2017 03 07 Fire DP Follow Up Report LG
Report to Closed BIN DATE:
March 2, 2017
TO:
Budget and Infrastructure Committee (BIN)
FROM:
Department Heads
SUBJECT:
FIRE DECISION PACKAGE FOLLOW-UP
EXECUTIVE SUMMARY: This report provides a recommendation to support the request for additional resources in the Fire & Emergency Services Department while providing a series of adjustments to the budget in order to stay within the 4% limit indicated by BIN at the January 11, 2017 meeting. This has been a very challenging process resulting in a thorough exploration of as many options as possible in the time permitted to try to find a workable solution. To stay within the 4% limit, budget reductions are recommended from the following areas: Repurposing funding from vacant positions ($220,000); Deferral of some of the endorsed enhancements until 2018 ($112,000); Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500) RECOMMENDATION: That Option 2 (A combination of Staff Increases and Service Cuts - Adding five firefighters in July, 2017 and four in July, 2018 combined with reducing 200 medical calls and more substantial changes to the response plan) from the Fire report included in the February 7th 2017, Closed BIN agenda package be approved; and That the following adjustments be made to the draft 2017/2018 financial plan:
Repurposing funding from the following positions : Assistant Manager, Bylaw Services; Manager, Parks Planning and Design; Customer Service Manager, Parks & Recreation Support ($284,000); Deferral of the Financial Analyst Enhancement (6-11) and Engineering Studies Enhancement (6-12) until 2018 ($112,000), Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500)
March 2, 2017 2017-2018 Business Plan Follow-up Information
BACKGROUND AND COMMENTS: Current Status 2017-2018 departmental business plans and operating budgets were presented to committee on December 5 and 6, 2016 followed by decision package deliberations on December 13th. At the time a base average increase for 2017 of $107.04 or 3.97% was presented. After adjusting for endorsed enhancements, the average increase is $115.99 or 4.30%. A summary of the 2017/2018 operating budget was provided to BIN at the January 11th, 2017 meeting as a status update. During that meeting, committee members indicated that the overall increase to the average home for 2017 should not exceed 4%. A copy of the 2017/2018 operating budget as of January 11th, 2017 has been provided below for reference.
Base General Taxation 6-11 Financial Analyst 6-12 Engineering Studies 6-13 Supervisory Skills Base Water Levy 6-12 Engineering Studies 6-21 Ambassador Program Base Sewer Levy 6-12 Engineering Studies Base Solid Waste Levy 6-21 Ambassador Program Parcel Tax Impact Total Impact
Amount 2,104,405 87,000 25,000 50,000 137,440 12,500 10,000 288,500 12,500 68,095 40,000 512,500 3,362,940
2017 $ / AH 63.94 2.64 0.76 1.52 3.00 0.46 0.30 10.65 0.46 4.45 1.22 25.00 115.99
% / AH 2.37% 0.10% 0.03% 0.06% 0.11% 0.02% 0.01% 0.40% 0.02% 0.17% 0.05% 4.30%
Amount 2,428,300 (6,000) 167,440 312,900 1,905 2,904,545
2018 $ / AH (0.18) 4.72 9.74 0.12 88.18
% / AH -0.01% 0.17% 0.35% 0.00% 3.17%
Fire Service Option Included in the decision package, was a request by the fire department for nine additional firefighters and a medic unit vehicle. Committee asked for additional information prior to making a decision on this request including options to: reduce service levels, explore less expensive ways to deliver the service and spread the financial impact of adding more firefighters over a number of years, as well as a recommendation by Department Heads on how this request should be funded. At the February 7th, 2017 closed BIN meeting, Committee reviewed a follow-up report for the fire request providing the requested information. At that time, no recommendation was provided by Department Heads as the analysis on funding impacts was still being examined. As requested on February 7, additional information has been provided on the service levels and clarity regarding mandatory/discretionary training. Options to reduce inspection frequencies were provided in the February report. Since service levels, training and inspection load are the key drivers of the budget request, the focus has been on providing that information in the time available. The implementation of the revenue opportunities if supported, is not anticipated to have an impact on 2017 revenues, therefore the strategy to implement the revenue opportunities will be provided in the coming months for increased revenue in 2018. Of the options presented in the February 7th report, the one considered most feasible, and therefore recommended, by Department Heads is Option 2. This option balances budgetary pressures, the City’s risk exposure, and the public’s service expectation. An extract of this option is provided below for reference. For a
March 2, 2017 2017-2018 Business Plan Follow-up Information
complete listing of all the options, please refer back to the February 7, 2017 BIN report, a copy of which has been included in this agenda package for reference. Option 2: A combination of Staff Increases and Service Cuts The additional staffing would cost approximately $280k in 2017, $470 in 2018 and $215K in 2019. From July, 2017 to July, 2018 the second apparatus at #2 Hall would be in-service when staffing permits (i.e. when there were a minimum of 13 or 14 members on shift). The more substantial changes to the response plan would involve sending only one apparatus to a fire alarm systems activations panel call (we currently send two) and only sending one apparatus to certain types of MVAs (those not on main roads and initially described as not high impact collisions.) These two additional changes to the response plan would also eliminate about 300 runs each year. The risk of sending one apparatus to an alarms call is that if there is a significant issue triggering the alarm in these complex buildings then the ability to deal with the fire or hazardous material is delayed until the second and third apparatus arrive on scene. This recommendation has the following budgetary impact: 2017 280,000
$ / AH $8.51
% / AH 0.32%
2018 $470,000
$ / AH $14.28
% / AH 0.51%
Revised Status Should Council endorse the inclusion of option 2 for the Fire Department, as recommended by Department Heads, this would result in a further increase of 0.32% in 2017 for a revised overall increase of 4.62%. Getting Down to 4% Target Balancing needed enhancements and staying under 4% while dealing with a base budget of 3.97% has been a very challenging process. Committee asked staff to bring forward information on a number of areas to be considered as a means to reduce the overall impact to the average home owner. This included information on: reserve contributions and balances (part of the February 28th agenda package), staff vacancies and nonemergency overtime. In addition to this information, the entire budget was reviewed by the Department Heads, as well as a review of the previously recommended ongoing enhancements that were supported by Committee earlier in the budget process. In order to get the increase below the maximum of 4%, Department Heads recommend the following adjustments/reductions:
Repurposing funding from vacant positions ($284,000); Deferral of some of the endorsed enhancements until 2018 ($112,000), Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500)
Repurposing Funding From Vacant Positions The following table provides a list of positions that are currently vacant or filled on a temporary basis that Department Heads have recommended as reductions in order to get down to the 4% target.
March 2, 2017 2017-2018 Business Plan Follow-up Information
Recommended For Reduction: Position Assistant Mgr, Bylaw Services
$/AH
%/AH
(60,200) (63,200)
(1.83) (1.92)
-0.07% -0.07%
Customer Service Manager
(30,000)
(0.91)
-0.03%
Parks & Recreation Support
(66,600)
(2.02)
-0.08%
(220,000)
(6.68)
-0.25%
Mgr, Parks Planning and Design
Total
Amount
Rationale The Bylaw division is operating with one management position since the retirement of the previous manager. There is the potential to convert this exempt position into a part time CUPE position for Bylaw Enforcement Officer, resulting in the aforementioned savings. This partial funding (the remainder was Parks DCCs) for an exempt position, was held in the department until completion of the capital plan, in the event that additional resources were required to deliver the new plan. While additional resources may be required in the Capital Projects division at a later date, this funding could be repurposed in the meantime. This funding relates to a reduced scope of work and pay due to a medical accommodation for an exempt position. The revised position is now considered to be a long term solution with many of the former duties reallocated to other managers. This vacancy is the result of a recent retirement. There may be a need to revisit the need for this CUPE position when phase one of the new rec complex opens. This will be reviewed in the context of the overall staffing requirements of phase one of the rec complex at that time. Meanwhile, a decentralized facility booking model will be explored and increases in part time support through the vacancy period will be kept to a minimum.
Deferral of Endorsed Enhancements Until 2018 At the Dec 13th BIN meeting, Committee voted in favor of the following ongoing enhancements:
6-11 Financial Analyst 6-12 Engineering Studies 6-13 Supervisory Skills 6-21 Ambassador Program Total Impact
Amount 87,000 50,000 50,000 50,000 237,000
2017 $ / AH 2.64 1.68 1.52 1.52 7.36
% / AH 0.10% 0.03% 0.06% 0.01% 0.27%
Amount (6,000) (6,000)
2018 $ / AH (0.18) (0.18)
% / AH -0.01% -0.01%
Of these enhancements, Department Heads recommend deferring the Financial Analyst and the tax funded portion of the engineering studies ($25,000) until 2018. While these two enhancements are needed in 2017, it was determined that deferral of these two items would be the least detrimental to operations. This recommendation has the following budgetary impact: 2017 (112,000)
$ / AH (3.40)
% / AH -0.13%
2018 112,000
$ / AH 3.40
% / AH 0.12%
March 2, 2017 2017-2018 Business Plan Follow-up Information
Increasing the Portion of the RCMP Operating Budget Funded From Reserve Of the annual operating budget for the RCMP, $400,000 is funded from the RCMP reserve instead of taxes. The rationale is based on the fact that over the last 10 years, the RCMP has had an operating surplus in each year. Rather than taxing for funds that don’t appear to be needed, Council reduced portion of the budget funded from taxes but also set aside some money into a reserve to make up the difference should costs be higher than anticipated. Based on continued surplus in RCMP despite reducing the tax funded portion of operations, Department Heads recommend a further $100,000 be funded from the RCMP reserve instead of taxes. This does expose the City to a small amount of risk at some point, should the RCMP be able to fill a considerable amount of vacant positions. However, based on the current reserve balance of $1.5 million, a tax increase would not be required for approximately three years after the RCMP reached capacity. While a larger amount could be funded from reserves to further offset the impact to taxes, it is not recommended at this time as the RCMP foresee reducing the vacancy rate. The following table shows the RCMP surplus since 2007.
Budget 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
$ $ $ $ $ $ $ $ $ $
RCMP Surplus Actual
14,187,104 13,329,490 13,067,500 13,165,563 12,019,605 11,592,100 10,923,000 10,368,800 9,795,800 9,036,500
$ $ $ $ $ $ $ $ $ $
5 year Average 10 year Average
13,445,943 12,549,382 12,124,072 11,760,150 11,126,100 10,553,932 10,161,900 9,460,686 9,103,241 8,751,719
Surplus $ $ $ $ $ $ $ $ $ $
741,161 780,108 943,428 1,405,413 893,505 1,038,168 761,100 908,114 692,559 284,781
$ $
952,723 844,834
This recommendation would have the following budgetary impact: 2017 $(100,000)
$ / AH $(3.04)
% / AH -0.11%
2018
$ / AH -
% / AH -
Adjusting for Corporate Vacancies While it is difficult to calculate a vacancy rate given that in many cases vacant positions are either backfilled or supported through the use of contracted services to get the work done, it is unlikely that the cost for backfilling and contracting out completely offset the savings as a result of vacancies. For this reason, Department Heads recommend a blanket adjustment for vacancies of $100,000. This reduction is an addition to repurposing of the funding for existing vacant positions as noted above. As we continue to build our financial system, we will be able to better refine and adjust this figure in the future.
-
March 2, 2017 2017-2018 Business Plan Follow-up Information
This recommendation has the following budgetary impact: 2017 $(100,000)
$ / AH $(3.04)
% / AH -0.11%
2018
$ / AH -
% / AH -
-
Reducing the Net Recreation Budget The Recreation Programs CIA outlined the difference between the net operating budget and the net operating actuals showing a positive variance. There is some interest from Council to reduce the taxation allocated to recreation to narrow the gap. Based on historical results, a $50,000 reduction to the net operating budget could be made. This recommendation has the following budgetary impact: 2017 $(50,000)
$ / AH $(0.32)
% / AH -0.01%
2018
$ / AH -
% / AH -
-
Adjusting For Anticipated Savings on PST for Hydro Costs The provincial government’s 2017 budget announcement includes a provision to reduce the provincial tax on electricity to 3.5% from 7%, effective Oct 1, 2017. Should this measure pass, this would result in an annual savings of $42,000 ($10,500 for Oct - Dec 2017) to the City. Department Heads recommend this be included in the 2017/2018 budget as an adjustment. This recommendation has the following budgetary impact: 2017 $(10,500)
$ / AH $(0.32)
% / AH -0.01%
2018 $(31,500)
$ / AH ($0.96)
% / AH -0.03%
Other Budgetary Options Not Recommended In addition to the recommendations presented above, Department Heads considered a series of other options which are listed below. Vacancies Not Recommended For Reduction: Position Civil Engineer
HR Advisor
Amount 143,300
$/AH 4.35
%/AH 0.16%
108,300
3.29
0.12%
Rationale This exempt position will be critical to advancing the Infrastructure Priority in developing asset management plans and a long term capital plan. This exempt position represents 20% of staff complement in HR; a full-time position was eliminated in 2013 and legal budget was reduced in 2014 increasing workload on current staffing; key projects are not being implemented (e.g. performance management) and HR functions are being downloaded onto managers while this position is vacant; labour market continues to
March 2, 2017 2017-2018 Business Plan Follow-up Information
Position
Amount
Sign Tech
$/AH
%/AH
92,700
2.82
0.10%
Storekeeper-Buyer
100,400
3.05
0.11%
Bylaw Enforcement Officer Corporate Services Support
84,200
2.56
0.09%
27,400
0.83
0.03%
101,900
3.10
0.11%
94,700
2.88
0.11%
752,900
22.88
0.85%
Foreman III Public Works
Electrician
Total
Rationale tighten leading to greater importance on specific attraction and retention strategies that requires staff resources to implement This CUPE position is filled temporarily pending the sign tech arbitration. Should this full-time position be eliminated, we would need to contract out this work. An analysis would need to be done to determine whether this would result in cost savings or additional costs. This CUPE position is filled temporarily pending the sign tech arbitration. Without this position the Purchasing CIA implementation will continue to be delayed, including the standardization and guidance on purchasing processes which is expected to decrease costs, increase efficiencies and reduce risk. This CUPE position is filled temporarily and is required to maintain the current service levels. This part time CUPE position is filled temporarily pending the arrival of the new Corporate Officer and is required to maintain the current service levels. This CUPE position is the supervisor for the Streets area of Public Works, and is responsible for coordinating the work of the division, including planning and scheduling crews, materials, supplies, equipment etc. This position has recently been expanded as well as a result of the shared services CIA, and includes the newly created electrical division. Elimination of this position would result in these duties being re-distributed amongst the other Foreman III positions. This CUPE position was held vacant until the City was able to procure a bucket truck. Should we not fill this position, the work would still need to be completed and we would need to contract out much of the work we are planning to bring in house.
Non-Emergency Overtime Department heads do not recommend any elimination of non-emergency OT due to the detrimental impact it would have on operations.
Department Corporate Support
Corporate Support Corporate Support Corporate Support
Section Communications, Legislative and Admin
Budgeted Amount
4,700
Actual Amount
6,714
Corporate Office
900
2,867
Bylaw Services Information Services
600
5,696
10,100
10,717
Nature of OT
Impact of Eliminating OT
Support for community events outside of business hours. After hours meeting support from the Assistant Corporate Officer. Call out time for enforcement issues. System maintenance outside of business
No communication support
No Corporate Office support when the Corporate Officer is not present. No after hours bylaw enforcement. System maintenance undertaken during business hours. Impact to
March 2, 2017 2017-2018 Business Plan Follow-up Information
Department
Section
Budgeted Amount
Actual Amount
Nature of OT
Impact of Eliminating OT
hours.
customer service and productivity. Agenda cut-off deadline would need to decrease. More lead time required for budget preparation. Potential for payroll adjustments to correct pay. Delay in processing tax and utility payments. Recruitment would need to be conducted during business hours, time sensitive project deadlines may need to be extended.
Committee agenda prep and minute taking. Budget preparation, payroll processing, tax and utility bill processing. Finance
Human Resources
Development Services
Finance
Human Resources
Planning
14,200
1,900
5,600
22,547
310
To assist with recruitment that takes place outside of regular business hours, and to complete time sensitive projects. Committee support
6,985 Minutes at HCC meetings, allocation meetings, active net support
Recreation
Recreation Administration
2,600
1,710 Support for events outside business hours. Call outs for after-hours alarms. Vacancy coverage.
Recreation
Facility Services
18,300
41,660 Vacancy coverage, special events.
Recreation
Recreation
Cultural Development & Community Services
Recreation
5,000
16,100
12,522
35,092
Stat holiday facility operation, special event support, vacancy/vacation
CUPE planning staff attend Smart Growth Committee meetings as required where the member is the file manager of a development application or planning process, promoting enhanced customer service. Loss of overtime would also entail management keeping minutes. Reduced support for evening committee meetings, allocation committees, and after hours active net user trouble shooting and resolving customer service issues. Less technical and general support for event set up and take down. Evening recreation staff supervisors would be required to respond to alarm calls and/or cross training with other staff teams. Less technical maintenance support for vacation and vacancy coverage. Less staff support for special delivery, take down and set up. Less vacancy coverage – supervisory support for part time Arts and Culture program staff No full time staff support during facility operation on stat holidays; less support for special events; less vacancy/vacation
March 2, 2017 2017-2018 Business Plan Follow-up Information
Department
Budgeted Amount
Section Total
Actual Amount
$80,000
Nature of OT
Impact of Eliminating OT
coverage.
coverage.
$146,820
This option has the following budgetary impact: 2017 $(80,000)
$ / AH $(0.32)
% / AH -0.01%
2018
$ / AH -
% / AH -
-
Adjusting Annual Contributions to LTR Department Heads considered a reduction to the annual contribution to the LTR. However, as the balance saved to date in the LTR has been depleted in order to fund construction of the rec complex, no further changes are recommended as this would even further delay the time frame for LTR contributions to reach a sustainable level sufficient to fund an ongoing capital rehabilitation and replacement program.
Development Services Revenue Adjustment The approach taken by the Department since 2009 has been to use a conservative forecast to avoid impacting tax rates if an optimistic revenue projection is not achieved. This approach recognizes that the Department has limited flexibility to reduce costs (other than by reducing staff) and limited ability to influence market-driven revenues. While in the past few years we have seen higher revenues than budgeted, it is difficult to forecast if this trend will continue. The most substantial development activity has occurred in the Dominion Triangle after major roads and services were installed to facilitate growth, but this area will soon be fully developed (residential is ~90% completed; industrial ~75%). Growth through infill and replacement of existing buildings is expected to continue in 2017 and we have at least one major institutional project in the planning stages (Minnekhada School). However, offsetting higher revenue will be higher costs associated with the permit review and inspection process for the Community Recreation Complex as we will not realize any revenue from that project. Revenues generated from applications in the Planning, Building, and Development Engineering Divisions which exceed expenses are treated as surplus and contribute to the City’s overall budget demands.
Conclusion This report recommends supporting the request for additional resources in the Fire & Emergency Services Department while providing a series of adjustments to the budget in order to stay within the 4% limit indicated by BIN at the January 11, 2017 meeting. This has been a very challenging process resulting in thorough exploration of as many options as possible in the time permitted to try to find a workable solution. To stay within the 4% limit, budget reductions are recommended from the following areas: Repurposing funding from vacant positions ($220,000); Deferral of some of the endorsed enhancements until 2018 ($112,000); Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500)
March 2, 2017 2017-2018 Business Plan Follow-up Information
Based on the recommendations presented above, the revised impact to the average home for 2017/2018 would be as follows:
Base General Taxation 6-11 Financial Analyst 6-12 Engineering Studies 6-13 Supervisory Skills Fire Department Staffing Repurpose vacant positions RCMP Budget Adjustment Corporate Vacancy Rate Recreation Budget Adjustment BC Hydro Budget Adjustment Base Water Levy 6-12 Engineering Studies 6-21 Ambassador Program Base Sewer Levy 6-12 Engineering Studies Base Solid Waste Levy 6-21 Ambassador Program Parcel Tax Impact Total Impact
Amount 2,104,405 50,000 280,000 (220,000) (100,000) (100,000) (50,000)
2017 $ / AH 63.94 1.52 8.51 (6.68) (3.04) (3.04) (1.52)
% / AH 2.37% 0.06% 0.32% -0.20% -0.11% -0.11% -0.06%
Amount 2,428,300 87,000 25,000 (6,000) 470,000 -
2018 $ / AH 73.79 2.64 0.76 (0.18) 14.28 -
% / AH 2.63% 0.09% 0.03% -0.01% 0.51% -
(10,500)
(0.32)
-0.01%
(31,500)
(0.96)
-0.03%
137,440 12,500 10,000 288,500 12,500 68,095 40,000 512,500 3,035,440
3.00 0.46 0.30 10.65 0.46 4.45 1.22 25.00 106.04
0.11% 0.02% 0.01% 0.40% 0.02% 0.17% 0.05%
167,440 312,900 1,905 3,455,045
4.72 9.74 0.12 104.90
0.17% 0.35% 0.00% 3.75%
Respectfully Submitted on Behalf of Department Heads by,
_______________________________ John Leeburn CAO Attachment: February 7, 2017 Fire DP Follow Up Report
3.93%
March 2, 2017
TO:
Budget and Infrastructure Committee (BIN)
FROM:
Department Heads
SUBJECT:
FIRE DECISION PACKAGE FOLLOW-UP
EXECUTIVE SUMMARY: This report provides a recommendation to support the request for additional resources in the Fire & Emergency Services Department while providing a series of adjustments to the budget in order to stay within the 4% limit indicated by BIN at the January 11, 2017 meeting. This has been a very challenging process resulting in a thorough exploration of as many options as possible in the time permitted to try to find a workable solution. To stay within the 4% limit, budget reductions are recommended from the following areas: Repurposing funding from vacant positions ($220,000); Deferral of some of the endorsed enhancements until 2018 ($112,000); Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500) RECOMMENDATION: That Option 2 (A combination of Staff Increases and Service Cuts - Adding five firefighters in July, 2017 and four in July, 2018 combined with reducing 200 medical calls and more substantial changes to the response plan) from the Fire report included in the February 7th 2017, Closed BIN agenda package be approved; and That the following adjustments be made to the draft 2017/2018 financial plan:
Repurposing funding from the following positions : Assistant Manager, Bylaw Services; Manager, Parks Planning and Design; Customer Service Manager, Parks & Recreation Support ($284,000); Deferral of the Financial Analyst Enhancement (6-11) and Engineering Studies Enhancement (6-12) until 2018 ($112,000), Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500)
March 2, 2017 2017-2018 Business Plan Follow-up Information
BACKGROUND AND COMMENTS: Current Status 2017-2018 departmental business plans and operating budgets were presented to committee on December 5 and 6, 2016 followed by decision package deliberations on December 13th. At the time a base average increase for 2017 of $107.04 or 3.97% was presented. After adjusting for endorsed enhancements, the average increase is $115.99 or 4.30%. A summary of the 2017/2018 operating budget was provided to BIN at the January 11th, 2017 meeting as a status update. During that meeting, committee members indicated that the overall increase to the average home for 2017 should not exceed 4%. A copy of the 2017/2018 operating budget as of January 11th, 2017 has been provided below for reference.
Base General Taxation 6-11 Financial Analyst 6-12 Engineering Studies 6-13 Supervisory Skills Base Water Levy 6-12 Engineering Studies 6-21 Ambassador Program Base Sewer Levy 6-12 Engineering Studies Base Solid Waste Levy 6-21 Ambassador Program Parcel Tax Impact Total Impact
Amount 2,104,405 87,000 25,000 50,000 137,440 12,500 10,000 288,500 12,500 68,095 40,000 512,500 3,362,940
2017 $ / AH 63.94 2.64 0.76 1.52 3.00 0.46 0.30 10.65 0.46 4.45 1.22 25.00 115.99
% / AH 2.37% 0.10% 0.03% 0.06% 0.11% 0.02% 0.01% 0.40% 0.02% 0.17% 0.05% 4.30%
Amount 2,428,300 (6,000) 167,440 312,900 1,905 2,904,545
2018 $ / AH (0.18) 4.72 9.74 0.12 88.18
% / AH -0.01% 0.17% 0.35% 0.00% 3.17%
Fire Service Option Included in the decision package, was a request by the fire department for nine additional firefighters and a medic unit vehicle. Committee asked for additional information prior to making a decision on this request including options to: reduce service levels, explore less expensive ways to deliver the service and spread the financial impact of adding more firefighters over a number of years, as well as a recommendation by Department Heads on how this request should be funded. At the February 7th, 2017 closed BIN meeting, Committee reviewed a follow-up report for the fire request providing the requested information. At that time, no recommendation was provided by Department Heads as the analysis on funding impacts was still being examined. As requested on February 7, additional information has been provided on the service levels and clarity regarding mandatory/discretionary training. Options to reduce inspection frequencies were provided in the February report. Since service levels, training and inspection load are the key drivers of the budget request, the focus has been on providing that information in the time available. The implementation of the revenue opportunities if supported, is not anticipated to have an impact on 2017 revenues, therefore the strategy to implement the revenue opportunities will be provided in the coming months for increased revenue in 2018. Of the options presented in the February 7th report, the one considered most feasible, and therefore recommended, by Department Heads is Option 2. This option balances budgetary pressures, the City’s risk exposure, and the public’s service expectation. An extract of this option is provided below for reference. For a
March 2, 2017 2017-2018 Business Plan Follow-up Information
complete listing of all the options, please refer back to the February 7, 2017 BIN report, a copy of which has been included in this agenda package for reference. Option 2: A combination of Staff Increases and Service Cuts The additional staffing would cost approximately $280k in 2017, $470 in 2018 and $215K in 2019. From July, 2017 to July, 2018 the second apparatus at #2 Hall would be in-service when staffing permits (i.e. when there were a minimum of 13 or 14 members on shift). The more substantial changes to the response plan would involve sending only one apparatus to a fire alarm systems activations panel call (we currently send two) and only sending one apparatus to certain types of MVAs (those not on main roads and initially described as not high impact collisions.) These two additional changes to the response plan would also eliminate about 300 runs each year. The risk of sending one apparatus to an alarms call is that if there is a significant issue triggering the alarm in these complex buildings then the ability to deal with the fire or hazardous material is delayed until the second and third apparatus arrive on scene. This recommendation has the following budgetary impact: 2017 280,000
$ / AH $8.51
% / AH 0.32%
2018 $470,000
$ / AH $14.28
% / AH 0.51%
Revised Status Should Council endorse the inclusion of option 2 for the Fire Department, as recommended by Department Heads, this would result in a further increase of 0.32% in 2017 for a revised overall increase of 4.62%. Getting Down to 4% Target Balancing needed enhancements and staying under 4% while dealing with a base budget of 3.97% has been a very challenging process. Committee asked staff to bring forward information on a number of areas to be considered as a means to reduce the overall impact to the average home owner. This included information on: reserve contributions and balances (part of the February 28th agenda package), staff vacancies and nonemergency overtime. In addition to this information, the entire budget was reviewed by the Department Heads, as well as a review of the previously recommended ongoing enhancements that were supported by Committee earlier in the budget process. In order to get the increase below the maximum of 4%, Department Heads recommend the following adjustments/reductions:
Repurposing funding from vacant positions ($284,000); Deferral of some of the endorsed enhancements until 2018 ($112,000), Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500)
Repurposing Funding From Vacant Positions The following table provides a list of positions that are currently vacant or filled on a temporary basis that Department Heads have recommended as reductions in order to get down to the 4% target.
March 2, 2017 2017-2018 Business Plan Follow-up Information
Recommended For Reduction: Position Assistant Mgr, Bylaw Services
$/AH
%/AH
(60,200) (63,200)
(1.83) (1.92)
-0.07% -0.07%
Customer Service Manager
(30,000)
(0.91)
-0.03%
Parks & Recreation Support
(66,600)
(2.02)
-0.08%
(220,000)
(6.68)
-0.25%
Mgr, Parks Planning and Design
Total
Amount
Rationale The Bylaw division is operating with one management position since the retirement of the previous manager. There is the potential to convert this exempt position into a part time CUPE position for Bylaw Enforcement Officer, resulting in the aforementioned savings. This partial funding (the remainder was Parks DCCs) for an exempt position, was held in the department until completion of the capital plan, in the event that additional resources were required to deliver the new plan. While additional resources may be required in the Capital Projects division at a later date, this funding could be repurposed in the meantime. This funding relates to a reduced scope of work and pay due to a medical accommodation for an exempt position. The revised position is now considered to be a long term solution with many of the former duties reallocated to other managers. This vacancy is the result of a recent retirement. There may be a need to revisit the need for this CUPE position when phase one of the new rec complex opens. This will be reviewed in the context of the overall staffing requirements of phase one of the rec complex at that time. Meanwhile, a decentralized facility booking model will be explored and increases in part time support through the vacancy period will be kept to a minimum.
Deferral of Endorsed Enhancements Until 2018 At the Dec 13th BIN meeting, Committee voted in favor of the following ongoing enhancements:
6-11 Financial Analyst 6-12 Engineering Studies 6-13 Supervisory Skills 6-21 Ambassador Program Total Impact
Amount 87,000 50,000 50,000 50,000 237,000
2017 $ / AH 2.64 1.68 1.52 1.52 7.36
% / AH 0.10% 0.03% 0.06% 0.01% 0.27%
Amount (6,000) (6,000)
2018 $ / AH (0.18) (0.18)
% / AH -0.01% -0.01%
Of these enhancements, Department Heads recommend deferring the Financial Analyst and the tax funded portion of the engineering studies ($25,000) until 2018. While these two enhancements are needed in 2017, it was determined that deferral of these two items would be the least detrimental to operations. This recommendation has the following budgetary impact: 2017 (112,000)
$ / AH (3.40)
% / AH -0.13%
2018 112,000
$ / AH 3.40
% / AH 0.12%
March 2, 2017 2017-2018 Business Plan Follow-up Information
Increasing the Portion of the RCMP Operating Budget Funded From Reserve Of the annual operating budget for the RCMP, $400,000 is funded from the RCMP reserve instead of taxes. The rationale is based on the fact that over the last 10 years, the RCMP has had an operating surplus in each year. Rather than taxing for funds that don’t appear to be needed, Council reduced portion of the budget funded from taxes but also set aside some money into a reserve to make up the difference should costs be higher than anticipated. Based on continued surplus in RCMP despite reducing the tax funded portion of operations, Department Heads recommend a further $100,000 be funded from the RCMP reserve instead of taxes. This does expose the City to a small amount of risk at some point, should the RCMP be able to fill a considerable amount of vacant positions. However, based on the current reserve balance of $1.5 million, a tax increase would not be required for approximately three years after the RCMP reached capacity. While a larger amount could be funded from reserves to further offset the impact to taxes, it is not recommended at this time as the RCMP foresee reducing the vacancy rate. The following table shows the RCMP surplus since 2007.
Budget 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
$ $ $ $ $ $ $ $ $ $
RCMP Surplus Actual
14,187,104 13,329,490 13,067,500 13,165,563 12,019,605 11,592,100 10,923,000 10,368,800 9,795,800 9,036,500
$ $ $ $ $ $ $ $ $ $
5 year Average 10 year Average
13,445,943 12,549,382 12,124,072 11,760,150 11,126,100 10,553,932 10,161,900 9,460,686 9,103,241 8,751,719
Surplus $ $ $ $ $ $ $ $ $ $
741,161 780,108 943,428 1,405,413 893,505 1,038,168 761,100 908,114 692,559 284,781
$ $
952,723 844,834
This recommendation would have the following budgetary impact: 2017 $(100,000)
$ / AH $(3.04)
% / AH -0.11%
2018
$ / AH -
% / AH -
Adjusting for Corporate Vacancies While it is difficult to calculate a vacancy rate given that in many cases vacant positions are either backfilled or supported through the use of contracted services to get the work done, it is unlikely that the cost for backfilling and contracting out completely offset the savings as a result of vacancies. For this reason, Department Heads recommend a blanket adjustment for vacancies of $100,000. This reduction is an addition to repurposing of the funding for existing vacant positions as noted above. As we continue to build our financial system, we will be able to better refine and adjust this figure in the future.
-
March 2, 2017 2017-2018 Business Plan Follow-up Information
This recommendation has the following budgetary impact: 2017 $(100,000)
$ / AH $(3.04)
% / AH -0.11%
2018
$ / AH -
% / AH -
-
Reducing the Net Recreation Budget The Recreation Programs CIA outlined the difference between the net operating budget and the net operating actuals showing a positive variance. There is some interest from Council to reduce the taxation allocated to recreation to narrow the gap. Based on historical results, a $50,000 reduction to the net operating budget could be made. This recommendation has the following budgetary impact: 2017 $(50,000)
$ / AH $(0.32)
% / AH -0.01%
2018
$ / AH -
% / AH -
-
Adjusting For Anticipated Savings on PST for Hydro Costs The provincial government’s 2017 budget announcement includes a provision to reduce the provincial tax on electricity to 3.5% from 7%, effective Oct 1, 2017. Should this measure pass, this would result in an annual savings of $42,000 ($10,500 for Oct - Dec 2017) to the City. Department Heads recommend this be included in the 2017/2018 budget as an adjustment. This recommendation has the following budgetary impact: 2017 $(10,500)
$ / AH $(0.32)
% / AH -0.01%
2018 $(31,500)
$ / AH ($0.96)
% / AH -0.03%
Other Budgetary Options Not Recommended In addition to the recommendations presented above, Department Heads considered a series of other options which are listed below. Vacancies Not Recommended For Reduction: Position Civil Engineer
HR Advisor
Amount 143,300
$/AH 4.35
%/AH 0.16%
108,300
3.29
0.12%
Rationale This exempt position will be critical to advancing the Infrastructure Priority in developing asset management plans and a long term capital plan. This exempt position represents 20% of staff complement in HR; a full-time position was eliminated in 2013 and legal budget was reduced in 2014 increasing workload on current staffing; key projects are not being implemented (e.g. performance management) and HR functions are being downloaded onto managers while this position is vacant; labour market continues to
March 2, 2017 2017-2018 Business Plan Follow-up Information
Position
Amount
Sign Tech
$/AH
%/AH
92,700
2.82
0.10%
Storekeeper-Buyer
100,400
3.05
0.11%
Bylaw Enforcement Officer Corporate Services Support
84,200
2.56
0.09%
27,400
0.83
0.03%
101,900
3.10
0.11%
94,700
2.88
0.11%
752,900
22.88
0.85%
Foreman III Public Works
Electrician
Total
Rationale tighten leading to greater importance on specific attraction and retention strategies that requires staff resources to implement This CUPE position is filled temporarily pending the sign tech arbitration. Should this full-time position be eliminated, we would need to contract out this work. An analysis would need to be done to determine whether this would result in cost savings or additional costs. This CUPE position is filled temporarily pending the sign tech arbitration. Without this position the Purchasing CIA implementation will continue to be delayed, including the standardization and guidance on purchasing processes which is expected to decrease costs, increase efficiencies and reduce risk. This CUPE position is filled temporarily and is required to maintain the current service levels. This part time CUPE position is filled temporarily pending the arrival of the new Corporate Officer and is required to maintain the current service levels. This CUPE position is the supervisor for the Streets area of Public Works, and is responsible for coordinating the work of the division, including planning and scheduling crews, materials, supplies, equipment etc. This position has recently been expanded as well as a result of the shared services CIA, and includes the newly created electrical division. Elimination of this position would result in these duties being re-distributed amongst the other Foreman III positions. This CUPE position was held vacant until the City was able to procure a bucket truck. Should we not fill this position, the work would still need to be completed and we would need to contract out much of the work we are planning to bring in house.
Non-Emergency Overtime Department heads do not recommend any elimination of non-emergency OT due to the detrimental impact it would have on operations.
Department Corporate Support
Corporate Support Corporate Support Corporate Support
Section Communications, Legislative and Admin
Budgeted Amount
4,700
Actual Amount
6,714
Corporate Office
900
2,867
Bylaw Services Information Services
600
5,696
10,100
10,717
Nature of OT
Impact of Eliminating OT
Support for community events outside of business hours. After hours meeting support from the Assistant Corporate Officer. Call out time for enforcement issues. System maintenance outside of business
No communication support
No Corporate Office support when the Corporate Officer is not present. No after hours bylaw enforcement. System maintenance undertaken during business hours. Impact to
March 2, 2017 2017-2018 Business Plan Follow-up Information
Department
Section
Budgeted Amount
Actual Amount
Nature of OT
Impact of Eliminating OT
hours.
customer service and productivity. Agenda cut-off deadline would need to decrease. More lead time required for budget preparation. Potential for payroll adjustments to correct pay. Delay in processing tax and utility payments. Recruitment would need to be conducted during business hours, time sensitive project deadlines may need to be extended.
Committee agenda prep and minute taking. Budget preparation, payroll processing, tax and utility bill processing. Finance
Human Resources
Development Services
Finance
Human Resources
Planning
14,200
1,900
5,600
22,547
310
To assist with recruitment that takes place outside of regular business hours, and to complete time sensitive projects. Committee support
6,985 Minutes at HCC meetings, allocation meetings, active net support
Recreation
Recreation Administration
2,600
1,710 Support for events outside business hours. Call outs for after-hours alarms. Vacancy coverage.
Recreation
Facility Services
18,300
41,660 Vacancy coverage, special events.
Recreation
Recreation
Cultural Development & Community Services
Recreation
5,000
16,100
12,522
35,092
Stat holiday facility operation, special event support, vacancy/vacation
CUPE planning staff attend Smart Growth Committee meetings as required where the member is the file manager of a development application or planning process, promoting enhanced customer service. Loss of overtime would also entail management keeping minutes. Reduced support for evening committee meetings, allocation committees, and after hours active net user trouble shooting and resolving customer service issues. Less technical and general support for event set up and take down. Evening recreation staff supervisors would be required to respond to alarm calls and/or cross training with other staff teams. Less technical maintenance support for vacation and vacancy coverage. Less staff support for special delivery, take down and set up. Less vacancy coverage – supervisory support for part time Arts and Culture program staff No full time staff support during facility operation on stat holidays; less support for special events; less vacancy/vacation
March 2, 2017 2017-2018 Business Plan Follow-up Information
Department
Budgeted Amount
Section Total
Actual Amount
$80,000
Nature of OT
Impact of Eliminating OT
coverage.
coverage.
$146,820
This option has the following budgetary impact: 2017 $(80,000)
$ / AH $(0.32)
% / AH -0.01%
2018
$ / AH -
% / AH -
-
Adjusting Annual Contributions to LTR Department Heads considered a reduction to the annual contribution to the LTR. However, as the balance saved to date in the LTR has been depleted in order to fund construction of the rec complex, no further changes are recommended as this would even further delay the time frame for LTR contributions to reach a sustainable level sufficient to fund an ongoing capital rehabilitation and replacement program.
Development Services Revenue Adjustment The approach taken by the Department since 2009 has been to use a conservative forecast to avoid impacting tax rates if an optimistic revenue projection is not achieved. This approach recognizes that the Department has limited flexibility to reduce costs (other than by reducing staff) and limited ability to influence market-driven revenues. While in the past few years we have seen higher revenues than budgeted, it is difficult to forecast if this trend will continue. The most substantial development activity has occurred in the Dominion Triangle after major roads and services were installed to facilitate growth, but this area will soon be fully developed (residential is ~90% completed; industrial ~75%). Growth through infill and replacement of existing buildings is expected to continue in 2017 and we have at least one major institutional project in the planning stages (Minnekhada School). However, offsetting higher revenue will be higher costs associated with the permit review and inspection process for the Community Recreation Complex as we will not realize any revenue from that project. Revenues generated from applications in the Planning, Building, and Development Engineering Divisions which exceed expenses are treated as surplus and contribute to the City’s overall budget demands.
Conclusion This report recommends supporting the request for additional resources in the Fire & Emergency Services Department while providing a series of adjustments to the budget in order to stay within the 4% limit indicated by BIN at the January 11, 2017 meeting. This has been a very challenging process resulting in thorough exploration of as many options as possible in the time permitted to try to find a workable solution. To stay within the 4% limit, budget reductions are recommended from the following areas: Repurposing funding from vacant positions ($220,000); Deferral of some of the endorsed enhancements until 2018 ($112,000); Increasing the portion of the RCMP operating budget funded from reserve ($100,000); Adjusting for a corporate vacancy rate ($100,000); Reducing the net recreation budget ($50,000); Adjusting for anticipated savings on PST for Hydro costs ($10,500)
March 2, 2017 2017-2018 Business Plan Follow-up Information
Based on the recommendations presented above, the revised impact to the average home for 2017/2018 would be as follows:
Base General Taxation 6-11 Financial Analyst 6-12 Engineering Studies 6-13 Supervisory Skills Fire Department Staffing Repurpose vacant positions RCMP Budget Adjustment Corporate Vacancy Rate Recreation Budget Adjustment BC Hydro Budget Adjustment Base Water Levy 6-12 Engineering Studies 6-21 Ambassador Program Base Sewer Levy 6-12 Engineering Studies Base Solid Waste Levy 6-21 Ambassador Program Parcel Tax Impact Total Impact
Amount 2,104,405 50,000 280,000 (220,000) (100,000) (100,000) (50,000)
2017 $ / AH 63.94 1.52 8.51 (6.68) (3.04) (3.04) (1.52)
% / AH 2.37% 0.06% 0.32% -0.20% -0.11% -0.11% -0.06%
Amount 2,428,300 87,000 25,000 (6,000) 470,000 -
2018 $ / AH 73.79 2.64 0.76 (0.18) 14.28 -
% / AH 2.63% 0.09% 0.03% -0.01% 0.51% -
(10,500)
(0.32)
-0.01%
(31,500)
(0.96)
-0.03%
137,440 12,500 10,000 288,500 12,500 68,095 40,000 512,500 3,035,440
3.00 0.46 0.30 10.65 0.46 4.45 1.22 25.00 106.04
0.11% 0.02% 0.01% 0.40% 0.02% 0.17% 0.05%
167,440 312,900 1,905 3,455,045
4.72 9.74 0.12 104.90
0.17% 0.35% 0.00% 3.75%
Respectfully Submitted on Behalf of Department Heads by,
_______________________________ John Leeburn CAO Attachment: February 7, 2017 Fire DP Follow Up Report
3.93%
