Agenda Index City of Vancouver



Vancouver City Council


Corporate Management Team
in consultation with the Capital Plan Staff Review Group


2003 - 2005 Capital Plan Draft Allocation





The City of Vancouver has a policy to plan for capital expenditures on a multi-year cycle. In recent years, capital plans have been developed in three year terms in order to match the term of Council and allowing for a borrowing plebiscite to be held in conjunction with civic election.

Capital Plans are normally funded from a combination of sources including, borrowingapproved by plebiscite, borrowing authority approved by Council for sewer and water purposes, the annual operating budget and from contributions from third parties.

The Vancouver Charter, Section 242 provides that Council may approve the borrowing of funds for water and sewer purposes without the assent of voters. Borrowing for other purposes requires voter approval through a borrowing plebiscite.


The purpose of this report is to present the staff recommendations regarding 2003-2005 Capital Plan project priorities to Council for their consideration and to recommend that the draft plan be referred to the public for comment.


The City plans its capital expenditure program on a long term basis, often many years into the future. To make these plans manageable and to provide the opportunity for borrowing authorities to be sought from the public, these long range plans are formalized into three year Capital Plans. On January 22, 2002, Council received a presentation from the Corporate Management Team outlining the process for developing the next Capital Plan, covering the period from 2003 to 2005, as well as some of the issue that would arise during its development.

The process for developing the capital plan involves several components.

1. Capital Plan Staff Review Group

The Corporate Management Team takes overall responsibility for developing the Capital Plan and bringing it forward for Council approval. The detailed work of developing the plan is delegated to an interdepartmental staff group - the Capital Plan Staff Review Group (SRG).

The Capital Plan Staff Review Group for the 2003 - 2005 Capital Plan is comprised of:

The Staff Review Group began its work in the fall of 2001 with a request to departments and boards for expenditure proposals and supporting information. Prior to the review of individual project submissions, the group identified the process for allocating funding in the plan and considered other issues which would assist in developing a list of priority projects. These meetings focussed on the following:

The Staff Review Group was also guided by the priorities set for past capital plans. These included placing:

From February through May the SRG met with departments to discuss the expenditure proposals and how they fit with departmental and corporate priorities. The group then held a series of meetings from which emerged the draft allocation detailed in this report.

During development of the plan, the Staff Review Group encountered a number of projects for which no supporting Council policy or priority has been established. As a result the group felt it had no mandate to assign funding to them. These projects are considered further in later section of this report.

The draft plan was reviewed by the Corporate Management Team and endorsed forpresentation to Council as representing a balanced set of priorities for capital expenditures in the next three years.

2. Financial Limits for the Plan

In an accompanying report, the Director of Finance makes a recommendation for funding limits for the 2003 - 2005 Capital Plan. This financial limit includes two components:

· tax supported funding for the capital program,

· waterworks capital supported by user fees $43,940,000
· funding to be allocated to projects eligible for

These financial limits, totalling $243.9 million in tax and user fee support and $12.0 million in DCL funding have been utilized by the Staff Review Group in developing the draft plan outlined in this report.

Although the primary consideration in developing the Capital Plan is the amount of City funding that goes into the plan, the Capital Plan process acknowledges contributions to specific capital programs or projects that are received from:

The availability of funding from these other sources provides additional opportunities to upgrade and develop new City facilities beyond the level that would be available within the Capital Plan funding limit. These contributions have been conservatively estimated at $55.8 million should the recommended draft Capital Plan proceed as outlined.


The draft Capital Plan addresses several issues related to the proposed capital expenditure program for the period 2003 - 2005:

The Staff Review Group faced difficult choices in their deliberations. The cost of the requested projects exceeded the tax supported financial limit of the plan by $265 million. As a result, many worthwhile projects could not be accommodated within the draft plan. Those projects recommended by the Staff Review Group were identified as the highest priority for funding in the 2003-2005 Capital Plan.

The Draft Plan

The recommended draft plan has been consolidated under several categories which are summarized in Table 1 below. Details of the departmental submissions and the recommendations of the Staff Review Group are included in the attached document Submissions to the 2003-2005 Capital Plan (limited distribution) and a more detailed summary is attached to this report as Appendix 1.

Table 1: Summary of the Capital Plan Draft Allocation

Tax Supported Funding

DCL Funding

Capital Plan Category


$ 170,090,000


Public Works (Streets, Water, Sewers, Electrical, Traffic Signals, Yards)




$ 9,800,000


Public Safety (Fire and Police)

$ 25,950,000


Parks and Recreation

$ 9,000,000


Community Service (Affordable Housing, Social &Cultural Facilities, Downtown Eastside Initiatives, Public Art)

$ 19,025,000


Other (Information Technology, Facility Development, Major Building Maintenance)

$ 3,000,000


Supplementary Capital

$ 2,025,000


Debenture Costs

$ 243,940,000


Total Capital Plan

#1 Kingsway Joint-Use Civic Facility

One of the more significant components of the proposed Capital Plan is a joint-use civic facility at #1 Kingsway. Council approved the purchase of this property on September 18, 2001. In the intervening months, staff from Parks and Recreation, the Vancouver Public Library, Community Services, Facilities Development and Real Estate have worked together to bring a development proposal for the site to the 2003 - 2005 Capital Plan. That proposal is documented in more detail in an accompanying report.

The #1 Kingsway proposal includes the following components:

Functional Component

Area (sq. ft)


Funding Source


Sustainable Building Pilot Project



2003 - 2005 Capital Plan

Mt Pleasant Community Centre



2000 - 2002 Capital Plan
2003 - 2005 Capital Plan
SE False Creek CACs

Mt Pleasant Library



2000 - 2002 Capital Plan
2003 - 2005 Capital Plan




2003 - 2005 Capital Plan
City-wide DCLs

Market Rental Housing



Property Endowment Fund





As noted, the project involves a variety of funding sources including the 2000-2002 Capital Plan, the proposed 2003-2005 Capital Plan, City-wide DCL funds, CAC funds and an investment by the Property Endowment Fund in the market rental housing component. It should be noted that City-wide DCLs are allocated to the Kingsway day care facility to assist planning and project development. Consistent with Council policy on DCL spending in advance of approval of the recommendation arising from the Financing Growth Review, this allocation (as well as other allocations of City-wide DCL funding) will require Council approval as part of the approval of the Capital Plan financing strategy to be considered in September. Funding recommended from the 2003-3005 Capital Plan is reported with the funding proposal for each sponsoring department.

The balance of the draft allocation is summarized below:

a(i) Public Works (excluding waterworks): $128.1 million

Tax Supported Funding

DCL Funding

Programs / Projects


$ 14,170,000


Street infrastructure, including repairs to major bridges

$ 11,900,000


Pedestrian & bicycle improvements, including greenways and the bicycle network

$ 7,500,000


Transit and safety improvements

$ 13,165,000


Local area street improvements and traffic plans, including local improvements

$ 5,500,000


Traffic signal modification and replacement

$ 7,000,000


Major Projects

$ 7,000,000


Street lighting and communications improvements

$ 58,000,000


Sewer replacement and pollution abatement initiatives

$ 1,915,000


Yards upgrading program

The Public Works section of the Capital Plan deals with the funding requirements to maintain and upgrade the City's streets, sewers, traffic signals, street lighting and communications infrastructure. In developing the Public Works component of the plan, the Staff Review Group was guided by Council policy related to the ongoing replacement of the City's basic public works infrastructure as well as those related to transportation priorities for pedestrians, bicycles and transit improvements.

There are five major categories of expenditure in the Streets section of the Plan which address:

Overall the plan includes $59.2 million in City funding for Streets work which will be supplemented by approximately $35.2 million in funding from outside funders to support the maintenance and upgrading of the major road network and residential streets and provide safety improvements and amenities for pedestrians and bicycles.

One of the major "projects" in the recommended Capital Plan is the continued upgrading of the Burrard Street Bridge. The recommended funding will ensure completion of the proposed pedestrian and bicycle improvements to the bridge and will upgrade/replace the railings, stairs and light posts on the bridge. The total cost of this work is estimated at $14.5 million, including approximately $7.0 million from the 2000 - 2002 Capital Plan. The Staff Review Group were unable to provide additional funding to complete the seismic upgrading of the south approach to the bridge because of other funding priorities, but would support this project if additional funding were available in the Capital Plan.

The Street Lighting and Communications section of the plan provides funding to replace and provide limited upgrading of the City's street lighting and communications network. In the Street Lighting area, funding is provided to continue the renovation and upgrading of the street lighting system. The latter expenditure provides for maintenance and expansion of the City's voice and data transmission to meet the business needs of civic facilities as well ascontrol of vital systems.

The Capital Plan Staff Review Group has recommended an increase in the funding for the Sewers section of the draft plan in order to maintain the 1% replacement policy for sewers infrastructure. This funding had been reduced in the 2000 - 2002 Capital Plan in order to accommodate funding for the Cambie Yard relocation. Other expenditures are planned for sewer system management and pollution abatement, including continuation of the sewer separation on private property program that is directed at eliminating sewer outflows into surrounding water. The City has applied for significant sewer cost sharing from the Canada-BC Infrastructure Program that would augment funding recommended in this plan.

The plan also includes funding to continue the upgrade of Engineering works yards that was begun in the 2000 - 2002 Capital Plan. Although only $1.9 million has been allocated in the plan for work at Manitoba Yards, other projects at 900 Kent Street, totalling $9.5 million, are funded outside the plan.

a(ii) Waterworks $43.9 million

Tax Supported Funding

DCL Funding

Program / Projects





The second component of the Public Works capital allocation is for the waterworks. The allocation is governed by the policies established by Council for renewal and upgrading of the water system.

The recommended allocation at $43.9 million provides for infrastructure replacement ($28.2 million), system capacity and fire protection requirements ($7.6 million), completion of the dedicated fire protection system ($3.9 million) and monitoring, control and water quality initiatives ($3.7 million). Funding for the dedicated fire protection system (DFPS) will complete the first phase of this development that began in the 1991 - 1993 Capital Plan.

The proposed allocation is approximately 25% below the 2000 - 2002 Capital Plan because of the completion of the DFPS and a reassessment of the life cycle of some water infrastructure. This reduction will have a moderating effect on water rates over the next few years.

b) Library: $5.05 million

Tax Supported Funding

DCL Funding

Program / Projects


$ 4,850,000


Relocate Mount Pleasant Branch Library in #1 Kingsway Project

$ 200,000


Branch Library Major Maintenance

The Library submitted two proposals for changes to its branch network as well as a request to support major maintenance issues throughout its system. The Capital Plan Staff Review Group has recommended funding be provided for relocation and upgrading of the Mt. Pleasant Library Branch as part of the joint-use facility at #1 Kingsway. Funding of $5.05 million, including $200,000 remaining from the 2000 - 2002 Capital Plan and $4.85 million from the draft 2003-2005 is recommended.

The second request for funding for a new branch library in the Downtown Eastside /Strathcona could not be accommodated in the draft Capital Plan but is included on a list of significant projects that have not been funded but are put forward for Council consideration.

c) Community Services: $9.85 million

Tax Supported Funding

DCL Funding

Program / Projects


$ 2,500,000


Affordable Housing Fund

$ 3,250,000


Social, child care, and cultural facilities

$ 2,500,000


Initiatives associated with the revitalization of the Downtown Eastside



Public Art Program

The proposed funding levels for Community Services projects takes a number of issues into consideration:

Funding for the Affordable Housing Fund will ensure that the City is able to follow through with the initiatives anticipated in the Provincial-Municipal Housing Partnership approved by Council as well as continue the program of City-initiated non-market housing initiatives. In addition to tax supported funding of $2.5 million, the Staff Review Group is recommending allocation of up to $2.5 million of City-wide DCL funding to deal with replacement housing issues.

Funding for the Social and Cultural Facilities component of the plan provides for maintenance and upgrading of City-owned and non City-owned social, cultural and daycare facilities, including:

In May 2001, Council reduced the current capital plan by deferring $1.0 million in funding for the Little Mountain Neighbourhood House relocation for consideration in the 2003 - 2005 Capital Plan. Funding for this project has been included in the last two plans, however, a suitable site has only recently been identified. With the funding reduction, there remains sufficient funds in place to purchase a site for the relocation, but no funding to support construction. Even with site purchase, facility development will not likely occur during the next Capital Plan and the SRG was not prepared to allocate funding in the face of other demands. As a result, additional funding for Little Mountain Neighbourhood House has been added to the list of projects that are presented for Council consideration.

Funding to support Council's initiatives on the Downtown Eastside is also recommended at $2.5 million in the draft plan. During the next phase of the program, including the implementation of the Vancouver Agreement, the City will likely be called on to participate with senior governments in projects which might include:

There were two requests in this area of the Plan that the Staff Review Group had difficulty dealing with both because of the size of the request (totalling $12 million) and because they have no Council policy or priority attached to them. The Gastown Heritage Management Program and the Gastown / Chinatown Building Facade Program are considered further in a later section of this report. The programs will be the subject of a separate report to Council in July, 2002. Should Council wish to proceed with funding from the Capital Plan, provision will have to made either by reallocating funding within the existing financial limit or by adding funding to the plan.

d) Parks & Recreation: $35.35 million

Tax Supported Funding

DCL Funding /
Other Funding

Capital Plan Category




Recreation Facilities, including Community Centres, Rinks, Pools and Concessions



Land Acquisition



Street Trees Program



Park Development, including neighbourhood parks, playgrounds and playfields



Major Parks, including Stanley Park, Queen Elizabeth Park and Hastings Park

The Parks & Recreation component of the Capital Plan addresses funding requirements in three areas: Facilities Development, including the community centre and community recreation facility system; Park Development, including the maintenance and development of major and neighbourhood parks; and Land Acquisition, including funding to increase the park inventory in park deficient neighbourhoods. The Parks & Recreation component also includes funding to continue the restoration of Hastings Park.

The allocation to the Park Board reflected both the many priorities for funding in the Capital Plan and the priorities determined by the Board. The Staff Review Group have recommended funding:

There are two projects that were priorities for the Park Board that the Staff Review Group was unable to fund within the financial limit.

Given the major projects included in the Park Board Plan, including the Mt Pleasant Community Centre replacement and the replacement of Killarney Pool, and the competing priorities elsewhere in the plan, the Staff Review Group was not prepared to recommend funding for these projects.

Final allocation of the recommended funding is the responsibility of the Park Board. At the present time, the Board is collecting public input on the allocation of the funding in the draft plan. The final allocation will be reported to Council prior to final approval of the Capital Plan.

e) Other Civic Facilities: $19.025 million

Tax Supported Funding

DCL Funding

Programs / Projects




Replace Firehall #15 (design)



Police Officer Training Centre, Police Precinct Study, relocate Dog Squad



Major maintenance of civic buildings, including the roof replacement program



City Hall Precinct Upgrades



Facilities Structural Upgrade Program



Back-Up City Hall



Sustainable Building Pilot Project:
#1 Kingsway

This section of the draft Capital Plan deals primarily with the balance of the civic infrastructure, most notably the 280 buildings from which the City delivers its core services.

An integral part of the process for developing the Capital Plan was an update of the Facilities Strategic Plan that was formalized during the planning for the 2000 - 2002 Capital Plan. This plan has three main purposes:

The report of the Facilities Strategic Planning Group was utilized as a resource document in developing the facilities-related funding in the draft plan and the Manager of Facilities Development & Maintenance provided advice to the group.

There are a number of significant projects recommended in the draft plan:

· $275,000 to improve building security at the Civic Theatres;
· $600,000 to continue the City Hall precinct upgrading program;
· $375,000 to upgrade the new Fire Department training centre on Chess Street to act as a back-up City Hall facility.
· $175,000 to fund sustainable building components as part of the #1 Kingswaydevelopment.
· $100,000 to develop a comprehensive facilities-related emergency response strategy to identify priorities for upgrading civic / other buildings to respond to post-disaster situations.

f) Information Technology

Tax Supported Funding

DCL Funding

Programs / Projects




IT Infrastructure



SAP Expansion Phase I & II



Revenue Billing Systems

The City's information technology (IT) infrastructure includes shared corporate systems and telecommunications infrastructure, voice systems, local area networks and desktop services like office applications and e-mail. If this infrastructure is to meet the City's increasing reliance on information systems and its use of electronic communications to interact with its stakeholders - public, staff, business partners and other levels of government, obsolete equipment must be replaced, system capacities must be increased; processes, tools and standards must be put in place to manage increasing complexity and cost; and robustness built in so that information integrity and system availability are maintained in the face of potential threats.

Council has already provided ongoing funding to support these goals, however, the current allocation of approximately $5.0 million annually needs to be supplemented if the City is to keep up. The Staff Review Group is recommending that an additional $5.0 million (approximately $1.7 million annually) be directed to meet these requirements. This funding will permit the City to:

· Take the first steps towards integrating its data and voice systems. The key benefit from the convergence of these technologies is the elimination of what are currently parallel voice and data networks. Other benefits include improved phone mobility and better customer service through computer-telephony integration.
· Increase the robustness of its information systems so that they can continue to provide core services to the public even in the event of a major disaster. This will include deployment of redundant telecommunications connections, deployment of mirrored application and data servers, and potentially out-of-province data replication.

In addition to maintaining current infrastructure, there are several corporate business systems that require upgrading. The Staff Review Group have allocated funding to two specific projects:

Should Council support this allocation, it is proposed that the $5.0 million in ongoing funding and the $6.5 million in one time project funding be removed from the draft Capital Plan and treated in a similar fashion to the existing funding for the Information Technology Long Term Financing Plan.

g) Supplementary Capital

Supplementary Capital is intended to deal with emergent issues that arise during 2003 - 2005Capital Plan. There are a variety of program and project proposals for which departments requested funding that were either of a smaller scale than could be considered in the plan, where the immediacy for undertaking the work was not established, or where the issues or request were not well defined. These items were not included in the plan and the potential for submitting them to future Supplementary Capital Budgets was identified. The draft plan recommends funding to deal with these projects on an annual basis be set at $3.0 million. This level represents a reduction of 40% from the 2000 - 2002 Capital Plan provision of $5.0 million, resulting in some loss of flexibility to deal with issues that arise during the plan.


As noted throughout this report, there are a number of significant programs / projects that were not funded by the Staff Review Group. There are two primary reasons the SRG note for not providing the requested funding:

A brief description of these projects follows:

Granville Street Bridge Safety Improvements $10.0 million

Inner City Streetcar System $10 - $65 million

Little Mountain Neighbourhood House $1.0 million

Coal Harbour Arts Centre $10.0 million

Gastown Heritage Building Upgrade Program $10.5 million
Gastown/Chinatown Building Facade Program $1.5 million

Sunset Community Centre $5.0 million

QE Park Reservoir Restoration $5.0 million

While the Staff Review Group was not able to allocate funding to these projects, it is noted that some may be eligible for cost sharing from outside sources. Should this funding be forthcoming during the next three years, the lack of City funding could prove to be problematic. On the other hand, given the cost of these projects and the demand for capital expenditures in this plan, it is difficult to justify allocations to projects that may not be undertaken. Moreover, it is uncertain how much City funding might be necessary over the next three years.

There are a number of options that Council could utilize should there be a need to match senior government or other funding during the 2003 - 2005 Capital Plan:

In considering these options, the Staff Review Group and Corporate Management Team believe that the third option is preferable because it maintains allocations for important capital works included in the draft plan and ensures that, should cost-sharing be available, the City would have the option of proceeding with additional work. A "pool" of funds of approximately $20 million would be appropriate should Council prefer this option. Consideration of this strategy could be part of the public process to review the 2003 - 2005 plan.

The Director of Finance notes that this strategy effectively adds $20 million to the capital envelope and, if accessed, could result in property tax impacts in the future, those impacts being dependent on how much of the "pool" is utilized and when. However, the advantage of this strategy is that it gives Council the flexibility to react to cost sharing opportunities for important capital needs that may arise during the plan.


This report provides the recommendations of the Capital Plan Staff Review Group and the Corporate Management Team as to the funding priorities for the 2003 - 2005 Capital Plan. Throughout its deliberations, the Staff Review Group attempted to take into consideration the priorities of Council and the public, however, it is acknowledged that the draft plan is really staff's view. In addition to providing the opportunity for Council to consider the components of the draft plan, it is appropriate that the public should also be given the opportunity to provide its input.

Park Board is currently in the midst of its consultation with the public on the Capital Plan and will be reporting its results to Council prior to the plan being finalized in September. In addition, the Staff Review Group has developed a process to publicize the contents of the draft Capital Plan and to encourage public feedback, culminating in a public meeting on September 17, 2002. The components of the public process include:

· an information video to be shown on Shaw Cable outlining the capital plan process andinviting the public to become informed about the plan and to provide input;
· a newspaper flyer summarizing the draft Capital Plan priorities to be delivered in a July issue of community newspapers and distributed through community centres, branch libraries and other civic facilities. This will be modelled after the What do you think? documents produced for the past two Capital Plans;
· the same information in the flyer will be available on the 2003-2005 Capital Plan webpage which can be accessed from the City homepage;
· a follow-up to the video outlining the Capital Planning process that will outline the major components of the draft plan. The video will be aired on Shaw Cable during Council breaks and on the greater.vancouver program;

Feedback from the public will be encouraged by means of the Capital Plan Questionnaire (Your Opinion), which will be available in the flyer and on-line on the Capital Plan webpage.
The public meeting will provide Council to opportunity to hear reaction to the draft Capital Plan from departments, boards and the public.

Following the public meeting, Council will be asked to make final decisions on the contents of the plan on October 1, 2002. This approval will be followed by a report recommending a financial plan outlining the sources of funding to support the Capital Plan. The components of the plan requiring borrowing authority will be submitted to the electorate in a series of plebiscite questions during the civic election on November 16, 2002.

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