AMENDED AGENDA

Financial Sustainability & Audit Meeting No. 12

October 26, 2021 at 9:00 a.m.

Fraser Room, City Hall

Limited seating, as per ORDER OF THE PROVINCIAL HEALTH OFFICER (Pursuant to Sections 30, 31, 32, 39, 54, 67 (2) and 69 Public Health Act, S.B.C. 2008) GATHERINGS AND EVENTS –

SEPTEMBER 10, 2021

(Public can submit comments on Agenda items to: cityhall@quesnel.ca) (Meeting minutes found at "Quesnel Civicweb")

Page A. CALL TO ORDER by - Councillor Scott Elliott [CHAIR]

B. APPROVAL OF AGENDA:

1) ADD: E.3) Budget

[Addenda]

C. ADOPTION OF REGULAR MINUTES:

3 - 4 1) Minutes of October 5, 2021

D. ACTIONS / OLD BUSINESS:

5 1) Action Summary

E. STAFF REPORT(S):

6 - 7 1) West Quesnel Land Stability

8 - 14 2) Council Finance Policies

3) Budget

[Addenda]

F. NEW BUSINESS:

Page 1 of 17

FINANCIAL SUSTAINABILITY & AUDIT AGENDA OCTOBER 26, 2021

Page 1) Finance Department Update:

Quarterly Updates:

• Accounts Payable Summary, Council Initiatives ...

2) Spending Issues (Overage)

15 3) CAO / CFO Expense Reports

16 - 17 4) Council Expense Reports

G. CORRESPONDENCE:

H. NEXT MEETING

I. MOVE TO SPECIAL CLOSED

J. RELEASE ITEM(S) FROM SPECIAL CLOSED TO SPECIAL OPEN

K. ADJOURN SPECIAL CLOSED AND RESUME SPECIAL OPEN

L. ADJOURNMENT:

Page 2 of 17

MEETING NO. 11 FRASER ROOM

QUESNEL CITY COUNCIL STANDING COMMITTEE

FINANCIAL SUSTAINABILITY & AUDIT COMMITTEE

A Municipal Council Standing Committee - FINANCIAL SUSTAINABILITY & AUDIT Meeting was held on the 5th day of October, 2021 commencing at 9:00 a.m. at Fraser Room, City Hall, 410 Kinchant Street.

Present:

Committee Member – Physical Attendance: Mayor Bob Simpson and Councillor Tony Goulet

Committee Member – Electronic Attendance: Councillor Scott Elliott [CHAIR],

Staff: City Manager Byron Johnson and Director of Corporate & Financial Services & Deputy City Manager Kari Bolton

Guest(s): None

Gallery: None

A. CALL TO ORDER BY - COUNCILLOR SCOTT ELLIOTT [CHAIR]

B. APPROVAL OF AGENDA:

21-11-44 By consensus

THAT the Financial Sustainability & Audit Committee approve the

October 5, 2021 Agenda as presented

CARRIED UNANIMOUSLY

C. ADOPTION OF REGULAR MINUTES:

C.1) Minutes of June 22, 2021

21-11-45 By consensus

THAT the Financial Sustainability & Audit Committee approve the

June 22, 2021 Minutes as presented

CARRIED UNANIMOUSLY

D. ACTIONS / OLD BUSINESS:

D.1) Action Tracking Summary

E. STAFF REPORT(S):

E.1) Master Fees Report – recommended increases from Staff

The Financial Sustainability and Audit Committee reviewed the recommended fees from staff for January 1st, 2022.

• Water fees are set to increase 5%, Sewer 2% and additional inflationary increases for the airport, cemetery and other schedules.

• A new business licence fee will be added for Commercial Landlords as changes to the Business Licence bylaw are coming from the Policy and Bylaw Committee. For the first year of this new category of business licence fee, the application fee will be waived.

Minutes of October 5, 2021 Page 3 of 17

Meeting No. 11 Fraser Room 5 October, 2021

The Financial Sustainability and Audit Committee discussed the need to review business licence fees next year in light of the costs of bylaw and fire inspection but recognized this year was still a tough year due to COVID.

E.2) Budget 2022

The Executive Committee discussed the start of the Budget 2022 process.

• This year the City will use the Let’s Connect platform to engage the community with the budget process.

F. NEW BUSINESS:

F.1) Capital Update

F.2) Covid Funds update

F.3) Council Funds Update

F.4) Third Quarter AP Report

F.5) CAO / CFO Expense Reports

F.6) Financial Sustainability and Audit Committee Annual Meeting Schedule 2021-

2022

21-11-46 MOVED Mayor Simpson, Seconded Councillor Goulet and

resolved: THAT the Financial Sustainability and Audit Committee recommend to Council the 2021-2022 Meeting Schedule for the Financial Sustainability and Audit Committee

CARRIED UNANIMOUSLY

G. CORRESPONDENCE:

H. NEXT MEETING: OCTOBER 26, 2021

I. MOVE TO SPECIAL CLOSED

J. RELEASE ITEM(S) FROM SPECIAL CLOSED TO SPECIAL OPEN

K. ADJOURN SPECIAL CLOSED AND RESUME SPECIAL OPEN

L. ADJOURNMENT:

With there being no further business to discuss, the Financial Sustainability & Audit Committee meeting ended at 10:19 a.m.

CERTIFIED CORRECT by Chair:

Councillor Scott Elliott

Page 2 of 2

Minutes of October 5, 2021 Page 4 of 17

Financial Sustainability & Audit Committee Action Tracking Summary – October 26 2021

Date # Responsible Action Status/ Complete

2021 Mar 30 114 Manager Reid The City of Quesnel will review the possibility of a Donate Local Campaign and

consider the possibility of working with Community the Quesnel Community Foundation on a new grant program for non-profits affected by COVID-19.

Mar 8 113 K Bolton [R Heartly]

Staff to bring the landfill liability and capital report to a future Council meeting.

FUTURE AGENDAS:

TRACKING for referred items:

Date Referred by / to

Responsible Action Status/Complete

01/26/21 by Council K.Bolton [M.Thomas]

Review landfill liability

Action Summ

aryPage 5 of 17

Page 1 of 2

City Staff Report Report Date: October 18, 202 Meeting Date: October 26, 2021

To: City Manager

From: Director of Capital Works & Infrastructure

Subject: West Quesnel Land Stability

Purpose To provide an update on the West Quesnel Land Stability (WQLS) dewatering program.

Summary Three years of data has been collected since the Phase two construction works were completed in 2017. 2020 indicated the most single year ground movement observed since 2005, which was prior to dewatering efforts.

Potential options to improve and lower the groundwater pressures which activate movement are available although some options come at a costly premium. They are:

A) Drain the ponds in the QWLS area; which is complicated and questionable whether it is environmentally viable. The ponds could be temporarily drained and lined to not allow water to infiltrate to the subsurface, however, it is important to note the six identified ponds are located on private property. The cost to do this is estimated at one to two million dollars per pond before including property acquisition/agreements, environmental requirements, and environmental compensation.

B) Add horizontal drains and drill more pumping wells. Pump wells come at a cost of approximately $70,000 per well. A number of wells drilled in the earlier phases of the WQLS project were non producers and abandoned. Decommissioning of the abandoned wells is an additional cost (over and above drilling costs) added after drilling should the well not be of use. Due to the changing geology of the WQLS area, drilling a high producing well at any predetermined location, to put it simply, can only be done with a best educated guess.

C) Storm drainage improvements help keep water from infiltrating to ground. There is not any additional drainage infrastructure planned although existing storm drain replacement projects are in the five year Capital Plan. Planned replacement of these leaky pipes will improve the system by not further adding to groundwater levels. In addition, public education for homeowners to direct surface water and gutter leads to the street so the drainage system can pick up the water helps with capture as does water conservation (ie: sprinkling restrictions).

D) Pro-actively provide consistent operation, maintenance, and replacement of the existing monitoring equipment and dewatering infrastructure. This is the current practice.

Weather patterns, unusual weather events, and drainage conditions contribute to groundwater levels and can create differences in movement year to year. The overall effectiveness of the existing dewatering depends on avoidance of high groundwater pressures which slow movement and volume of water removed or kept form going into the ground. Therefore, the cost benefit of constructing of dewatering infrastructure compared the reduction in ground movement is very difficult to accurately measure. Total cost of this project to date since the first year (2000) that began with monitoring through to project phases and now continued monitoring and maintenance of the dewatering system is over seventeen million dollars.

Administration Report No. ##/2019 Original signed by:

West Quesnel Land Stability Page 6 of 17

Page 2 of 2

Recommendation That Council discuss level of service supply for the West Quesnel Land Stability Program and provide direction to staff in preparation for budget.

Financial Implications In 2020, Council passed a resolution that beginning with 2020, that any unused budgeted operation funds for the West Quesnel Land Stability Project be put into the West Quesnel Land Stability Reserve for future capital and operating requirements. The budget proposed for the coming 2022 year out of the general operating budget is $225,220 to operate the WQLS system. Included in this minimum budget to maintain status quo is $70,000 for equipment replacement/repairs. As this infrastructure ages a better estimate of life expectancy will be available.

If consideration was given to drilling six to eight dewatering wells the current cost would be approximately $500,000. Should a well not produce and require decommissioning, this would add roughly add a cost of $20,000 per well to meet regulations. In 2012 dollars, the cost to construct horizontal drain fans was roughly one million dollars per month during that ten week construction season for equipment, materials, and labour. Some of the drain fans produced no water and were abandoned. If either of these options were to be considered, there is no guarantee as to what production will be delivered and what effect, if any, it will have on future ground movement.

Background Phase two of the WQLS Project was completed in 2016 and 2017. The major components of the overall project included 23 pumping wells, 9 active horizontal drain fans, in place slope inclinometers, Peizometers (groundwater pressure monitors), flow meters, data stations, and storm drain infrastructure. Three full years of land movement data has been gathered since the completion of Phase two. 47 GPS hubs are surveyed twice annually to provide information on horizontal movement. Historical movements of up to 87 mm per year has been previously observed. Monitoring of a representative GPS hub for horizontal movement between 2013 and 2019 showed an average of 13mm movement per year. In 2020 the same hub showed 84mm of movement.

In 2020, an estimated 123 million litres of water was removed by the pumping wells which is the most since inception of the program. An additional 74 million litres was removed by the horizontal drains. Unusual weather events indicate that this can be attributed to the additional volume of water removed from the ground.

Options

A) Drain ponds at very high expense and level of effort B) Add more drains and pumping wells with unknown outcome C) Complete storm drainage improvements as per Capital Plan D) Maintain existing WQLS infrastructure in good working condition E) Wait a predetermined time to collect more data to see if 2020 was an unusual year. F) Any combination of the above

West Quesnel Land Stability Page 7 of 17

Page 1 of 1

Council Report No. ##/YEAR

Council Report Report Date: Oct 18, 2021 Meeting Date: Oct 26, 2021

To: Financial Sustainability and Audit Committee

From: Director of Corporate and Financial Services

Subject: Council Finance Polices

Purpose

The purpose of this report is to review and reaffirm several Council Finance Policies that have not been reviewed for around five years.

Summary

As per the City’s Policy Development and Review Policy – IWC -15, the City will strive to ensure all polices are reviewed and updated on a continual basis, every five (5) years.

The following Council Finance policies are up for review:

• CF-6 Budget Monitoring – Last reviewed June 15, 2015 • CF-7 Neighbourhood Funding Policy – Last reviewed May 24, 2016 • CF-10 Living Wage Policy – Last reviewed September 6, 2016

There have been no requests under the Neighbourhood Funding Policy since it was last updated in 2016.

The Living Wage for Families BC group has indicated started next year there will be a small fee $200 per year to get recertified each year. The current living wage for our area is $16.51 per hour ($15.20 per hour is the minimum wage.

Recommendation

THAT the Financial Sustainability and Audit review the attached polices and suggest any changes and send to Council for approval.

Attachments 1. CF-6 Budget Monitoring – Last reviewed June 15, 2015 2. CF-7 Neighbourhood Funding Policy – Last reviewed May 24, 2016 3. CF-10 Living Wage Policy – Last reviewed September 6, 2016

Council Finance Policies Page 8 of 17

Page 1 of 3

Budget Monitoring Policy-CF-6

EFFECTIVE: June 15, 2016 AUTHORIZED BY: Council RESOLUTION: 15-18-399 REPLACES: New Policy POLICY It is the policy of the City of Quesnel to monitor actual operating and capital activity to ensure adherence to Council approved spending and service levels. PURPOSE OF POLICY To set guidelines for monitoring operating and capital activity to ensure adherence to Council approved operating budgets, capital budgets and service levels. ROLES AND RESPONSIBILITIES The monitoring of the City’s budget is an ongoing process. The following roles have budget responsibilities.

ROLE RESPONSIBILITIES

Council Ultimate responsibility for City spending. Sets annual budget and service levels for staff to operate under. Any change in budget, service level or use of reserves must be approved by Council.

Financial Sustainability and Audit Committee (FSAC)

• Provide leadership for the budget preparation process within the framework established by Council’s Strategic Plan and Budget Principles Policy.

• Work with senior management to troubleshoot and make recommendations to Council on ongoing significant financial issues.

Chief Administrative Officer (CAO) To exercise financial control over all corporate operations in conjunction with the Chief Financial Officer to ensure compliance with the annual estimates of revenue and expenditure approved by Council

Director of Corporate and Financial Services (CFO)

To prepare and present the operating and

Council Finance Policies Page 9 of 17

Page 2 of 3

capital budget to FSAC and Council To make financial recommendations to

FSAC and Council

Monitors financial information for City Reports on a quarterly basis to Council on

the operating and capital budget Directors Overall accountability for the

departmental budget. General oversight and monitoring of expenses to ensure adherence to the approved budget.

Identification of risk and recommendation of mitigation measures to CAO and CFO

RISK MANAGEMENT Having responsibly to the overall city budget means identifying and mitigating risks in order to minimize the impact to taxpayers. Over spending on capital projects can have an impact on capital reserves or operating budgets. Early identification of projects at risk of going over budget is important to mitigate these risks. VARIANCE APPROVAL AND REPORTING Operating Once the annual budget is produced, actual expenditures are monitored and compared against budget. While some differences are expected, variances should not be considerably above or below budget. Departments are provided with regular financial reports comparing their year to date spending versus budget in order to monitor the budget. Any anticipated significant overages should be reported immediately to the Director of Corporate and Financial Services. Any overages over $25,000 will be reported to the Financial Sustainability and Audit Committee as soon as possible and to Council on the quarterly reports. Capital Once a capital project is approved it is expected that it will be completed in a timely manner, within the approved budget and scope, and will deliver the expected outcome to the taxpayers. Council may choose to alter the scope of a project at a later date but must approve an updated budget and funding sources either the same time as the updated scope or shortly after, once staff has had time to estimate the costs of the additional scope requested by Council. Project managers are provided with regular financial reports comparing the cost of the project to date versus budget to enable effective monitoring of total costs. Any change in scope or spending must be approved by the following. All expected overages will be reported quarterly to Council.

Council Finance Policies Page 10 of 17

Page 3 of 3

Unbudgeted Amount Approval Required Less than 10% or under $10,000 Project Manager Less than 20% or under $25,000 CAO More than 20% Council

Approvals by the CAO must be in writing and copied to the Director of Corporate and Financial Services for record keeping purposes.

Council Finance Policies Page 11 of 17

Page 1 of 1

Neighbourhood Funding Policy – CF 7

EFFECTIVE: May 24, 2016 AUTHORIZED BY: Council RESOLUTION: 16-19-310 REPLACES: 2004 POLICY Neighbourhood Associations are recognized by the City Council as eligible to request funding annually as part of the Budget Process to help sustain their operations. Funding is at the discretion of Council and will only be considered if all funds on hand, previously funded by the City of Quesnel, have been utilized before applying for new funds. PURPOSE OF FUNDING SUPPORT Funding is made available to assist Neighbourhood Associations to help pay for expenses relating to the operations of their organization. Types of expenses that are eligible include: • Rental of facilities if required to conduct meetings and business of the association • Office supplies • Neigbourhood social functions to promote the neighbourhood • Advertising and for other neighbourhood promotion costs PROCEDURE 1. Neighbourhood Associations can submit a request for funding as part of the budget process to the

Director of Corporate and Financial Services by November 1st each year for funds to be available the following year.

2. Neighbourhood Associations must keep record of all expenditures paid for through City supported

funding. Receipts and a summary statement are to be provided to the Director of Corporate and Financial Services verifying expenditures. This should be submitted before requesting new funds.

3. New funding will only be made available to associations who have properly accounted for their

previous funding support that has been contributed from the City of Quesnel.

Council Finance Policies Page 12 of 17

Page 1 of 2

Living Wage Policy-CF-10

EFFECTIVE: September 6, 2016 AUTHORIZED BY: Council RESOLUTION: 16-26-483 REPLACES: New Policy PURPOSE The purpose of this policy is to ensure that all City Staff and Service Providers to the City who work on City premises for a specified period of time earn, at a minimum, a living wage. The City of Quesnel believes that it is important to demonstrate social responsibility through actions that have a positive impact on our community, our staff and the people we serve. The City of Quesnel believes that families should earn an income sufficient for them to pay for the basic necessities of life so that they can live with dignity and participate as active members of our communities. DEFINITION Living Wage The living wage is the hourly rate of pay that enables wage earners living in a household to:

Feed, clothe and provide shelter for their family

Promote healthy child development Participate in activities that are an ordinary element of life in the community

Avoid the chronic stress of living in poverty This hourly rate is calculated every year by the Living Wage for Families Campaign, based on the living expenses of a family of four with two children aged 4 and 7, with both parents working full time (35 hours/week). Direct Staff Staff earning only a salary or wage will earn at minimum a living wage. The living wage is recalculated annually at the end of April and takes effect May 1st of each year. Any increases in the living wage will be passed onto staff within six months of this date. Contracted Staff Where services are contracted, e.g., janitorial, road paving we choose vendors/service providers that also pay a living wage to their staff similar to this policy. This clause covers external contracts that provide services for our company on a regular, ongoing basis, that is, for at least 120 hours of labour per year. Living wage clauses are included in all agreements and renegotiated agreements with contractors we hire.

Council Finance Policies Page 13 of 17

Page 2 of 2

Benefits in Consideration In instances where non-mandatory benefits are provided to staff, the basic hourly wage due to staff may be adjusted to reflect the positive impact these benefits have on the employee’s ability to meet basic needs and have some discretionary income. APPLICATION The policy applies to all employees employed by the City of Quesnel, as well as all employers employed by a contractor or subcontractor who perform services directly or indirectly for the City of Quesnel on a regular ongoing basis (at least 120 hours per year). IMPLEMENTATION, COMPLIANCE AND ENFORCEMENT The City will implement this policy effective November 1st, 2016. Contracts in effect at the time of implementation will be grandfathered until such time as the contract expires or is renegotiated, whichever comes first. This Policy will encompass all City employees, Service Provider and Sub-contractor employees with the following exclusions:

Students working in positions such as skate patrol and the summer fun program Employees hired under the diversification program Volunteers

Employees of organizations (for-profit or not-for-profit) that lease space / property from the City.

The City will ensure that all employees are paid no less than the living wage and will encourage language into the Collective Agreements to reflect this. The City will incorporate language into all contractor agreements, bid documents, etc indicating that all contractors whose services fall into the parameters of this policy are required to pay a living wage for the term of their contract with the City of Quesnel. A declaration will be requested as part of any contract agreement stating the contractor understands the requirement of paying a living wage. The City will enforce the Policy by performing audits of its Service Providers when notification of non-compliance is received by the City. These audits may take the form of a review of paystubs issued by the vendor under review or any other means pertinent to arriving at a determination. Non-compliance may result in the cancelation of the Contract at the discretion of the City.

Council Finance Policies Page 14 of 17

Visa Reconciliation Form

Cardholder name: Byron JohnsonPeriod March 30 - April 27, 2021Visa STMT Total 64.00

Net GST Total DESCRIPTION

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Signatures Date

_______________________ _____________________________

Cardholder: _______________________ _____________________________

ACCOUNT NUMBER

Approving Manager:

CAO / CFO Expense Reports Page 15 of 17

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