to be an excellent municipal government is a Council priority.

2. Table the report and request more information from Staff. Expenditures will not be within approved budgets.

SUMMARY POINTS

Prior to May 15th each year, Council must adopt both a Five Year Financial Plan bylaw and a Property Tax Rates bylaw.

The Financial Plan Bylaw 2016 No. 7234 allows the City to proceed in a timely manner to work on 2017 programs and capital projects.

2017 2018 2019 2020 2021

2017 - 2021 Financial Plan 1.5% 1.6% 1.9% 1.5% 0.4%

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Staff Report December 19, 2016 2017 – 2021 FINANCIAL PLAN BYLAW

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Council will have opportunities to review the 2017 – 2021 Financial Plan in April prior to adoption of the Property Tax Rates Bylaw.

ATTACHMENTS “Financial Plan Bylaw 2016 No. 7234”

CITY MANAGER COMMENT:

I concur with the staff recommendation.

Submitted by:

______________________ Deborah Duncan Deputy Director, Financial Services

Concurrence by:

______________________ Victor Mema Chief Financial Officer

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CITY OF NANAIMO

BYLAW NO. 7234

A BYLAW TO CONFIRM AND ADOPT THE FINANCIAL PLAN

The Municipal Council of the City of Nanaimo in open meeting assembled, ENACTS AS FOLLOWS: 1. Title

This Bylaw may be cited as the “FINANCIAL PLAN BYLAW 2016 NO. 7234”.

2. Schedule “A” attached hereto and forming part of this Bylaw is hereby adopted and is

the Financial Plan for the City of Nanaimo for the period 2017-JAN-01 to 2021-DEC-31. 3. The various items of expenditure set forth in Schedule “A” are hereby authorized. 4. Schedule “B” attached hereto and forming part of this Bylaw is hereby adopted and is

the Statement of Revenue Objectives & Policies for the City of Nanaimo for the period 2017-JAN-01 to 2021-DEC-31.

5. The Financial Plan may be amended in the following manner:

(a) Funds may be reallocated in accordance with the City of Nanaimo's management

policy on budget transfers. (b) The Director of Finance may transfer unexpended appropriations to Reserve

Funds or Reserve Accounts for future expenditures.

PASSED FIRST READING __________________ PASSED SECOND READING _______________ PASSED THIRD READING _________________ ADOPTED _______________________________

MAYOR

CORPORATE OFFICER

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Bylaw No. 7234 Page 2

Schedule ACity of Nanaimo2017 - 2021 Financial Plan

2017 2018 2019 2020 2021

Revenues:Revenue from Property Value Taxes 99,983,693 102,868,607 106,062,538 108,995,422 110,787,043 Revenue from Parcel Taxes 234,242 236,584 - - - Revenue from Fees & Charges 40,006,119 41,795,057 43,697,890 45,722,668 47,355,643 Revenue from Other Sources 24,713,337 27,961,646 24,640,853 24,966,112 24,910,457

164,937,391 172,861,894 174,401,281 179,684,202 183,053,143

Expenses:General Operating Expenditures 118,200,799 118,143,011 118,877,925 121,292,049 124,060,786 Sanitary Sewer Operating Expenditures 4,321,296 4,280,431 4,339,756 4,395,536 4,450,832 Waterworks Operating Expenditures 9,127,514 9,249,929 9,273,169 9,706,147 9,413,006 Interest Payment on Municipal Debt 2,496,475 2,528,928 2,890,548 2,889,947 2,783,897 Amortization 23,527,325 23,424,366 23,346,056 22,920,790 22,920,790

Annual Surplus/Deficit 7,263,982 15,235,229 15,673,827 18,479,733 19,423,832

Add back:Amortization 23,527,325 23,424,366 23,346,056 22,920,790 22,920,790

Capital ExpendituresGeneral Capital Expenditures 17,792,628 29,691,378 13,689,484 9,992,100 15,575,900 Sanitary Sewer Capital Expenditures 3,909,475 8,647,000 6,078,500 5,502,102 2,653,246 Waterworks Capital Expenditures 12,170,908 9,143,356 9,590,300 11,122,200 8,258,500

Proceeds from Borrowing - (13,100,000) (1,650,000) (1,000,000) - Principal Payment on Municipal Debt 3,041,989 3,166,486 3,783,616 3,994,568 3,517,064 Transfers between Funds:

Special Funds - - - - - DCC Funds - - - - -

Transfers to/(from) Accumulated Surplus (6,123,693) 1,111,375 7,527,983 11,789,553 12,339,912

Financial Plan Balance - - - - -

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Bylaw No. 7234 Page 3

Schedule B

City of Nanaimo Statement of Revenue Objectives & Policies

1. Proportion of revenue by source

Property taxes

• The City of Nanaimo will attempt to keep the proportional share of revenue fromproperty taxes at a level similar to the average of comparable municipalities.

• Where new sources of revenue are made available to the City from seniorgovernments, wherever possible these revenues will be used to reduce dependencyon property taxation revenue.

Parcel taxes

• Parcel taxes will be used whenever Council determines that they are moreappropriate than property taxes.

Fees & Charges

• Wherever possible, fees & charges will be used to assign costs to those who benefitfrom the service provided. The proportion of the costs recovered by fees andcharges will vary with the nature of the service provided.

Proceeds of borrowing

• Borrowing will be considered when determining the funding sources of large capitalprojects that provide benefits to taxpayers over a long period of time (20 years ormore).

• Council will consider a policy to identify an appropriate level of debt for thecommunity.

Other sources of revenue

• The City will continue to seek other sources of revenue in order to reduce reliance onproperty taxes.

• The City will consider hydro electric power generation where practical andenvironmentally supportable.

2. Distribution of property taxes among the classes

• The City of Nanaimo will maintain the percentage of property taxes received fromresidential taxpayers at a level comparable to the average of similar municipalities.

• The City will attempt, over time, to reduce the commercial tax rate to the average ofall BC municipalities.

• Between 2009 and 2013, the light and major industrial tax rates were reduced to thesame level as the commercial tax rate.

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Bylaw No. 7234 Page 4

3. Permissive Tax Exemptions • The City of Nanaimo believes that Permissive Tax Exemptions are an appropriate

way to recognize the value of the services provided to the community by non-profit organizations.

• Permissive Tax Exemption requests will be reviewed by the Grants Advisory Committee based on policies and guidelines approved by Council. The Committee will make recommendations to Council.

• Permissive Tax Exemptions will be reviewed at least every three years to ensure that the organization and property still meets the criteria established by Council.

4. Revitalization Tax Exemptions

• The City of Nanaimo believes that Revitalization Tax Exemptions are an appropriate

tool to assist the City in realizing its strategic objectives. • The City can exempt municipal taxes for up to ten years for projects undertaken by

landowners, where the project meets defined objectives of a City strategy. • Recipients of exemptions must enter into a Revitalization Tax Exemption Agreement

with the City. • Every Revitalization Tax Exemption must be approved by Council.

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