Council tasted the Frosting and mostly liked it. When do they discuss the Cake?

Ron Bolin: March 8, 2014

On Wednesday and Thursday of this week, Council spent some six hours each day trying out the taste of some 400+ varieties of frosting with which the cake of the 2014 budget is to be covered.  These items represent the additions of tasks above and beyond those of the cake, i.e. the budget necessities which Staff seems to believe are either already committed or preordained.  While a final concordance of the frosted items should soon be released, it seems that there were some alterations as projects or hirings were modified or postponed to a later period.  I could not be present for the entire event and as there is no audio or video record of these “Special Council Meetings”, the final tally must await public release.  The original table of these frosting factors was contained in the meeting agenda which can be found on the City’s web site.]

https://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2014_Committee_Agendas/SOCOW140305A.pdf

In general the items could be placed into four descriptive categories: New, Upgrades, Asset Management (maintenance) or Base Service Level Increases.  They could also be categorized by Department, Project, or recommended year(s) of expenditures.  If this information were available digitally, the recommendations could be examined from various perspectives, but my request for digital information was denied.  More about this later.

Councillor Pattje early started the meeting by suggesting  that a tax increase of 2.2% be chosen without going over matters item by item.  Staff responded that 2.2% would approve items 1 through 364 on the list and that if all items were approved as presented this would bring the 2014 tax increase to 2.8%, with subsequent years (2015-2018) set at 6.1%,3.1%,8.1% and 1.6%. This motion was defeated.  Following some hard slogging Councillor Kipp noted that dealing with some 400+ items at this level of detail smacked very much of micro-management….but the ordeal continued to the bitter end.  The final result of the few cuts, additions and time shifts made remain to be seen in a final report from Staff.

Having spent most of the time looking at the circa 411 individual items on the 2014-2018 Decision Package list, let’s now take an overview.  2014 budget expenditures are shown as starting at a pre-commitment position of items which have already been approved or are works-in-progress of $38,133,463 before the add-ons that were discussed. These allocations were not itemized.   A couple of questions concerning the 2014 part of the package remain in my mind: costs associated with the Colliery Dams are not shown, even though it is known that some $7 million was originally allocated for this purpose.  The costliest proposal in the Decision Package for 2014 by far was the construction of a new fire hall for an estimated $2.4 million, which would be followed by an even costlier need for the personnel to man it.  It is my understanding that this item was postponed to a later year.

Further, in each year from 2014 to 2018 an allocation to an asset management (maintenance) fund of 1% of total property tax revenues has been recommended and accepted.  This amount, as it compounds, starts at $907,601 in 2014 and increases to $5,001,968 in 2018 for a total of $14,561,630 over this period.  It may be recalled that this practice was established during the last budget cycle and therefore that today’s 1% actually amounts in 2014 to 2% of the 2013 allocation, etc.  This mechanism should allow Nanaimo to gradually crawl out from under the serious deficiency in funds needed to maintain the assets which the City already has, not to mention those pricy additions which are either in progress or are proposed, but will put increasing pressure on discretionary spending.   Following is an extract from the March 5 agenda for the Special Meeting of Council which opened the two day discussion and includes the entire Decision package table from that event:  This agenda also contains the entire table of Decision packages discussed and a brief description of the cake.

https://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2014_Committee_Agendas/SOCOW140305A.pdf

“In order to meet deadlines for tendering projects and to meet operational staffing needs, Council was asked to provide early approval of a number of expenditures. This was done at the meeting on 2014-JAN-22, with one additional purchase being approved at the meeting on 2014-JAN-30.

Staff do not propose to have any further discussion on the base operating budget unless Council wishes to discuss reducing or increasing service levels. The base may be adjusted if new information is received that would impact revenue or cost assumptions, such as a revised estimate of new construction revenue.

The base budget tor 2014 that is funded from property taxation (excluding the Vancouver Island Regional Library) is approximately $78.3 million, down about $1. 3 million (1.7%) from 2013. This is largely due to the reduction in the number of management staff as part of the recent reorganization. Adding the Library and the tax impact of the early approval projects brings the total to $84.0 million. If no further decision packages are approved for 2014, there would be a 6.1 % property tax decrease.

However, not approving any further decision packages would have serious consequences for the City. By far the majority of projects funded from taxation (and water and sewer user fees) are for the maintenance and renewal of City infrastructure. Reducing funding for these asset management projects can impact service levels and increase maintenance costs. New projects are generally funded from other sources, such as Development Cost Charges. Although they may not have an immediate impact on taxes, there is a long term impact for maintenance and replacement. Some projects also have a more immediate increase in operating cost; e.g., the capital cost of constructing a new fire station is smaller than the cost of staffing and operating the station.”

Note that the only reference to the cake onto which this frosting was to be spread is reference relative to other Special Council meetings in January.

This entire package is baked into the cake and was not up for discussion, apparently due to prior acceptance by Council.  The Agenda of Jan. 22, mentioned above which includes pre-approval of some $11,763,764 of projects can be found at:

https://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2014_Committee_Agendas/SOCOW140122A.pdf

The minutes of that meeting show that the motion to approve was unanimous.

The Special Council meeting of Jan. 30 referred to above apparently added a “crane truck” to the pre-approved 2014 budget but I could not find an estimated cost for this addition.  The agenda for that meeting can be found at:

https://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/2014_Committee_Agendas/SOCOW140130A.pdf

As of this date, no minutes are shown for this meeting.

A revelation of the $7,363,628 in wholly discretionary grants and tax exemptions for 2013 which appear to be baked into the cake can be found at:

https://www.nanaimo.ca/UploadedFilesPath/Site_Structure/Corporate_Services/Corporate_Administration/Presentations/SOCOW140305PGrants_and_Exemptions_Presentation.pdf

A request for the digital data on Grants and Exemptions which was handed out and which showed all recipients and the amounts which they received was refused.  It is summarized in the presentation indicated above, but this data would be most useful in slicing and dicing these discretionary gifts to various agencies and the services which they provide, whether by way of culture, sport, community, miscellaneous, travel, social service, operating, volunteer fire, etc. if the data were provided to Council and the public in a convenient format.  It is possible, after all, to scan or re-enter this data from paper handouts, but it is a needless hardship which can only be interpreted as either callous or representative of a questionable conscience.

In view of all the protestations of their earnest desire for increased transparency which were made by candidates during the last election, it should be noted that the many “Special” Council meetings which have taken place on the budget have been set for early mornings on work days in a relatively small board room well out of the way of any prying cameras or microphones which could allow the public to understand the proceedings or the positions which various Councillors have made on various budget items.

As a wrap up of this topic (notwithstanding the correction of any errors presented her or the addition of supplementary material), I do wish, despite some criticisms, to thank Staff and Council for this effort.  I am sure that it has proved to be a learning experience for all involved and the next time around, which will be with a new Council next year, will be even better.  In the meantime this year, I still look forward to an explicit discussion of the cake, rather than having to try to deduce it from the shape of the frosting.

P.S.:

I must mention that in requesting these data tables in digital form,  I was told that in all the years of these budget hearings, I was the only one who requested such data.  I am not sure what to make of this as I am quite aware that there a many out in ratepayer land who are as interested as I am in the public data which has been prepared by public funding and for which there appears to be no excuse for not making that data available in digital form.  This entire issue is in serious need of prompt attention as the study on the reorganization of the City’s web site is currently proceeding.  And to go with this we are in even more serious need of a public information policy.  As it stands, the City’s policy on Information is as follows in our Records Management Procedures Bylaw, See:

http://www.nanaimo.ca/UploadedFilesPath/Bylaws/B7150.pdf

Which cryptically states that: ”The records management system currently used by the city is authorized” while in no way describing this system.”  This, in a city as large and complex as Nanaimo, is a serious travesty.

If you want to see this change, call and write your Councillors about making information paid for by the public available to the public in a form which permits the data to used efficiently by those who have paid the bills for it.  Also please feel free to comment here….

PPS: The top recipients of grants and exemptions are:

 

2013 Grants and Exemptions ; Top 20, ie. >$50,000
Port Theatre Society  $  1,961,857.35
Nanaimo Economic Dev Corp  $  1,389,612.08
Nanaimo Museum Society  $      653,834.25
McGirr Sports Society  $      457,029.20
Nature Trust of BC  $      161,451.04
Nanaimo Recycling Exchange  $      129,479.20
Nan. Sen. Cit. Housing Dev Soc  $      115,436.50
DNBIA  $      115,101.71
Pacifica Housing Advisory Assc.  $      101,277.12
Good Samaritan Canada  $        98,616.63
 CVI Centre for the ARTS  $        93,399.95
VI Symphony  $        88,157.75
VI Raiders Football Club  $        87,095.00
Nanaimo Art Gallery  $        71,987.47
Nanaimo Affordable Housing  $        65,239.84
United Way C &N VI  $        63,279.31
Loaves and Fishes  $        63,034.15
Nanaio Community Archives  $        61,204.07
First Unitarian Fellowship  $        58,958.00
BC SPCA  $        51,190.53
 $  5,887,241.15
Total G&E  $  7,363,628.46
Top 20 as a percent of total 80
Top  2 as a percent of total 46
dollars per capita annual cost  $              84.64
dollars per household annual cost  $            228.53
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