committee of the whole meeting...city of kamloops | committee of the whole meeting background the...

City of Kamloops

Committee of the Whole

Meeting

November 19, 2019

313622

City of Kamloops | Committee of the Whole Meeting

RECOMMENDATION:

That Council proceed into Committee of the Whole, and

approve the agenda.

APPROVAL OF THE AGENDA


RECOMMENDATION:

That the minutes of the October 29, 2019, Committee of the

Whole meeting be adopted.

MINUTES


REPORTS


PURPOSE:

To seek the Committee of the Whole’s support for the

priorities outlined in the 2019–2022 Corporate Action Plan

2019–2022 CORPORATE ACTION PLAN


SUMMARY

Pillar Complete Current Ongoing Y2 Y3 Y4 Future

Governance

and

Accountability

4 34 50 22 6 1 -

Livability 6 35 53 20 8 2 -

Environmental

Leadership2 11 23 18 - - 2

Vibrant

Economy- 7 8 7 2 - 3

Total 12 87 134 67 16 3 5


RECOMMENDATION:

That the Committee of the Whole recommend that Council

approve the priorities outlined in the 2019–2022 Corporate

Action Plan, as shown on Attachment “A”.

2019–2022 CORPORATE ACTION PLAN


BUDGET 2020-2024

City of Kamloops | Committee of the Whole MeetingCity of Kamloops

Asset Management

Update

November 19, 2019

313622


ASSET MANAGEMENT PROGRAM UPDATE

Purpose:

To provide Council with information on the current status and progress of the Corporate Asset Management Program.


Supports Council’s strategic priorities and areas of focus

regarding:

COUNCIL STRATEGIC PLAN

Governance and Accountability• Asset Management: We proactively plan for the repair and

replacement of our infrastructure.

• Fiscal Responsibility: We are fiscally responsible and accountable.

Environmental Leadership• Climate Action: We enhance the City’s resiliency and capacity for

mitigating and adapting to the impacts of climate change.


BACKGROUND

The benefit of a strong asset management program helps the City do the

following:

• provide for the stewardship of public assets, which is a core purpose of

local governments, as defined in Section 7 of the Community Charter

• allocate financial and human resources effectively and efficiently

• balance the community’s service expectations with its willingness and

capacity to pay for the services

• effectively manage risks to public and staff safety, the environment,

municipal finances, and the City’s reputation

• provide a structured to use this data to make informed decisions about

the acquisition, operations, maintenance, renewal, and replacement of

assets


BACKGROUND

What are the goals of our asset management program?

• the right intervention is made on the right asset at the right

time

• service delivery is financially sustainable both today and in

the future

• services are provided in a way that balances trade-offs

between life cycle costs, risks, customer expectations, and

willingness to pay


BACKGROUNDWhat are the objectives of our asset management program?

• demonstrate organizational alignment, commitment, and

collaboration

• relevant and reliable data about assets is available to those

who need the information.

• life cycle costs, risk, and impacts to level of service—and

trade-offs between them—are considered in planning

processes and whenever decisions are made about City

assets

• resources are in place to enable sustainable service delivery

and continuous improvement in asset management


BACKGROUND – Asset Management Program

InventoryAsset

MaintenanceService Levels

Inspection and

Condition Reports

Determine Replacement

Costs

Long-term Financial Program

Asset Management Program


HISTORY

The program began in 2009, focusing on:

• inventorying the city assets

• implementing a life-cycle cost tracking tool (Asset

Maintenance)

• aligning assets to services levels

In 2012 the Public Sector Accounting Board (PSAB) introduced requirements for the formalized accounting of Tangible Capital Assets (TCAs)


HISTORY

in the last 2 years:

• established a cross functional Asset Management Working

Group

• applied for and received the Province of BC Infrastructure

Planning Grant – monies use to engage Urban Systems to

develop the Asset Management Policy

• developed the preliminary Asset Management Classification

structure

• applied for and received the UBCM Asset Management

Grant that will be used to develop the Asset Management

Strategy


ASSET MANAGEMENT CLASSIFICATIONS - 2019

Water System Information

System Sanitary System Drainage Solid Waste

Parks and Cemeteries

Transportation Network

Buildings & Structures

Equipment

• Mains

• Reservoirs

• Booster

Stations

• PRVS

• Treatment

Plant Systems

• Dams

• Irrigation

• Enterprise

software

• Enterprise

hardware

• Desktop software

• Desktop

hardware

• Enterprise

infrastructure

• Mains

• Lift Stations

• Treatment

Processing

• Landfills

• Diversion Sites

• Containers

• Dikes

• Pumps

• Ponds

(retention)

• Drainage

Collection

• Cemeteries

• Sports Fields

• Multi-useCourts

• Trees

• Amenities

• Roads

• Sidewalks /

Pathways

• Bridges

• Parking Lots

• Street /

Traffic Lights

• Signs

• Arenas

• Pools

• Recreational

• Community/Lease

• Admin/Operational

• Water Buildings

• Sewer Buildings

• Solid Waste

Buildings

• Retaining Walls

• Parkades

• Fleet

• Specialty

Equipment


Establishes a high-level, systematic

approach that supports local governments

in moving toward service, asset, and

financial sustainability through an asset

management approach

The Framework addresses:

• why asset management is necessary

• what asset management is

• how it can be implemented

THE ASSET MANAGEMENT BC (AMBC) FRAMEWORK


CHALLENGES FOR ALL MUNICIPALITIES

External Factors

• rising operating expenses

• stagnating revenues

• new / increased service offerings

• demands for new infrastructure

• insufficient reserves funds

• short-term focus (Council)


CHALLENGES FOR ALL MUNICIPALITIES

Internal Factors

establishing appropriate asset

classification

• maintaining an accurate inventory

• aligning asset use and service levels

• managing risks appropriately

• developing and implementing a long-

term financial program and longer

capital program


WHAT THE DATA TELLS US

$0

$20

$40

$60

$80

$100

$120

$140

$160

0 - 5Years

6 - 10 Years11 - 20 Years21 - 30 Years31 - 40 Years41 - 50 Years51 Years andBeyond

mill

ion

s

Timing of Replacement based on Theoretical Useful Life BRIDGES



$0

$1

$2

$3

$4

$5

$6

$7

$8

$9

$10

mill

ion

s

Years

Timing of Replacement based on Theoretical Useful Life

Fleet Reserve Contribution

FLEET



$0

$10

$20

$30

$40

$50

$60

$70

$80

Less than 0 0-5 years 6-10 years 11-20 years 21-30 years 31-40 years 41-50 years more than50 years

mill

ion

s

Timing of Replacement based on Theoretical Useful Life WATER MAINS


How Do we Use the information and where does it come from


RECOMMENDATION:

That the Committee of the Whole receive the Asset Management

update for information.

ASSET MANAGEMENT UPDATE


IT AND DIGITAL

STRATEGY UPDATE

November 19, 2019

313622


PURPOSE:

To provide the Committee of the Whole with an update on

the Information Technology (IT) Division and the Digital

Strategy.

IT AND DIGITAL STRATEGY UPDATE



regarding:


• Environment – implement strategies that reduce our

impact on the environment by improving technical

capabilities to reduce paper and manual processes,

reduce travel, and promote collaboration

• Infrastructure - invest in the long-term financial stability

of our assets and improve the overall infrastructure

standards of the city by developing strategies to replace

dated IT assets


SUMMARY

• Early 2018 CGI Information Systems (CGI) engaged to

assess current state of technology.

• The City of Kamloops IT Division initiated a technical

assessment summer of 2019.

• Both have been combined into a multi-year roadmap.

• An IT Modernization Program has been kicked off to

manage, design and implement the roadmap activities.


DIGITAL STRATEGY REPORT

• Process:

- Assess current state

- Identify potential future states

- Develop recommendations

• Recommendations were grouped into People, Process and

Technology categories.

• What is People, Process and Technology?

• It is a common framework used in Business Transformation activities


WHAT IS PEOPLE, PROCESS, TECHNOLOGY?


TECHNICAL ASSESSMENT

• In Spring 2019, RFP issued to secure an IT Services

Partner

• Goal was to find a partner that brings technical expertise

and experience to help us execute the Digital Strategy

• Initial activity was a detailed Technical Assessment

completed

Summer 2019

• Several recommendations where identified


DIGITAL STRATEGY ROADMAP

• Recommendations from both the Digital Strategy and

Technical Assessment were combined into one plan

• A roadmap has been developed to address immediate

items and plan for future phases

• An IT Modernization Program using Project Management

best practices has been initiated to implement the

roadmap


DIGITAL STRATEGY ROADMAP

• Details are not important at this time; size and scope is

• Roadmap is in Draft format only; as more information is uncovered additional items will be added/moved

Q2 Q3 Q4 Q1 Q2 Q3 Q4SEP OCT NOV DEC JAN FEB MAR2019 2020 2020 2021

Assessment

Wireless Remediation

Unified Communications Remediation

Data Resiliency

Patch Management

AD Design AD Migrations

Backoffice Upgrade ImplementationBackoffice Upgrade Design

Network Remediation Phase 1

IT M

od

ern

iza

tio

n

Firewall Resliency Network Remediation Phase 2

Core Network Resiliency

Fibre Ring Resliency

Monitoring and Alerting Access Management

DR Planning DR Implementation


DIGITAL STRATEGY ROADMAP HIGHLIGHTS

• Several factors were considered to develop the roadmap:- Expand IT Asset Management from physical replacement of

computers, laptops and phones to include all of our IT

Infrastructure

- Digital security and protection underlies all work and priorities

- Focus on our infrastructure foundation first and then build up

- Implement technologies that will enable new capabilities

- Apply Total Cost of Ownership (TCO) principles by balancing

short term costs with long term savings



• Overall, this requires 3-6 years of remediation work to properly address

• Most of the first 2 years will be “under the hood” work but we will include some organizational improvements

- Improve internal wireless access

- Move to a modern email and calendar technology

- Implement technologies that support “Single Sign-On” that allow

users to login once and access all their applications



• After the foundational work is complete, we will transition

to enabling capabilities:

- Allow other groups to provide different levels of service such as

pervasive mobile citizen engagement

- Allow us to pursue Smart City services and operational

efficiencies

- Allow us to begin automating internal processes


BUDGETS

• IT Reserve funding process already in place to replace

technical assets

• Some of the funding would be shifted to purchase services

instead of technical assets

• Additional operational funding of $250K is required to

complete these asset management (IT) initiatives

• There are a number of unknowns that will be uncovered as

the roadmap is implemented


KAMLOOPS COMMUNITY NETWORK (KCN)

• Background:

- In 2005, the City of Kamloops built a high-speed fibre network ring

connecting our major facilities

- This immediately reduced our costs to purchase these services from

other providers

- Initial partners were brought on-board to use the service, and share in

costs and revenues

- Over the years, the network itself has expanded but the business

model has not been reviewed

- While it serves the City and our partner needs, it has not expanded

beyond that


KAMLOOPS COMMUNITY NETWORK (KCN)

• In order to develop a plan on how to better utilize the KCN, IT

has undertaken a KCN Commercialization Study through our IT

Services Partner.

• This study will:

- Review our current implementation and business model

- Gather feedback from a set of current and potential customers

- Identify commercialization opportunities

- Provide options and recommendations

• Target completion is Spring 2020


RECOMMENDATION:

That the Committee of the Whole receive the IT and Digital

Strategy Update for information.

IT AND DIGITAL STRATEGY UPDATE


2020 UTILITY FUNDS

NOVEMBER 19, 2019

313622


PURPOSE:

To provide Council with a summary of the 2020 – 2024

Financial Plan for the Utility Services

2020 UTILITY FUNDS



regarding:


Governance and Accountability• Asset Management: We proactively plan for the repair and replacement of our

infrastructure.

• Fiscal Responsibility: We are fiscally responsible and accountable.

Livability• Safety: We recognize the importance of a safe and secure community.

Environmental Leadership• Climate Action: We enhance the City’s resiliency and capacity for mitigating

and adapting to the impacts of climate change.


Utility funds consists of:

• Water

• Sewer

• Solid Waste and Recycling

Accounted for separately from general operating and capital funds

Each fund sets rates to cover the related operating / capital costs and all surplus funds are set aside for future management of the assets

Utilities overview


SUMMARY

Change in Surplus Reporting Methodology (Water and

Sewer)

• Historically surplus balances were presented as a percentage

of annual revenue

• This method failed to consider asset health and the need to

replace aging or end of life equipment

• Linking surplus (reserve) balance to asset value provides a

stronger financial asset management relationship


2020 Projection Water Sewer

Projected 2020 Ending Surplus Balance $8,533,000 $5,908,000

Projected 2020 Budget Revenues $17,243,000 $16,508,000

Surplus as a % Budget Revenues 49.49% 35.79%

Historical Investment Costs – 2018 $180,858,000 $101,202,000

Surplus as a % of Historical Investment Costs 4.72% 5.84%

Net Book Value - 2018 $108,190,000 $71,634,000

Surplus as a % of Net Book Value 7.89% 8.25%

(Net Book Value – depreciated value of assets)

SUMMARY


SUMMARY

Water

• The utility is financially strong due to effective asset management practices

• Anticipation in the water reserve to grow over the 5 year plan related to assets valuation

• Administration does not recommend any rate changes for 2020


SUMMARY

Sewer• Identified in the 2019 Utility Funds Report to Council, the

sewer utility requires a 7% rate increase for 2020

• Recent approved increases have been required to address

the management of bio-solids and support effective asset

management

• The increase this year provides the financial resources to

complete Phase 2 and 3 of the Tranquille Road sewer main

replacement projects without incurring any debt


SUMMARYSewer, continued

• Staff continue to seek efficiencies in the operation of the sewer

collection and treatment systems:

• The staff at the Kamloops Sewage Treatment Center have implemented

process changes resulting on a $155,000 cost reduction in electrical power

required

• This reduction is the result of a multi-year effort by staff researching

opportunities to optimize the performance of the blowers that provide critical

air to our treatment process.

• Staff working on the sewer collection system are trialing a new

technology that will provide a reduction in frequency in sewer main

flushing requirements through predictive modeling.


SUMMARYSolid Waste

• The solid waste utility remains balanced and healthy, with ongoing efficiency improvements within the collection sector and strong revenues through landfill tipping fees

• The Solid Waste Reserve is currently healthy in anticipation of funding significant upgrades required at all three landfill sites

• These projects are required based on the existing operational certificates and active Design and Operations and Closure Plans for each site

• Administration does not recommend any rate changes for 2020


Utilities Cost to AverageHousehold

2019 2020 $ Change % Change

Utility Rates:

Water $ 379 $ 379 0 0.0%

Sewer $ 417 $446 $29 7.0%

Garbage and Recycling $ 152 $ 152 0 0.0%

PROPOSED UTILITY RATE CHANGES -2020


$0

$100

$200

$300

$400

$500

$600

2019 2020 2021 2022 2023 2024

Water Sewer Solid Waste

PROPOSED UTILITY RATE CHANGES2019 - 2024


RECOMMENDATION:

That the Committee of the Whole authorize:

a) Staff prepare a Sanitary Sewer Amendment Bylaw to be

brought forward at a later date

2020 UTILITY FUNDS


ADJOURNMENT

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