Committee Presentation

June 2009

Council expressed desire for change for the capital priority setting process

City Manager performance objective to develop a revised budget process

Improvement is possible

Part One : The Proposed System

Part Two: 2010 Budget Challenges

• Budget is a communications exercise– Staff with council

– Public with the City

• Principles– Council operates at policy level

– Detail delegated to staff

– Greater degree of analysis and identification of material issues within the budget

• Aim: easier for Council & Public to review

• Aim: well informed decision making

• Direction– More meaningful direction setting process

– More information and policy discussion prior to setting council direction

• Final Budget– Smaller more focused budget document

• All significant changes clearly identified

• Summary level information

• Checks and balances demonstrated

• Staff analysis to highlight information for Council

“Budget issues”◦ Matters of policy, service level, staff or political

interest

◦ Obligation to disclose and provide supporting data

“Analysis of Change”◦ Audit trail outline showing by department

adjustments to the budget

Council Approval of budget process

Today

Budget Direction & Guidelines SettingOne Day meeting

September

Budget MeetingsTwo 1 day meetings

Capital; Current January / February

•Approval of general direction

•Approval on inclusion of

•Specific budget solutions

•Identification of Capital Challenges

•Identification of base budget issues over

$100,000

•Identification of new initiatives

•Approval of current budget “road map”

•Approval of capital budget “road map”

•Summary information & analysis -enhanced

•Analysis of budget change -new

•Review of budget “issues” -new

Consultation •Public Consultation – Fall

•Council Information Sessions - Winter

June MeetingReview of the 16 budget issues

Budget Challenges and possible solutions No specific target set without further information

High level “30,000 foot” view

”10,000 foot” view

September Budget direction setting meetingPreliminary Overview of 50-100 budget issues

Specific direction set

Setting the budget

January/February Budget setting meetingsReview of budget issues

Review of Capital – by Asset Category & Projects

Borrowing from Windsor/Toronto◦ Seek input on specific questions before council

◦ Factual background data and workbook

◦ Following directions meeting

Further details will be provided at the September meeting

Commencement of budget (September 18th)◦ New priority/direction setting process

◦ More meaningful direction setting

◦ More detailed direction to staff

Completion◦ More focused document(s) and council review

process

New Budget Look

•Budget Agenda

•Proposed Agenda Format

•Proposed Departmental Format

•Proposed Capital Budget Format

City of Burlington APPENDIX A

Proposed B&SP Amendments to the 2009 Current BudgetSTARTING POINT: Originally Proposed Net Tax Levy: 108,530,952$

Updated Net Tax Levy (running total): 108,530,952$

Proposed City Tax Levy: 6.55%

Proposed Overall Tax Rate: 3.24%

Ref

Book

III Division/ Councillor Councillor Councillor Councillor Mayor Councillor Mayor Finance Amount Impact on

Item # # RefItem Description

Dept. Craven D'Amelio Dennison Goldring Jackson Taylor Thoem Dept. Approved 1-Time Funding

PROPOSED CHANGES TO "UNIQUE BASE BUDGET" ITEMSBC-014 1 33 &

37

Restore funding of $40,000 for catch basin cleaning

costs

RPM $40,000

BC-015 2 33 &

38

Restore Winter Control Brochure at a cost of

$4,000

RPM $4,000

BC-048 3 34 &

45-46

Restore support to General Brock Park Committee Clerks ?

BC-096 4 34 &

48

Remove additional week of summer programming

for Special Needs camps, Summer Neighbourhood

Activity Program (SNAP) and Youth Centres

(generates revenue of $13, 272).

School year is expected to commence before

Labour Day.

P&R $13,272

$44,000 $13,272 $0 $0 $0 $0 $0 $0 -$ -$

PROPOSED CHANGES TO "CAPITAL IMPACT ON OPERATING" ITEMSBC-043 5 55 &

59

Per C&CS resolution CC-145-08 (Oct 8th, 2008)

provide a new contract position of GTA Fare

System (Presto) Project Manager responsible for

the planning, execution and implementation of the

Presto system scheduled for Burlington in February

2010. Contract period April 1, 2009 to June 30,

2010.

Adjust contract ending date from June 30, 2010

to December 30, 2010 to align with approved

capital budget.

T&T ?

BC-044 6 55 &

60

Per C&CS resolution CC-145-08 (Oct 8th, 2008)

provide a extension of existing 3-yr contract

position of Fare System Analyst for 13 additional

months to accommodate the complexity and delay

in the implementation of GTA Fare System project.

Adjust contract ending date from March 2010 to

February 2011 to align with approved capital

budget.

T&T ?

$0 $0 $0 $0 $0 $0 $0 $0 -$ -$ Total Net Changes to "Capital Impact on Operating" Items

Total Net Changes to "Unique Base Budget" Items

CM 8/09 Appendix A 2

Impact (Millions) Tax Rate ImpactPotential Solutions with Minimal Impact Low High Low High

8Cost Containment/general revenue objective $ (1.00) $ (1.50) -0.9% -1.4%In 2009 the City budget included a 5% target for all internal departments that had not undergone cost containment in 2008. A total of $2.9 million in additional savings/ addition revenues was achieved. Cost containment of this type suffers from diminishing returns. As a result $1.0-1.5 million is viewed as realistic.

9Wage and benefit adjustments $ - ($0.51) 0.0% -0.5%In 2009 wage adjustments were established reflecting the norm in Halton Region and surrounding municipalities. Should the recession deepen further reductions may be appropriate reflecting the 2010 norm.

10Fire treated as a separate issue $ (1.10) $ (1.10) -1.0% -1.0%The Region of Halton is considering a 0% target excluding Police. The City has similar issues with the cost structure of fire and the implications of the fire master plan. It is proposed City council consider establishing a target excluding Fire.

11Use Assessment Growth to help fund 2010 budget $ - $ (0.70) 0.0% -0.7%In 2009 a significant portion of assessment growth was used to reduce taxes. The same strategy should be considered in 2010. Normally growth could fund growth related program changes. If accepted, a portion of growth could be used to offset tax rates.

Recommended Potential Solutions $ (2.10) $ (3.81) -1.90% -3.60%

Issues identified by staff in

advance

Justification provided in

advance

Part-time Equivalent = 31.0 FTE

Secretary1 FTE

Staff86 FTE

Field Services Supervisor9 FTE

Groundskeeper1 FTE

Cemetery Coordinator1 FTE

Manager of Field Services2 FTE

Secretary

Operations1 FTE

Customer Service

Representative2 FTE

Maintenance Managemnt

Clerks2 FTE

Courier1 FTE

Materials Controller2 FTE

Sign Shop2 FTE

Supervisor of

Administration1 FTE

Mechanical Staff9 FTE

Supervisor of Vehicle

& Equipment Maintenance1 FTE

Coordinator of Vehicle

and Equipment Training1 FTE

Parts & Service

Coordinator1 FTE

Manager of Fleet1 FTE

City Forester1 FTE

Technician - Program

Development, Budgets &

Contracts2 FTE

Field Services Technician2 FTE

Manager of

Program Development,

Budgets & Contracts1 FTE

Director of Roads & Parks

Maintenance1 FTE

2009 CURRENT BUDGET

DEPARTMENT SUMMARY

2007

ACTUAL BUDGET YEAR-END

ACTUAL

BASE

BUDGET

% CHANGE

vs

2008 BUDGET

PROGRAM

CHANGES

TOTAL

BUDGET

% CHANGE

vs

2008 BUDGET

9,831,921 10,263,306 10,358,319 Human Resources 10,771,758 5.0 58,630 10,830,388 5.5

4,067,307 3,902,567 4,521,262 Operating/Minor Capital Equip. 3,859,234 -1.1 45,385 3,904,619 0.1

4,900,180 5,516,455 5,825,076 Purchased Services 5,462,017 -1.0 -10,964 5,451,053 -1.2

15,000 22,000 18,551 Corp. Expenditures/Provisions 24,200 10.0 0 24,200 10.0

2,646,154 2,737,068 2,992,450 Internal Charges & Settlements 2,840,277 3.8 45,600 2,885,877 5.4

21,460,563 22,441,396 23,715,658 TOTAL EXPENDITURES 22,957,486 2.3 138,651 23,096,137 2.9

-1,538,808 -1,462,321 -1,818,011 Controllable Revenues -1,688,212 15.5 0 -1,688,212 15.5

-3,333,491 -3,369,745 -3,708,942 General Revenues & Recoveries -3,394,390 0.7 -55,600 -3,449,990 2.4

-4,872,300 -4,832,066 -5,526,953 TOTAL REVENUES -5,082,602 5.2 -55,600 -5,138,202 6.3

16,588,263 17,609,330 18,188,706 NET OPERATING BUDGET 17,874,884 1.5 83,051 17,957,935 2.0

HUMAN RESOURCES REQUIREMENTS (shown in Full Time Equivalents - FTE's)

142.0 142.0 142.0 APPROVED FULL TIME COMPLEMENT 142.0 0.0 1.0 143.0 0.7

130.1 131.0 129.0 BUDGETED - REGULAR FULL TIME (RFT) 131.0 0.0 1.0 132.0 0.8

0.0 0.0 0.0 - OVERTIME 0.0 0.0 0.0 0.0 0.0

0.0 0.0 0.0 - CONTRACT 0.0 0.0 0.0 0.0 0.0

34.6 30.7 31.3 - PART TIME/TEMP 31.0 1.1 0.0 31.0 1.1

ROADS & PARKS MAINTENANCE

2008 2009 (APPROVED)

FINANCIAL RESOURCE CATEGORIES

CITY OF BURLINGTON ROADS & PARKS MAINTENANCE DEPARTMENT

2009 ANALYSIS OF CHANGE

(Rounded to Thousands)

Description Expenditure RevenueCumulative

Cost

Change over

2008

Cumulative

Change

Over 2008

Staff Impact

(FTE)

2008 Approved Budget $22,441 ($4,832) $17,609 162.0

Base Budget Adjustments

Increased costs for full and part-time employees due to economic adjustments and benefits $508 $18,118 2.89% 2.89%

Forecasted diesel fuel costs ($92) $18,026 -0.52% 2.37%

Other Operating/Minor Capital Equipment Adjustments $153 $18,179 0.87% 3.24%

Increased Winter Control Contract Costs $178 $18,357 1.01% 4.25%

Removal of one-time expenditure and associated funding to address 2008 Gypsy Moth infestation. ($92) $92 $18,357 0.00% 4.25%

Other Purchased Services Adjustments $55 $18,412 0.31% 4.56%

Corporate Expenditure/Provision Adjustments $2 $18,414 0.01% 4.57%

Internal Charges & Settlement Adjustments $103 $18,517 0.59% 5.16%

Other Controllable Revenue Adjustments ($226) $18,291 -1.28% 3.87%

Other General Revenue and Recovery Adjustments ($117) $18,175 -0.66% 3.21%

Mitigating Cost Reduction Measures / User Fees

Reduction in fuel usage through increased adherence to the City's anti-idling policy and through improving staff

transportation planning (BC-013)

($8) $18,167 -0.04% 3.17%

Reduction of catch basin cleaning contract costs by "dewatering" catch basin cleaning vacuum trucks into the

Region's sanitary system (BC-014).

($40) $18,127 -0.23% 2.94%

Elimination of the annual Winter Control Brochure delivered to every City household by alternatively enhancing

the information provided in the fall issue of City Talk (BC-015).

($4) $18,123 -0.02% 2.92%

Transfer of sidewalk replacement funding from the Current Budget to the Capital Budget to better align the

asset replacement activity with capital financing (BC-016).

($150) $17,973 -0.85% 2.07%

A 1.5% reduction in road salt usage by continual technological upgrades of spreading equipment and

techniques (BC-017).

($13) $17,960 -0.08% 1.99%

Energy savings and reduced bulb replacement costs due to accelerated completion of transition to LED signal

fixtures (BC-018).

($85) $17,875 -0.48% 1.51%

New Services/Programs (Recommended)

Additional Street Sweeper Operator to meet Council-approved service levels in Roadway Sweeping, and to

reduce contracted sweeping services during the Spring Clean-up and Leaf Collection programs (BC-050).

$88 ($46) $17,917 0.24% 1.75% 1.0

Other growth related impacts: additional signalized intersections, streetlights, and horticultural beds (BC-051,

BC-052, BC-053).

$41 $17,958 0.23% 1.98%

Recycling Pilot in Tansley Park - Strategic Action 5.4C Future Focus Seven Work Plan/Implementation Plan

(BC-077).

$10 ($10) $17,958 0.00% 1.98%

2009 Approved Budget $655 ($306) $17,958 0.00% 1.98% 163.0

Uncommitted Other Initiatives

EXAMPLE Reduction of Service ABC (BC-999) ($100)

Tried and tested◦ Well received by staffs and councils

Efficient use of resources◦ Detail delegated to staff

◦ Smaller, more concise budget document

◦ More focus on “budget issues” (service, policy, staffing or matters of political interest)

User Friendly for City Council and Public

Quote from: Albert Einstein

Definition of insanity

“Insanity: doing the same thing over and over again and expecting different results”

If we approach the 2010 budget in the same way as 2009 we should expect the same results.

Analysis of 2009 Current Budget

Draw conclusions ◦ 2010 possible outcomes

◦ Key cost drivers and assumptions

Broad Council Direction Requested ◦ Solutions to explore for September

Net Tax Levy

*- Areas not previously subject to full cost containment

2010 has similar challenges to 2009◦ Total dollar challenge $9.6 million vs. $11.4 million

Cost Containment ◦ 55% of budget participates

◦ Diminishing returns

◦ Revenues

2009 market adjustments/new rates

Slower Assessment Growth

GST / PST Harmonization (costs and fees charged)

Reliance on reserve funds not sustainable to offset tax increases

Capital impact on 2010 3.2 %◦ Operating Impacts from Capital Projects

Alton Community Centre / Library

Appleby Ice Expansion

Performing Arts Centre

◦ Unmet capital needs

Parks and Rec master plan > $30 million

Cycling Master plan $20 million

Facility assets – expect to see unmet needs

A 2010 change to capital◦ Has impact over 10 years

◦ Requirement to maintain base funding for Federal Funding Programs

Issues 1-7◦ Challenges as we see them

Issues 8-11◦ Recommended lower impact approaches

Issues 12-16◦ High impact alternatives

Starting point – 9% tax increase

Final Increase ( Not including significant impact

items)

City Portion 4-5% (still requires high effort & savings)

Total Blended Impact on tax bill 1.53% - 2.68%

Should Council wish to be below 1.53-2.68%◦ Provide direction with respect to Appendix A

City has competitive tax burdens (BMA Municipal Study 2008)

Questions

Consider process recommendation

Consider Appendix A items 1-16