Budget Committee Requests Capital Project Report
Despite lots of planning and prioritizing capitals projects for Budget 2019 a few hiccups have popped up and it had the City's Engineer asking for a revision in the final plan. And Budget Committee asking for a detailed report as to why and the effects of agreeing in favour of the request.
At Monday's Budget Committee meeting City Engineer Josh Mickelborough asked Council to make $1.6 million worth of changes in the infrastructure capital budget in an effort to better serve the community.
The Engineering Department had selected capital projects according to a priority based budgeting formula with a projected two to four percent property tax increase scenario.
Mickelborough told the committee the projects initially decided upon was “done in haste” and after a re-evaluation a correction to the capital budget was needed to ensure higher priority work is completed this year. The projects had initially been selected from the highest scoring from the highest to the lowest to hit the tax increase, he said.
Engineering is asking to remove $23,000 for community aesthetics, $620,000 for pavement levelling, $14,000 curb and median replacement, $300,000 for deep patching, $104,100 for lanes and gravel roads, $430,000 for ultra thin overlay, $14,300 for slab slicing and reduce micro-surfacing by $94,600.
The $1.6 million saved by the reductions would then be re-directed and spent as following if approved: $550,000 paving, $400,000 traffic control and $650,000 for structure (bridge) upgrades.
Speaking as part of the hour long debate at Budget Committee City Manager Jim Puffalt said he did not support removing $23,000 for community aesthetics or spending additional funds for traffic control measures in 2019. Community aesthetics would be repairing damage done to boulevards by equipment to city boulevards over the years.
Puffalt said he did not support removing community aesthetics because “we do get complaints (about it).”
In the report to Budget Committee community aesthetics had the second lowest (total) project score of 43.6 with a risk score of 4 for a total project score of 174.4 and a cost to benefit ratio of 0.72. The only project scoring lower was Municipal Airport Improvements which had a score of 35 a risk score of 2 for a total project score of 70 and a cost to benefit ratio of 1.29.
The highest scoring capital project (based upon total project score) was paved roadway reconstruction with a community outcome score of 56.2 a risk score of 20 for a total project score of 1124 and a cost to benefit ratio of 3.96.
Councillor Chris Warren expressed concerns about the effects of cancelling certain capital projects completely and asked if it was not possible to complete at least some of that work. He asked about perhaps spending $200,000 on pavement as an example and what would be the result.
“You don’t know what the implications are...these are all important projects (being eliminated),” Councillor Warren stated.
Mickelborough stated the projects were eliminated due to their score in the Priority Based Budget process. According to a report before the Committee the projects were selected based upon a Community Outcome Score multiplied by the Risk Score and the Cost Ratio Benefit by completing the project.
“We would like to see the $1.6 million re-invested but these are the ones we can live through,” he said.
Councillor Warren re-stated his concerns about making the decision.
“It is extremely difficult to be up here and pick and choose where to make the cuts,” he said, adding “all the work is required it’s just a matter of allocating the right amount of dollars to it.”
Mickelborough stated Engineering was moving some of capital project money as there was a major bridge refurbishment to complete.
Councillor Brian Swanson took a more aggressive approach to the issue.
“I take Community Outcome Scores with a grain of salt,” Councillor Swanson stated.
He expressed the opinion the reservoir construction project as one possibility for a reduction in the capital budget.
Councillor Dawn Luhning expressed concerns about the entire process and making decisions on cuts should be much more straight forward and Budget Committee should not be picking and chosing line by line what to cut or approve.
“To be honest as a Councillor you (Administration) are the experts as what needs to be done and we should be able to say cut four percent from this department,” Councillor Luhning stated, adding “I reiterate how frustrating for me (this is). We do the same thing over and over again for me this is insanity “
Finance Director Brian Acker spoke about the budget targets Council had indicated during the Budget formulation process.
‘It is important to go back to those targets of two to four percent and balance that capital budget,” Acker stated.
“(We are) not asking for any additional monies and no change is necessary if you don’t want to adopt what the engineer has recommended..in the end it is Council’s decision.”
Puffalt said deferred projects cannot be eliminated forever but Administration did not want to carry forward $7 million of work which may not be completed.
He spoke about the urgency of getting tenders out as soon as possible for capital projects.
“Budgets and tender times are January and February...and not going to construction companies and say can you squeeze this in and then you are paying a premium.”
“We must act with some haste to get the budget done.”
Councillor Swanson said he agreed with the City Manager and tenders should have been issued two months ago. He went on to call for a doubling of cast iron water main replacement as it would decrease the time until the effect of reduced water main repairs impacted the City's bottom line.
Swanson then proposed removing what he said was a proposed new water reservoir completely from the capital budget (moving it to 2022) and replace it with a $100,000 community education plan on what to do in the event of a catastrophic water utility failure.
“We cannot afford to do it all at once. We just cannot afford all of these things,” justifying deferring work because “there is serious trouble out there in terms of our economy.”
“We have to reduce expenditures and focus on critical core aspects.”
At this point Puffalt said a report to Council might be appropriate.
“Rather than making a snap decision without get the detailed background.”
Councillor Scott McMann also stated frustration in the process.
“At some point we need to see what needs to get fixed this year and the next year and the next year and the year after...we keep getting these reports and we don’t have the status on this,” McMann said.
Mayor Frasier Tolmie said he did not oppose Councillor Swanson's concerns regarding reservoir funding.
Councillor Crystal Froese said she saw the value in educating the public what needed to be done in the event of a catastrophic water failure.
“As we saw with SaskPower (recent disruption) we saw what kind of chaos that caused.”
Councillor Heather Eby supported a report coming to Budget Committee.
“We do not know what we are removing from the Budget. But we need a report to back up what we are doing,” Councillor Eby said.
“There needs to be a re-evaluation on our long term decisions…but it is extremely difficult to make a decision,” Councillor Warren stated.
In the end Budget Committee voted 6-1 – with Councillor Swanson opposed – to have Administration prepare a report into the consequences and ramifications of removing items from the Five Year Capital Budget. The report is expected for the January 21st Budget Committee meeting.