The following items of general interest are on Monday’s Agenda:

• A presentation on the Bowen Road/ Quarterway Bridge Improvement project;
• A delegation on the newly minted Communication Officer position;
• Advisory Committee on Environmental Sustainability’s 2012 Work Plan;
• Grant’s Advisory Committees recommendation to provide $1,397.42 for an annual volunteer luncheon (I would not include this, but I wonder how many other volunteer luncheons might be forthcoming);
• 2012-2016 Financial Plan Bylaw Amendment;
• A report on the cost of acquiring the West Linley Valley land for a park;
• Staff’s recommendation that, for accessibility reasons, all FPCOW meetings be moved to the Shaw Auditorium until the new Annex Building is completed;
• Staff’s recommendation that, for reasons of accessibility, all Advisory Committees, etc. currently meeting in the City Hall Board Room be moved to new and accessible locations;
• That Zoning Bylaw 2011 No. 4500.004 to amend the height restrictions within the Single Dwelling Residential (R1/R1a) zones be abandoned;
• That Council rescind third reading of Financial Plan Bylaw 20112 No. 7144;
• That Council pass third reading of the Financial Plan Bylaw as amended.

The meetin will be held in the Shww Auditorium at the Conference Centre at 7pm.

The full agenda can be found at:

http://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2012_Agendas/C120227A.pdf

__________________________________

As an aside, I note that as of this evening  (Feb. 24, 2012), Campaign Finance Documents from Mayor Ruttan and Councillors Brennan, Kipp and McKay have not appeared on the City web site.  See:

http://www.nanaimo.ca/EN/main/departments/Legislative-Services/4609/2011GeneralElection/CamFinDisclose.html

Legislation gives them until March 19 to report, but as they are currently voting on budgets, contracts, rezonings and developments, this information should be available now.  It is hard to understand how the banks with all their complicated transactions, can provide tax information within 60 days while it appears difficult for our elected officials to produce theirs in the 90+ days since the election.  It likewise remains to be seen whether other Campaign Organizers will submit documents.

Mayor Ruttan and Councillors:

Before you pass three readings of the Financial Plan Bylaw tonight, thus filling that mold with cement which, though it may not be fully set until April, becomes harder to rework with each passing day, I would like to ask that you give more consideration to this plan and to the hardships which it may offer to many, if not most, citizens of Nanaimo.

For as long as memory serves me, Council has approved budget increases which have considerably exceeded the increase in the BC Consumer Price Index.  This year that increase is currently set at 3.8% for residential taxpayers, compared to a BC cost of living increase of 1.7%.

Other than the brief discussion of adding an “Internal Auditor”, a position that frankly in the light of the imminent appointment of a Municipal Auditor by the Province, seemed a straw man or woman in any event, and was subsequently cut, I remember no serious discussion of the proposed $160 million dollar budget which is before you tonight.  Neither do I remember hearing, prior to Staff’s introduction of this budget submission, that Council had provided any direction to Staff in its preparation.

This is unfortunate and is exacerbated by the fact that on at least two occasions at which I have been present, attempts by individuals on Council to discuss such matters were promptly quashed by other Council members who raised Points of Order, indicating that their venues were not the place for the discussion of such matters. Where is the place and the time at which these matters of vital public interest are discussed and what is the public’s right to be party to them?

Without getting into budgetary details I would like to request that you review some budget issues which have apparently been ignored.  The first is the matter of the old city annex.  For most of us, deciding to build a new home rather than renovating our old one involves prior planning on what we will do with the old one as this decision is vital to our financial statements needed to obtain a mortgage.  While the new Annex rises and the old one is to be emptied by the end of this year, where is the financial plan for this depreciating asset which will, even if empty, consume at least heating and maintenance dollars?  Nanaimo’s residential and business taxpayers are required to have an all-encompassing when we want a new home.  Why does the City ignore the existing real estate in our five year plan?

We have also had considerable discussion about the need for some $65-75 million dollars for a new water supply to meet the demand of future growth.  You have recently authorized the expenditure of up to $560,000 for a study of a possible new dam site at a location which is owned privately, additionally is apparently contested under the Douglas Treaty, and further is apparently not the preferred option in any event.  This is a lot of high stakes taxpayer money to be spending in an environment which appears about as ambiguous as it can get. Statistics Canada’s 2011 population data for Nanaimo removes nearly 4000 people from the informal estimates which have been used by the City for that same period in discussing the need for a new water source.  Perhaps we should use the time to reduce the risky ambiguities associated with growth before we charge ahead as we have sometimes done in the past.

An equally important consideration in the development of such a major project to serve the needs of the yet to come is how it should be funded.  It has been repeatedly stated that the new water source is needed to accommodate anticipated growth and are not needed for our existing population plus another 16,000 or so newcomers.  Let alone resolving the question of whether we can afford growth, why in the plan is there no discussion of the need to increase Development Cost Charges to recover the anticipated costs associated with that growth?  Are present taxpayers expected to pay for new growth?  Have you heard of any old established business which pays people to use its services and yet is not in ultimately dire straits?

And last but not least there is the question which looms over all… the cost of maintaining the infrastructure which we already have.  The last estimate I heard for the City of Nanaimo’s assets was $1.8 billion (with a B) dollars.  With New Annexes, Bowen Road Widening, the coming new water treatment plant, a possible dam, other gleams in Council’s eye such as tax exemptions, fast ferries, a multiplex, etc. which are still on hold –well maybe not the tax exemption which forms part of tonight’s vote on the Financial Plan- where do our assets stand now, and how do we propose to pay to maintain them all?  I have heard estimates that we are deficient by about $12 million per year in meeting the maintenance demands of our infrastructure.  When will the hammer fall on these expenses which are accumulating and compounding as time goes on.

This Financial Plan needs much more discussion and much more transparency and orientation to the problems which we know are coming our way.  Please take time to do proper due diligence.

The full agenda for this meeting can be found at:

http://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2012_Agendas/C120213A.pdf

At this meeting Council will be making a number of amendments to the Zoning Bylaw, some of which bring about substantial changes.  If unsure of how these changes might affect your neighbourhood, see the agenda.

It is also likely that Council will give the first three readings to “FINANCIAL PLAN BYLAW 2012 NO. 7144″.  This bylaw will set the following tax rate increases:

There is also an annual increase of 5% to water fees and 6.14% ($7.00) to garbage/recycling fees in 2012, but no increases for sewer are proposed.

The total impact of the proposed budget on a typical single family home (assessed at $350,000 in 2012), including the ·increases for water and garbage, is $90.67 or about 3.9% increase over 2011. This is only for the City of Nanaimo portion of the tax bill. This does not include any other taxing agency (school, hospital, Regional District of Nanaimo), as all of these increases are not known at this time.

Changes made since the plan was first introduced to Council include:

• Elimination of the Internal Auditor position ($150,000)

• Increased funding for Strategic Planning ($23, 175)

The Community Charter requires the Financial Plan bylaw to include a revenue policy. This year, the policy has been amended to include the following statements:

“4. Revitalization Tax Exemptions

• The City of Nanaimo believes that Revitalization Tax Exemptions are an appropriate tool to assist the City in realizing its strategic objectives.

• The City can exempt municipal taxes for up to ten years for projects undertaken by landowners, where the project meets defined objectives of a City strategy.

• Recipients of exemptions must enter into a Revitalization Tax Exemption Agreement with the City.

• Every Revitalization Tax Exemption must be approved by Council.”

The financial plan and tax rates bylaws must be adopted by 2012-May-15. Council will have an opportunity to review the 2012 – 2016 Financial Plan Bylaw in April prior to final adoption of the Property Tax Rates Bylaw. Adopting the 2012 – 2016 Financial Plan Bylaw now authorizes the expenditures in the 2012 budget and allows staff to proceed with the various projects included in the financial plan.

I don’t know if you have heard any significant discussion of this financial plan, but I know that I have not.  It increases residential rates by 3.8%, more than twice the 1.7% increase in the BC consumer price index for last year.  It ignores the situation of what to do with the old city annex after it is emptied later this year.  It ignores continuous increases in water rates and their relation to new water supplies.  It has been repeatedly reported that a new dam, a project for which Council has now authorized the expenditure of up to $560,000, is not needed for our existing population, but is oriented to new growth.  In this case, funding for this project should be not be subsidized by existing taxpayers, but be collected from Development Cost Charges.  Discussion on the subject of whether we should consider putting controls on growth was quickly suppressed at a recent FPCOW meeting.

While it will theoretically be possible to make changes to the financial plan up to its final reading in April, passing third reading now sets the wet cement in place which mitigates changes with every passing week and “allows staff to proceed with the various projects included in the financial plan.”  Is this minimal scrutiny of the budget what was desired when our new Council was elected?  Or is it impossible to keep city taxes in line with the cost of living?

Statistics Canada began the public release of 2011 population data yesterday (Wed. ,Feb. 9, 2012).  The data for Nanaimo showed a population for the city of 83,810, up from 78,692 in 2006, giving a growth rate of 6.5% over the five year inter-census period or about 1.26% per year.  This contrasts with the growth rate of 11.1% for the five years which is shown in the City’s Community Profile-2010 document which projected our 2011 population to be 87,464.  See:

http://www.nanaimo.ca/assets/Departments/Economic~Development/Why~Nanaimo/CommunityProfile.pdf

This gives us a few extra years to clear up the apparent confusion regarding Nanaimo’s water needs and the means available to meet them.  See Nanaimo’s Water Supply Strategic Plan:

http://www.nanaimo.ca/assets/Departments/Engineering~Public~Works/Water~Supply/WaterSupplyStrategicPlan.pdf

This document likewise uses projections which seriously exaggerate our need to spend millions of dollars quickly to serve our (not so) burgeoning population growth and calls into question the need for an increase in water rates of 5% every year.  It reports that the city has enough water to handle residential development until the year 2071, assuming a growth rate of 1.3%.  In point of fact the growth rate has been less than this at about 1.26%.  And at the same time a number of water saving efficiencies have been introduced.

Why are citizens being given the hustle by our Staff and Council in their continuous battle to gain ever more control over our pocketbooks through taxation?

Disguised as an innocuous committee meeting, the Finance and Policy Committee of the Whole (FPCOW) will meet on Monday, Feb. 6, 2012, in the Board Room at City Hall at 4:30 pm, as it does on most Mondays alternating with regular Council meetings.  This committee is made up of all members of Council and it differs from what is otherwise known as a Council meeting in two distinct areas:  first, no bylaws can be passed in a FPCOW meeting; second it is held in a small board room at City Hall, it is held at a time inconvenient to working  citizens and there are no intruding cameras to record the proceedings.  What can be done at these meetings is approving spending and the notification of Council regarding upcoming project expenditures that may exceed the $250,000 limit set for Staff to manage in accordance with the budget without explicit Council approval.

For example, on Monday Council is asked:

• to approve $30,182 in 2012 Arts, Cultural and Festival Grants;
• to approve $175,988 in 2012 Cultural Operating Grants;
• to provide in principle up to $300,000 toward a $1.8 million project to replace 4 existing barns on the VIEX grounds with a new consolidated barn structure;
• to approve the transfer of $74,500 of the Port Theatre Society’s capital reserve to their 2011 operating deficit;
• to receive the externally completed review of the City’s contracted services  which totaled $31.7 million dollars in 2010.  To read this report see:  http://www.nanaimo.ca/assets/Whats~New/PDFs/ContractedServicesReview2012.pdf
• Notice of issuance of a tender tor traffic signage services for a period of one year with the option to extend the contract for three more years.  This contract was worth $364,000 in 2011;
• Notice that a tender seeking a general contractor for the construction of the Rotary Park Tourist Information Kiosk, Sani-Dump stations and Dog off Leash Park is to be issued and is expected to exceed $250,000;
• Receive a report discussing the City’s grant to the Vancouver Island Symphony which recommends an increase in grant funding of $26, 760;
• Receive a report regarding the issuance of public tender calls for Materials Supply for the Water Treatment Plant and Number one Reservoir which are estimated to be in excess of $3 million dollars;
• Receive a report regarding Contractor Pre-qualification for construction contracts regarding the Water Treatment Plant and Number One Reservoir;
• A presentation regarding a project at 5300 Rutherford Road and a Delegation regarding the same property a review of the environmental monitoring of that same project.

The Agenda for this meeting with considerably more information is available at: http://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2012_Committee_Agendas/FPCOW120206A.pdf

You may agree with me that this Other Council Meeting deserves to come out of the dark and further into our attention.

Council has recently set up a strategic planning steering committee to look at the direction Nanaimowill be going over the next few years.  This in conjunction with the Chamber of Commerce ‘Successful Cities’ initiative as well as a group ‘Vision Nanaimo’; the latter of which held a community meeting prior to the election that drew almost 300 people.  It should be noted that this meeting was not broadly advertized and that the majority of those attending were members of the Chamber, Downtown Nanaimo Business Improvement Association (DNBIA), as well as those individuals, like me, already linked in to city happenings.

A couple of questions; does the City need to do a strategic plan, spending approx. $160,000.00; and could the same not be accomplished through the other two groups at no cost to the City?  Will these three plans somehow be integrated? These questions aside, as this process is moving forward; how much real involvement and input will the broad community have?

As those that paid attention to the election should recall almost every candidate running spoke of broader Community input and consultation.  The basic process for the strategic plan will involve the following components:

• an environmental scan;
• an identification of current commitments from existing plans, reports and
• Council decisions;
• interviews with Council and the management team;
• a staff workshop;
• a survey of members of committees, commissions and boards;
• a Council/senior staff workshop;
• development of a draft strategic plan; and
• an opportunity for the community to respond to the plan draft;

with a follow up, or enhanced component of these components:

• a significant community engagement process to renew the community vision

(including neighbourhood meetings, a youth process, a business symposium

and a survey of community leaders);

• an ongoing Strategic Plan Blog that would seek directed input at key points

and facilitate non-directed discussion;

• interviews with community leaders prior to the Council/senior staff workshop;

and

• Task Teams consisting of staff and related external experts and community

representatives to develop strategies and actions for each identified priority.

On the face of it this all sounds good though from the past ‘community involvement’ simply consisted of Public Open Houses, advertised once or twice in local newspapers and on the city website, where the community would see a number of information boards and be able to give feedback aka. “an opportunity for the community to respond to the plan draft”.  These meetings were generally held once in 3 or 4 locations and tend to have an extremely small turnout from the broad community.

These processes have tended to rely more on specific interest groups, Chamber of Commerce, Economic Development, DNP etc., for feedback and less on the broad community.  It has always been my opinion that rather than ‘Stakeholders’ setting the agenda with community giving feedback on developed plan last it should be the community that sets the agenda first.  Approach the broad community and once we know what the community wants then narrow down the focus and bring in the special interest groups. As drafts are developed then bring back to the broad community.

Will this one be different, seeking more input from the general community, and if so how does the City plan to make it so?

Agenda (Strategic Planning pgs 26/27)

There can be no doubt that this tax exemption bylaw only came forward as a result of our Mayor and some others strong beliefs that the only way to up usage at the convention centre would be to entice someone to build a hotel on land we would be willing to give them behind said centre. Initially in bringing forward the bylaw there was somewhat of an outcry from the Hospitality Association and this latest inception is designed to placate the association and bring them on board with the tax exemption. 

At council’s meeting on January 23^rd these points were approved to be added to the above bylaw:

To include renovations to existing hotels and motels that achieves any one or more of the following:

• adds services

• adds rooms

• improves the quality of the stay for the visiting public;

Also approved was that staff do a report “on the potential for redevelopment of some hotel/motels into nonmarket rent low income housing for the working poor and low income seniors.” As well mention is made that “Council could consider expanding the “downtown” boundaries for revitalization reasons to potentially assist some of the properties currently on the fringes of this boundary.”  This one directly related to Development Cost Charges (DCC’s) and the fact that development within downtown boundaries currently does not pay DCC’s.

The report then goes further in talking about “ways that we, collectively, could mitigate the drop in occupancy through increasing visitors to Nanaimo, particularly if the City attracts a hotel partner.”  There you have it; the main reason for developing the bylaw in the first place, a hotel for the convention centre.

In looking at the above one would initially see the creation of housing for the working poor and low income seniors as a positive and as an advocate for such one would think I am strongly on side with this point.  The fact is that many motels already offer monthly accommodation, though not necessarily affordable at rates of $700.00 and higher.  How I ask would the city propose to ensure the cost to monthly renters if redevelopment is done is affordable, affordable being one of those hugely subjective terms. Also in the event the idea is taken up by current owners there would then be a decrease of low cost temporary accommodation that could see many travel straight throughNanaimoinstead of staying a night or two.

Development cost charges are the means by which the city secures funds to put in the infrastructure needed to support development.  Many years ago, as a means to promote the revitalization of Downtown Nanaimo these costs were waived by the city to promote development.  If these costs are not paid the burden is then put on taxpayers to come up with the costs.  If the Downtown boundary is expanded the costs born by taxpayers can only increase. 

When added together the loss of DCC’s and revenue as a result of the Tax Exemption would be in the millions and have to be born by the taxpayer, this with no guarantee that a hotel for the convention centre would be built anytime soon.  

There is no real, only anecdotal, evidence that a hotel for the convention centre will increase its usage or in any other way, especially with tax breaks, benefit the community.  Currently operating at less than 3% capacity; even with the proposed delegate days for 2012 and 2013,mentioned in the report, capacity would still be less than 5%.  It will take far more than one hotel to bring about any change that would result in the taxpayer subsidizing the facility any less. Yes if it were built it would add to the abundance of underused 4 or 5 star accommodations in the core but at what cost to the community/taxpayer.

The report on the whole is an interesting read and I would encourage folk to check it out.

January 23, 2012 Council Video http://www.nanaimo.ca/CouncilMeetings/VideoArchive.aspx?clip=C120123V 

(Hotel Revitalization Tax Exemption Bylaw 2011 NO. 7143 – pgs 28 – 48) http://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2012_Agendas/C120123A.pdf

During Monday’s (Jan.23, 2012) Council meeting a significant discussion almost took place regarding the expenditure of up to $560,000 for Preliminary Engineering on the South Fork II Dam.  The discussion which almost took place began when Councillor Bestwick asked whether we have examined the alternatives to a very costly dam project which is predicated on a population increase to 100,000 in the next ten years and a total expenditure of some $70 million dollars to meet the resultant water needs. Almost before the issue could be raised, Councillor Brennan called a point of order indicating, as far as I was able to decipher, that Council was no place to discuss such issues: that once in Council, Councillors are to either raise their hand yea, or raise it nay.   This is a pattern with which those of us who view Council are all too familiar.  Again, as far as I was able to tell, the matter of the point of order was never settled, so the principle involved was not made manifest, but the discussion fizzled at this juncture.

The real point to be made here is that if such matters are not to be discussed in Council before the public, when are they supposed to take place and what is the public’s role in such discussions?  Obvious alternatives to spending $70 million on a new dam are to further reduce per capita water use; to limit population growth through land controls, a method often used in tourist communities as we seem to strive to be; or to seek alternative sources.  While I do not represent that no alternatives have been examined, I suggest that the public is not aware that such growth and the path that we are on currently will cost the city more than one year’s total property tax income.  And where do Development Cost Charges (DCCs) fit in?

And most importantly, if Council is not the place for such discussions, then where is the place and when is the time for them?

I end by noting that the land under study in the up to $560,000 is not owned by the City and thus the results of the study could prove to be of little or no use.  I am informed that we could perhaps, under the Water Act, be able to expropriate it at fair market value.  What is that fair market value?  What is it now?  What will it be after the study?  Seems we ought to be looking a few steps ahead.

At its meeting this evening (Jan. 23,2012, 7pm in the Auditorium of the Conference Centre) Council will, among other matters:

“consider amending “REVITALIZATION TAX EXEMPTION BYLAW NO. 7143″ to include renovations to existing hotels and motels that achieves any one or more of the following:

• adds services
• adds rooms
• improves the quality of the stay for the visiting public;”

A great number of questions arise from this this amendment and indeed from the original bylaw (which has not yet been passed).  Many of them revolve around section 7(1) in the bylaw which states that:

“Council may provide a Tax Exemption under this Bylaw to an owner of eligible lands where:

(1) the new construction value, or the demolition and reconstruction value of the Project, as determined based on the building permit(s) issued, must be two million dollars ($2,000,000.00) or greater;”

Questions like these need clarification:

• How are the demolition and reconstruction values as determined by building permit(s) issued calculated?  And how do these relate to assessed value?
• Where does renovation fit in?  Extensive renovations/upgrades can be made which do not add to assessment now or later: i.e. Furniture, bedding, fixtures, etc., which are not part of the structure.  It is not clear whether such items can be counted toward the $2,000,000.. Items which are not permitted in calculating the exemption should be clearly identified.
• What is the anticipated exemption (i.e. the amount by which other property tax payers rates will be raised) based on each $2,000,000 of exemption and remembering that the original hotel was supposed to cost $52,000,000 (the same estimate that was presented as the cost of the VICC)?
• How will the exemption be changed by the annual changes in assessment?  And how do they impact over the 10 year time frame, i.e. are they compounding?
• Why is the $2,000,000 lower limit figure given in the bylaw not shown in the Revitalization Tax Exemption Agreement which will be signed by those requesting the exemption?
• Why is the exemption based on land and improvements rather than improvements alone?
• Why are strata units considered for exemption?

The last scheme in aid of business which Council passed, the VICC, left us with over $3 million in overpayments on our contract with Millennium/Suro/Triarc, and, all-in, several millions per year in operating grants and loan payments.  Can we afford another such decision to provide aid to business, particularly in light of the letter to the City from the President of Nanaimo’s Hospitality Association that clearly states:

“The revenue deterioration that will be experienced by the entire hospitality sector with the addition of a taxpayer-subsidised hotel will be severe.”

I think we all know who will be expected to make up the difference.  This is another scheme with good intentions but without a well-defined business plan and no projections or risk assessment.  Council would be well advised to stop this train wreck before it goes any further and do some proper business planning and risk analysis.  If this were a great idea, we could sell shares in it to our local businesses and investors as was done not so long ago for the Malaspina Hotel and the Arena when capitalism was still in vogue.

I am sure that if you read the bylaw and accompanying documents you will find many other questions which need to be examined before we move ahead with such a bylaw –or not.

The documents can be found in the agenda for tonight’s (Jan 23) meeting on the City’s web site at:

http://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2012_Agendas/C120123A.pdf

pp: 28-48 and 113-126  (As far as I can determine, the docs on 113-126 are the relevant ones for tonights meeting, but this was not clear to me.

Read it and weep.  And then contact your Councillors.

The election that will see our current Council in office until November 2014 was held on November 19, 2011.  All candidates, especially those who were elected, have until March 15, 2012, to file the obligatory campaign finance documents which state the amount of money spent in a campaign and the sources from which that money was obtained.  To date, only four of the nine elected candidates have filed their papers.  See:

http://www.nanaimo.ca/EN/main/departments/Legislative-Services/4609/2011GeneralElection/CamFinDisclose.html

 It is hard to imagine why filing should not be completed quickly , although 120 days from the election is set in the legislation, particularly as this information is to be used in accordance with Section 93 of the Local Government Act:

“Section 93(8) states that “a person who inspects or otherwise accesses a document referred to in subsection (1) under this section must not use the information included in them except for the purposes of the following:

(a)    this Part;

(b)   Division 6 [Conflict of Interest] or Division 7 [Disqualification] of Part 4 of the Community Charter;

(c)    Section 141, 142.1 to 142.3 and 145.92 of the Vancouver Charter.”

The start of a new budget year following an election can be of particular interest in noting any perceived conflicts of interest which might arise linking campaign donations and City budget items or contracts. This information is vital to ensure that doubts concerning the independence of City financial decisions are minimized.  The problem can be particularly acute in an election environment like that in Nanaimo which is basically devoid of individual grass roots campaign contributions and is dominated by corporate and union monies.

Nanaimo has had an unfortunate history of problems with Divisions 6 and 7 which we should try to avoid in future.  The problem can be complicated by votes taken in-camera which may add to the concern that all is not handled in a transparent manner.  Such matters should be avoided by Council and the votes on contracts or budget items should, if not done in public, at least quickly be made public.

As an additional point of darkness, I have been informed that Council’s decision to approve the recent CUPE contract was made in-camera and that the vote is thus secret.  I have enquired how such a money matter can be decided beyond public examination but have yet to get a response.

More on these issues later.