A Banner Council Meeting

Ron Bolin: June 19, 2013

Monday’s was a banner meeting for City Council.  A black banner, I would say.  The issues were important, their treatment trivial and the fractures among Councillors obvious. To give my reasoning on these issues I will provide the text of the delegation comments as well as a brief review of how these topics were treated.

Issue 1:  Water for Upper Lantzville:

Mayor Ruttan and Councillors

You will consider this evening an issue which, to the best of my knowledge has never yet come before the public for discussion, namely: “That Council authorize Staff to finalize a water supply agreement with the District of Lantzville based on the terms outlined in the Staff report.”

The purpose of this recommendation is given as: “To obtain Council approval for the supply of water to Lantzville.”

 The brief and politically unenlightening report on this matter cites a 2005 Memorandum of Understanding (MOU): “Under this MOU the City of Nanaimo agreed in principle to the District of Lantzville’s request for the City to extend its water supply system, at some future point in time, to include Lantzville….In the time since this MOU was signed, the parties have worked extensively to define acceptable terms under which water could be provided to the citizens of Lantzville.”

Certainly as a Citizen of Nanaimo  I am not aware of any extensive work which would lead us to have a reasonable understanding of the impact of such a decision on Nanaimo.  In the past few years Nanaimo ratepayers have put tens of millions of tax dollars into our water system and have seen our water rates increase by many times over that of the cost of living.  Tens of millions more are contemplated for a new source of water. How is it that we can now contemplate providing water to sources outside the City?  We know that Lantzville is not the only local area outside the City with water problems.

I ask that you discuss the purpose of this recommendation openly tonight :  Is it pure charity to an area where a major project recently went bankrupt for lack of water?; Is it that the City will make significant income on selling its water?: Is it the initial move to bring Lantzville to amalgamation with Nanaimo, in which case we would be better off to seek amalgamation first and then supply water; Will we set a precedent that will be difficult to deny when others come calling for Nanaimo water?

I hope that You will express your thoughts on these questions this evening and that Council will either defeat this recommendation or table it until such time as the community has had time to consider it.

___________________________

At the meeting there were some bleatings about the poor folks of Lantzville who need water, but nary a rational discussion of why Nanaimo should supply it any more than for other water hungry locations in our environs or in those desert areas of the world which really, really need it.  Mayor Ruttan, as a resident of Lantzville left the chamber during the discussion and one hopes and trusts that he did the same when the subject came up during rehearsal or at any other time.  The vote was 5 – 3 in favour of supplying Nanaimo water to Lantzville with Bestwick, Kipp and McKay voting against.

Issue 2: The strange case of the City’s Corporate Officer

Mayor Ruttan and Councillors:

While I can have no objection to the appointment this evening of Mr. Ian Howat as a Deputy Corporate Officer, I do wish to understand the person to whom he will be a deputy and the effect of the absence of either the Corporate Officer or a Deputy Corporate Officer on the records of the City and the significance of the absence of any Corporate Officer on City proceedings.

The current holder of the office came to the City and was confirmed as the City’s Corporate Officer on Nov. 29, 2012.  The Corporate Officer under section 148 of the Community Charter is charged with responsibility for corporate administration including, among other things, ensuring accurate minutes of meetings and other business of the Council; of ensuring access to records; certifying City documents; administering oaths and taking affirmations, affidavits and declarations; and other related matters.

The current Corporate Officer has not been in attendance at Council meetings or in performing other required acts for the last three months.  During this time the Office has been served by Deputy Corporate Officers, at least until recently.  We have had both Mr. Holmes and Mr. Clemens designated as Corporate Officers.  Mr. Holmes has since left the City, albeit that notice of his removal as a DCO has not been promulgated, and Mr. Clemens has been missing for some meetings such as those for which minutes have been presented in the current agenda.  Nor were Ms. Samra, Mr. Holmes or Mr. Clemens in attendance at last week’s Council meeting.

I would appreciate knowing the status of such matters as are in the purview of the Corporate Officer or her/his deputies in the absence of any of the above and hope this will be discussed as Mr. Howat’s approval procedure moves ahead.

Questions regarding the Corporate Officer, who is in charge of many critical functions and is an Officer demanded by the Community Charter, were talked around.  Later in question period it became clear that the function was held lightly and that further, the City Manager saw no difficulty in doing without a Corporate Officer when it was convenient to do so.  While he did not respond directly to a question from someone other than myself if the Corporate Officer was being paid while on leave, his response indicated to me that the incumbent was being paid to stay away.  This is not a cheap position and three months’ pay and climbing is not to be dismissed lightly.  In the end Mr. Howats appointment was passed by a vote of 6-3. It is the matter of the Corporate Officer and her/his duties which I feel are being neglected.  I have no particular problem with Mr. Howats appointment.

Issue 3: The budget Process:

Various Councillors have, from time to time, brought forward ideas concerning the role which Council should play in the development of the budget and financial plan.  Some opt for a leadership role in setting goals for this process, while other are content to ask citizens to come up with some cuts. With this item Staff offered Council some alternatives along with a suggested process for preparing the 2014-2018 financial plan.

At its June 10 meeting, Staff, in the face of a similar request from Councillor Kipp, will bring forward a proposal:  “To get Council’s direction on the preparation and review of the 2014- 2018 Financial Plan.”

The Staff report notes that:

“The financial plan is a large and extremely complex document. There is only a handful of Staff who fully understands the document in its entirety, and digesting all of the details can be very daunting for someone who doesn’t work with it virtually full-time.  It is unrealistic to expect that Council members will be 100% conversant with all aspects the budget. However, Council does need to be confident that the financial plan reflects the vision that Council has for the community.”

Amen to that!  There is a further need to ensure that citizens are confident that the financial plan reflects their vision –and their ability to pay.  While part of the reason why both citizens and Council are less than 100% conversant with the budget arises from the complex manner in which it is presented, a significant part of the process is ignored:  understanding basic priorities.

Each of us must define certain facts and estimates about our household operations:  What income do we expect and how much of it is certain; what savings do we have which can be called upon if need be; how much do we owe and how much more might we able to borrow if necessary, and last but not least, what are our known and anticipated expenses.

It is in the matter of expenses that this process is most daunting:  Income is income, savings are savings and debt is debt.  But expenses, though more under our immediate control, are more insidious in the day in, day out, year in, year out stress which they place on our emotions.  A budget is designed to set some limits on our emotions.  Before a rational budgeting process can begin, it is required that we differentiate our expenditures into what is necessary and can only be cut if we are prepared to contemplate bankruptcy, and what non necessities ( niceties, if you will) can be cut without threatening our  vitality or added without unbalancing our economy.

While there may be differences about what is a necessity and what is desired, without defining these terms, there is no basis for any rational budget discussion.  What is clear however, is that things which once were discretionary have a way of becoming necessary and that what is desired has a similar habit of taking on the guise of a necessity.  These reasons demand periodic reviews.

In its report Staff outlines three budget options for Council:

  1. Direct service level cuts or increases;
  2. The status quo; or
  3. The budget target with a “cutback list.

These approaches neither command Council’s responsibility in determining the hierarchy of needs in our community ranging from mandatory to frivolous nor how, proportionally, our scarce resources are to be allocated along this spectrum.  Neither does it demand management ability from Staff in then operationalizing those policy statements.  To my way of thinking both areas of responsibility nave been misallocated: Council’s as it becomes embroiled in operational details, and Staff’s by laying off implementation plans on Council.

There have been several attempts to implement a “Core Review” or a “Zero Based Budget Process” which raise questions, not only about the money, but about its meaning and use.  Councillors who have continually asked for a “Core Review” are correct about where a budget process can begin.  The question is, at base, should Council “Set” a budget which is then to be implemented by Staff, or are they there to “Review” a budget set by Staff.  While recognizing that a fine line is involved, in my opinion these two methodologies must periodically be interchanged and it is time for Council take the lead in the budget dance.

To their credit, in recent years Staff has introduced tools which, if properly developed and maintained, can be used to make the financial plan easier to understand, if not easier to fund, for both Council and citizens.  Among these is the Balanced Score Card which attempts to set standards and measures for performance in city activities which can then be balanced with expenditures in those areas thus allowing a comparison of expenses to results.  See:

http://www.nanaimo.ca/PerformanceMeasurement/BalancedScorecard

Beyond this document is the City’s late to the table but better late than never Asset Management Plan.  Asset management has become the financial equivalent of sonar in sounding out the perils which lie below the surface of our budgetary and financial plans.  It looks at the costs of maintaining our already municipally owned assets such as water and sewer lines, roads, buildings, parks, vehicles, computers, etc.  These costs, once aggregated, can be daunting.  The City currently owns and operates assets of over $2.2 billion (with a “b”) dollars.  Like all assets, including those of our own homes, these need periodic maintenance or, in the end, replacement –fortunately not all at the same time.  The first of the following documents lays out the bones of the problem as it relates to Nanaimo while the second, update document, puts some dollar cost flesh on those bones.

http://www.nanaimo.ca/assets/Departments/Engineering~Public~Works/Asset_Management_Plan.pdf

http://www.nanaimo.ca/assets/Departments/Engineering~Public~Works/2012AssetManagementUpdate.pdf

It has not been apparent to me that these documents were extensively used in the development of, or discussions about, the 2013 budget and the 2013-2017 Financial Plan, further than to add a 1% per year property tax increase for Asset Management in each of the next five years.

It is to be hoped that these measures will be more fully developed and maintained during the 2014 process which hopefully will be undertaken along with a core review or zero base budget process and can be completed, unlike the 2013 budget, before the next year’s spending begins.

It is fervently to be hoped that Council and Staff can reach a budget and financial plan process that will recognize that a budget is more than just a set of numbers which add up, but also a set of numbers that represent the needs as well as the desires of a community in a measured and unambiguous way.

After some minutes of some heated and pointed discussion Staff’s recommendation, which in my mind equates to more of the same as Council has done every year, i.e. virtually nothing, was surprisingly passed unanimously.  I have started to prepare a methodology base on the program descriptions and measures which can be found in the City’s 2012 Annual Municipal Report which was also approved on Monday.

Other Stuff:

The City’s Statement of Financial Information (SOFI) for 2012 was also presented.  It contains the salaries and expenses of Council as well as the salaries of all City employees making more than $75,000 (not including benefits) all external contractors who were paid over $25,000 and well as the amounts over $25,000 given out for grants and contributions, i.e. discretionary funding given by Council.  This latter is an interesting list in that it does not include another $5 million which is attributed to two companies which are owned and operated by the City , NEDC and PONC (Nanaimo Economic Development Corporation and the Port of Nanaimo Centre, i.e. the conference centre) and are supposedly at arm’s length, but reside in the budget of the Strategic Relationships Department.  Nor does it include the various tax exemptions which have been handed out to churches and businesses.  All in all Council’s discretionary spending adds up to a very tidy sum.  The SOFI document can be found here:

http://www.nanaimo.ca/assets/Departments/Finance/Budget~and~Financial~Reports/Financial~Reports/2012%20Statement%20Of%20Financial%20Information.pdf

The Shaw Go WiFi proposal was ably spoken against by Christal Martin and in the end it was defeated, much to the relief of the electrosensitive in town and, one supposes, the disappointment of Shaw which anticipated a captive market.

All in all it was another evening of disappointments with a Council which appears to be so divided that rational discussion on any important matter seems to be impossible.

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