City of Vancouver

1
City of Vancouver

• 2004 Operating Budget
• Interim Estimates
• March 9, 2004

2
City Choices 2004 Newspaper Flyer
140,000 copies distributed

• Local Newspapers
• Civic Facilities
• City Website

• Questionnaire
• 749 responses
• self selecting
• Results distributed to Council

3
Newspaper Flyer - Results

• Service Areas to Protect
• Police, Fire, Streets Traffic, Libraries,
  Other Public Safety
• Service Areas to Reduce
• Legislative, Cultural, Support, and Planning
  Development
• Preference to Balance the Budget
• Equal distribution between tax increase, service
  cut combination slightly greater preference
  for service cuts

4
Newspaper Flyer Results (contd)

• Support for Tax Increase overall not as high as
  Telephone Survey
• 36 - 2 tax increase
• 16 - 4 tax increase
• 26 - 6 tax increase

Demographics for City Choices Significantly
Different than Telephone Survey older own
property
5
Mayors Forums

• Based Mayors Forums held in January
• Neighbourhood Livability and Safety

February 11, 2004 Mount Pleasant Community
Centre
February 14, 2004 West End Community Centre
Theme Poverty, Homelessness Provincial
Offloading
Theme Crime and Safety

• Results from the Mayors Forum distributed to
  Council

6
Mayors Forums - Results

• Pilot Integrated Service Delivery Model
• 2 Pilots - coordinated approach at the community
  level
• include other levels of government
• tackle issues like homelessness property crime
• General Support
• Staff to Report on Pilot estimated annual cost
  200K-250K

7
Mayors Forums Results (contd)

• Additional Police Services
• Short Term bring to authorized levels 1,124
  officers
• Long Term increase authorized levels beyond
  1,124
• Support - restoring sworn officers to authorized
  levels
• Current budget provides for 90 recruits and 18
  officers to be contracted back by year end at
  authorized strength
• Mixed Support - increasing sworn strength
• West End vs. Mount Pleasant
• Addressing social issues reduces need for
  additional policing
• Desire for additional police officers on the
  street
• Staff to Report Back VPD Long-Range Strategic
  Plan

8
Mayors Forums Results (Contd)

• Social Sustainability
• What actions should the City Council take to meet
  social sustainability needs in the City?
• Need to address homelessness issues support four
  pillars approach develop four pillars to tackle
  the issue of mental illness
• Budget
• How should Council balance the budget?
• Support increased taxes rather than a reduction
  in programs

9
City Choices 2004 Conclusions

• Telephone Survey Mayors Forum
• support increased property taxes to maintain
  service levels
• Social issues - increased importance to residents
• Continued support for policing - at the street
  level

10
2004 Operating Budget- Options to Balance
-Steps to Get to 2
11
Step 1 Detailed Budget Review
Budget Impact Tax
million Impact

• Revenue Adjustments
• On-Street Parking 0.9 0.2
• Licence Fees 1.1 0.3
• Property Taxes 4.8 1.2
• Interest Short Term Sinking Fund (2.4) (0.6)
• Miscellaneous 1.0 0.2
• Total Increase 5.5 1.3

• Expenditure Adjustments
• Debt Charges 3.3 0.8
• Contracting Back Police Officers (1.1) (0.3)
• Cost Recovered Expenditures (1.0) (0.2)
• (Parking 4am Bar Closure)
• Misc. Adjustments 0.8 0.2
• Total Decrease 2.1 0.5
• Net Decrease 7.5 1.8

12
Step 1 - Detailed Budget Review

• Preliminary Estimate 21.9 million 5.26 Tax
  Increase
• Net Decrease ( 7.5 million) (1.81)
• Interim Estimate 14.4 million 3.45 Tax
  Increase

RECOMMENDATION B(i) Maintain Service Levels
13
City vs. Outside Agency Costs

• Total Potential Tax Increase 3.45
• City Costs 2.97
• 0.88 Capital from Revenue
• 0.72 Interest Sinking Fund
• 0.48 New Programs Approved in 2003
• 0.89 Base Increases Inflation/Revenues
• Outside Agencies 0.48
• 0.10 Regional Sewer Costs
• 0.14 E-Comm
• 0.19 Tax Exemption Port Berth Corridors
• 0.05 Port Policing

14
Step 2 Corporate Adjustments
Budget Impact Tax
million Impact

• Reduce New and Non-Recurring Budget 0.75 0.18
• Reduce Corporate Training 0.20 0.05
• Reduce Strategic Initiatives Fund 0.75 0.18
• Increase Vacancy Savings/Turnover 0.50 0.12
• Department Efficiencies 1.00 0.24
• Total Corporate Adjustments 3.20 0.77

15
Step 2 Corporate Adjustments (contd)

• No impact on direct services or positions
• 1 million efficiency allocation on-going
  reduction
• Other 2.2 million of adjustments re-budgeted
  in 2005
• impact on taxes of 0.5 in 2005

Recommendation B (ii) Property Tax Reduced
from 3.45 to 2.68 (2.20 City Costs 0.48
Outside Agency Costs) Recommended by City
Manager and Director of Finance Outside Agency
Cost Increases Passed Through No Impact on Direct
Services
16
Step 3 Options to Reach 2
Budget Impact Tax
million Impact

• Departmental Adjustments
• Group 1 0.86 0.21
• Group 2 1.36 0.33
• Group 3 2.48 0.59
• Deferral of Capital 1.00 0.24
• Further Deferral of Capital 1.00 0.24
• Increase Transfer from PEF 1.00 0.24
• Total Step 3 Adjustments 7.70 1.85

Note Only Require 2.8 million to reduce
property tax from 2.68 to 2
17
Step 3 Options to Reach 2 (contd)

• - Impact On Direct Services -
• Department Adjustments
• Group 1 - 0.86 million
• Minor impact on services
• No staffing Impact (1 vacant position)
• Group 2 - 1.36 million
• More significant impact on services levels (e.g.
  Anti-Graffiti, Central Library Hours, Tree
  By-Law)
• 18.8 staffing positions
• Group 3 - 2.48 million
• Significant impact on service levels (e.g.
  Support Services, Police, Fire)
• 27.1 staffing positions

18
Step 3 Options to Reach 2 (contd)

• - Impact On Direct Services -
• Capital Deferral
• Council Deferred 2 million in 2003-1 million
  included in 2004
• 2 optional deferrals of 1 million each
• Need to re-budget in 2005 or seek new funding
  sources
• Partnership, GST,
• Transfer from PEF
• Reduces ability to meet strategic objectives
• Increases Operating Budget reliance on PEF

Recommendation B (iii) Choose 2.8 million
from the options to provide a property tax
increase of 2
19
Step 3 Options to Reach 2 (contd)

• - Impact On Direct Services -

• To reduce property taxes below 2.68 - City
  Manager and Director of Finance Recommend
• 1st order Group 1 Adjustments 0.21 reduction
  
• 2.47 Property Tax Increase (1.99 City Costs)
• 2nd order Deferral from Capital 0.24
  reduction
• 2.23 Property Tax Increase (1.75 City Costs)
• Do not recommend further cuts
• impacts Services Reducing City Services to Pay
  for Cost of
• Outside Agencies (0.48) of which Council has
  no control

20
2004 Initiatives
2004 2005 million million

• Included in Preliminary Budget 2.3 2.8
• Reported to Council and Referred to
  Budget 0.7 0.8
• Identified After Preliminary Budget 0.8 1.0
• Total Initiatives 3.8 4.6

• City Manager and Director of Finance Recommend
• All initiatives be funded by Contingency Reserve
  
• - Council Approval Required -
• Priorities may shift and scope of initiatives
  may change
• Not all will go forward or be approved by
  Council
• Delays Impact to 2005

21
2004 Initiatives (contd)

• Priority Initiatives
• Systems Analyst (Recommendation C)
• Process Reviews/Shared Services
• No Additional Cost
• Communications Positions (Recommendation D)
• Assistant Director of Communications
• Graphics Project Assistant
• 2004 Cost 106,250 On-Going 123,000
• Funded from Contingency Reserve

22
2004 Initiatives (contd)

• Reported to Council and Referred to Budget
• Approval sought for VEDC (Recommendation E)
• urgency in renewing contract
• funded provided for in 2004 Operating Budget
• Deferred to CSB March 11, 2004 (Recommendation
  F)
• Pesticide Use on Private Property
• Vancouver Fire and Rescue Services Staffing
  Request
• Carnegie Outreach Program
• Just and Sustainable Food System
• Vancouver City Planning Commission
• funded from Contingency Reserve

23
Vancouver Police Initiatives

• Long Term Staffing Needs
• Department preparing long-term strategic plan
• Lead to increase in civilian and sworn staffing
  over five years
• Mayors Forum asked participants if they
  supported an increase in sworn staffing
• Received Mixed Support
• Support increased policing at the street or
  community level

24
Vancouver Police Initiatives (contd)
Long Term Staffing Needs

• Consideration I
• City Manager and Director of Finance Recommend
• Council and Board commission an independent
  review of the
• departments long-term strategic plan
• Include opportunity for process reviews
• Ensure impact on budget in the long-term is
  minimized

25
New Revenues/Savings

• Increase GST Rebate Cost Savings
• Requires Federal legislative amendment
• Retroactive February 1st
• Based on 2003 Actual Expenditures - 5.7 million
  Savings
• 2.4 million savings Operating
• 3.3 million savings Capital
• May place limitations on the use of captured
  savings

Recommendation G City Manager and Director of
Finance Recommend Due to uncertainty-do not to
include in budget-report back to Council
26
New Revenues/Savings (contd)

• Gaming Revenue Additional Revenues
• City receives 10 of gaming revenue
• January 2004, Council approved slots at Plaza of
  Nations
• Additional revenue - 8 million annually
• Uncertainty timing of Plaza of Nations opening
  revenues

Recommendation G City Manager and Director of
Finance Recommend Due to uncertainty-do not to
include in budget-report back to Council
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Impact on 2005
2005 Tax million Impact

• Departmental Initiatives 4.5 1.1
• ISPOT (now deferred to 2005) 1.0 0.2
• Corporate One-Time Adjustments 2.2 0.5
• Total Impact on 2005 7.7 1.8
• Need to Prioritize Initiatives
• In Relation to Existing Services

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Property Tax Impacts
2.0 Tax Increase 2.0 Tax Increase 2.68 Tax Increase 2.68 Tax Increase
Value Taxes Annual Change Taxes Annual Change
Residential Average Property 433,145 Residential Average Property 433,145 Residential Average Property 433,145 Residential Average Property 433,145 Residential Average Property 433,145 Residential Average Property 433,145
General Taxes 1,235 30 1,243 39
Utilities 591 21 591 21
Total 1,826 51 1,834 60

Business Business Business Business Business Business
for each 100,000,000 16,478 386 16,588 496
29
Municipal Tax Increases (Mar.8/04)
All Estimates Except which have been approved
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Recommendations

• A. approve Parks global budget prior to
  adjustments
• B (i) approve the operating budget with a 3.45
  tax increase or
• B (ii) approve adjustments to bring in an
  operating budget with a 2.68 tax increase or
• B (iii) approve adjustments to bring in an
  operating budget below 2.68 tax increase
• Department Adjustments - Group 1 0.86 0.21
• Department Adjustments - Group 2 1.36 0.33
• Department Adjustments - Group 3 2.48 0.59
• Deferral of Capital 1.00 0.24
• Further Deferral of Capital 1.00 0.24
• Increase Transfer from PEF 1.00 0.24

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Recommendations

• C. approve creation of Systems Analyst position
  no funding required
• D. approve creation of two Communications
  Position funded from Contingency Reserve
• E. approve renewal of VEDC Contract at 587,000
  no funding required
• F. approve deferral of programs referred to 2004
  Operating Budget to CSB on March 11, 2004
• G. instruct staff to report back on GST Rebate
  Gaming Revenue

32
For Consideration

• H. No longer applicable
• I. approve, in consultation with the Police
  Board, an independent review of the VPDs long
  range strategic plan, including an evaluation of
  process improvements

33
City Manager Director of Finance
Recommendations

• Recommend B(ii)
• Tax Increase of 2.68 (2.20 City Costs)
• If Lower than 2.68
• 1st - Group 1 Department Adjustments (2.47)
• 2nd - Defer Capital from Revenue (2.23)
• 3rd - No more adjustments

34
City Manager Director of Finance
Recommendations (Contd)

• Initiatives funded from Contingency Reserve
• still require Council approval
• Approve priority initiatives
• Systems Analyst, Communications, VEDC
• Defer Reports Referred to 2004 Budget to CSB on
  March 11, 2004

35
City Manager Director of Finance
Recommendations (Contd)

• Defer ISPOT (done)
• Independent Review of VPD Long-Range Strategic
  Plan
• Report back on GST Gaming Revenues

36
QUESTIONS PERIOD