Report to: General Committee                                                 Report Date: November 9, 2009

 

 

SUBJECT:                          Town of Markham 2010 Budget

PREPARED BY:               Joel Lustig, Director of Financial and Client Services

                                            Veronica Siu, Acting Manager of Financial Planning

 

 

RECOMMENDATION:

 

1)      That the report dated November 9, 2010 entitled, “Town of Markham 2010 Budget” be received;

 

2)      And that Council approve the 2010 Operating Budget for Town services which totals $153,807,527, (excluding prior year surplus/deficit) the principle components of which are detailed on Appendix 1;

 

3)      And that gross operating expenditures of $153,807,527, (excluding prior year surplus/deficit) be funded from the following sources:

 

 

4)      And that Council approve the 2010 Capital Budget that totals $77,919,500, the funding details of which are listed in Appendix 2;

 

5)      And that Council approve the 2010 Waterworks Operating Budget that totals $67,297,242, (excluding prior year surplus/deficit) the principle components of which are detailed on Appendix 4; 

 

6)      And that Council approve the 2010 Planning & Design Budget that totals $4,883,518, (excluding prior year surplus/deficit) the principle components of which are detailed on Appendix 5;

 

7)      And that Council approve the 2010 Engineering Budget that totals $5,157,982, (excluding prior year surplus/deficit) the principle components of which are detailed on Appendix 6;

 

8)      And that Council approve the 2010 Building Standards Budget that totals $7,155,944, (excluding prior year surplus/deficit) the principle components of which are detailed on Appendix 7;

 

9)      And further to the finalization of assessment growth numbers on the return of the 2010 assessment rolls in December 2009, the Treasurer be authorized to adjust the 2010 tax rate and resulting levy to reflect a zero percent tax rate increase. 

 

10)  And any resulting surplus be transferred to the Corporate Rate Stabilization Reserve;

 

11)  And that upon finalization of the 2009 audited financial statements, the 2010 Operating, Waterworks, Planning & Design, Engineering and Building Standards budgets be adjusted to reflect the 2009 operating results;

 

12)  And that a copy of the budgets be made available to the public through the Clerk’s Department and each of the Markham Public Libraries;

 

13)  And further that Staff be authorized and directed to do all things necessary to give effect to this resolution.

 

1. Purpose   2. Background   3. Discussion   4. Financial  

PURPOSE:

To obtain Council approval of the Town of Markham’s 2010 Budget.

 

BACKGROUND:

A total of three Budget Sub-Committee meetings were held in 2009 to discuss, review and finalize the 2010 Operating, Capital, Waterworks, Planning & Design, Engineering and Building Standards budgets.  All Budget meetings were open to the general public, Members of Council, Commissioners, and staff.  Topics discussed at the Budget Sub-Committee meetings include:

  • a review of the Operating and Capital budgets for 2010;
  • an analysis of the significant factors affecting both the 2009 actual performance and the 2010 Operating budget;
  • fiscal scan including economic trends and budgetary pressures;
  • the Town’s asset lifecycle replacement methodology and reserve fund impacts;
  • a review of the funding allocations from the Infrastructure Stimulus Fund and Recreational Infrastructure Canada Fund;
  • a review of the Building Standards, Planning & Design and Engineering Operating Budgets;
  • a review of the projected 2010 Building Standards, Planning & Design and Engineering reserve balances;
  • Water & Wastewater Reserve Study.

 

On November 4, 2009, a 2010 Budget Public Information Meeting was held in the Council Chambers. Questions raised by the public are addressed in a separate presentation to General Committee at this November 9, 2009 General Committee meeting.

 

DISCUSSION:

 

Operating

The following exhibit reconciles the 2009 Approved Operating Budget to the 2010 Operating Budget from $151,268,685 to $153,807,527 (figures exclude Planning & Design, Engineering, Building Services and Waterworks):

 

 

The 2009 Operating surplus/deficit is excluded from the above figures until the Town’s audited financial statements are finalized and approved by Council.  Upon finalization of the 2009 audited financial statements, the 2010 Operating, Planning & Design, Engineering, Building Standards and Waterworks budgets will be adjusted to reflect the surplus/deficit, if any, in revenues and offsetting expenditures. 

 

The Town of Markham continues to face inflationary pressures in many aspects of its operations. General inflation, waste collection and winter maintenance contracts, other contract renewals, and wage settlements have resulted in increased operating expenditures.  Further, the Budget Sub-Committee has approved the continuation of the Town's practice of phasing-in future personnel costs related to facility openings and funds have been allocated towards the Cornell Fire Station, the next Library/Recreation facility and future sports facility.  In addition to inflationary pressures, Markham continues to add to its inventory of parks, streetlights, and roads each year, thereby requiring additional resources for the maintenance and replacement of these assets.  To mitigate the increased expenditures, Staff reviewed and identified the following expenditure reductions:

 

·        $0.5M by reduction in the utility budget through lower consumption resulting from Town-initiated energy efficient programs

·        $0.2M reduction in the Town’s fuel budget due to lower consumption resulting from Town-initiated energy efficient programs

 

Further, $2.6M reduction in tax-funded capital budget was achieved through the following measures:

 

·        $1.0M was saved through the development of a pavement preservation strategy.  This strategic initiative preserves the roads by proactively treating the surface early in its life to prolong its state of good repair.  In fact, this method strengthens the roads during the rehabilitation for longer life and it employs green technologies to reduce emissions, save energy and recycle aggregates and asphalt

·        $0.8M by deferring and/or sustainable reductions in the capital program

·        $0.5M use of alternative funding source (gas tax)

·        $0.3M by extending the life cycle of Town owned fleet

 

The total impact of the above pressures and reductions on expenditures is $2.5M.

 

Also, the revenues were reviewed and increased by $3.1M in the areas of assessment growth and investment income.

 

Capital

The proposed Capital Budget of $77.9M includes funding from various sources, as outlined in Appendix 2.  A complete listing of the proposed 2010 Capital budget projects is included in Appendix 3.  The 2010 Capital budget includes $4.2M from the Federal Gas Tax grant, which will fund capital projects in the following areas:

 

·        Facility Energy Retrofits

·        Curb & Sidewalk Repairs

·        Green Print Community Sustainability Plan

·        Culvert Replacement

·        Civic Centre Conversion to MDE Connection, and

·        Storm Sewers Upgrades

In addition, the Town received funding from the Infrastructure Stimulus Fund in the amount of $8.8M and the Recreation Infrastructure Fund in the amount of $5.1M 

 

The Infrastructure Stimulus Fund is being used to fund the following projects;

 

·        Facility Accessibility Retrofits ($2.1M)

·        Facility Energy Retrofits ($2.0M)

·        Emergency Operations Centre Retrofit ($0.7M)

·        Thornhill Community Centre & Library Renovations/Additions ($4.0M)

 

The Recreation Stimulus Fund is being used to fund the following projects;

 

·        Saint Roberts Artificial Turf and Bubble ($2.0M)

·        Tennis Court Facility at Angus Glen Community Centre & Library ($1.1M)

·        Outdoor Civic Centre Skating Rink ($2.0M)

 

Other significant Capital projects include the continuation of the tree planting initiative, construction of the Cornell Fire Station, erosion protection and stormwater management projects , waste management initiatives (including new and continuing recycling programs), continuation of Travel Demand Management, design & construction of 6 new parks, town-wide illumination & sidewalk requests, rehabilitation of bridges & culverts, road rehabilitation across the Town, watermain and sanitary sewer construction & replacement, facility improvements at town-owned buildings, permanent washrooms on Markham Main Street, a pool sanitization upgrade at Milliken Mills pool, and the continuation of the facility accessibility program.

 

The proposed 2010 Budget reflects the Town’s commitment to maintain service levels to the community and balances social needs with fiscal prudence. This is a reflection of the Town’s commitment towards fiscal stewardship.  Further, consistent with existing Town policies, one-time funding is not used to balance the operating budget and the Town's commitment to increase contribution to the capital program by $0.5M is maintained.  The Town has also continued to ramp-up the operating budget for future expenditures related to new community centres, libraries and fire Stations.  In addition, the Town will be contributing of $0.3M to each of the Land Acquisition and Environmental Land Acquisition Reserve Funds.

 

The current 2010 budget reflects an assessment growth assumption that may be conservative. Upon receipt of the final assessment growth figure in December of this year, the 2010 tax rate will be adjusted to reflect a zero percent tax rate increase and any surplus funds will be transferred to the Corporate Rate Stabilization Reserve.

 

 

RECOMMENDED

                            BY:    ________________________          ________________________

                                      Andy Taylor, Commissioner                Barb Cribbett, Treasurer

                                       Corporate Services

 

 

 

ATTACHMENTS:

Appendix 1 – 2010 Operating Budget

Appendix 2 – 2010 Capital Summary by Commission & Sources of Funding

Appendix 3 – 2010 Capital and Other Programs Budget

Appendix 4 – 2010 Waterworks Operating Budget

Appendix 5 – 2010 Planning & Design Operating Budget

Appendix 6 – 2010 Engineering Operating Budget

Appendix 7 – 2010 Building Standards Operating Budget

Appendix 8 – November 4, 2009 Public Meeting Presentation