ADMINISTRATIVE REPORT
Date: May 6, 1996
TO: Vancouver City Council
FROM: Director of Finance
SUBJECT: 1996 Basic Capital Budget
RECOMMENDATION
A. THAT Council approve allocation of the 1996
Capital-from-Revenue funding to the 1996 Capital Budget as
follows:
Supplementary Capital $ 1,590,000
Engineering 6,173,000
Park Board 1,659,000
Social & Cultural Facilities 928,000
Other 3,850,000
Total $14,200,000
B. THAT Council approve the Park Board Basic Capital Budget
totalling $6,583,000, as detailed in the Park Board report
(Appendix 2)*, with $4,924,000 of that funding to come from
borrowing authority approved as part of the 1994-1996
Capital Plan.
C. THAT Council approve the 1996 Fire Protection Basic Capital
Budget totalling $430,000 as summarized in this report and
detailed in Appendix 3*; source of funds to be borrowing
authority as approved as part of the 1994-1996 Capital Plan.
D. THAT Council approve the Capital Budget allocations to the
Social and Cultural and Other components of the 1996 Basic
Capital Budget as summarized in this report and detailed in
Appendix 3, including the allocation of $450,000 from the
Capital Reserve to fund the Dance Centre proposal.
GENERAL MANAGER'S COMMENT
The General Manager of Corporate Services RECOMMENDS approval of
A, B, C and D.
COUNCIL POLICY
The 1994-1996 Capital Plan includes provision for $40,550,000 in
capital expenditures to be funded from the Operating Budget (Capital
from Revenue). The 1996 component of this funding is $14,200,000.
PURPOSE
The purpose of this report is to summarize the 1996 Capital Budget and
to seek Council approval for the allocation of Capital from Revenue
and for the debenture authority necessary to complete the funding of
the 1996 capital program.
BACKGROUND
The 1994-1996 Capital Plan forms the framework within which annual
capital budgets are prepared. The two components of the annual
Capital Budget are Basic Capital, which includes project-specific
items that were included in the Capital Plan, and Supplementary
Capital, which includes items that had not been anticipated in the
Capital Plan but which have become a priority during the course of the
Plan. Funding for these capital budgets comes from debenture
borrowing approved by plebiscite and/or by Council and from Capital
from Revenue approved as part of the annual Operating Budget.
On February 27, 1996, Council approved the 1996 Engineering Basic
Capital Budget along with the debenture portion of the funding
program. Funding to be provided to the Engineering Capital Budget
from the Operating Budget (Capital from Revenue) is included in the
recommendations of this report.
On April 25, 1996, Council approved the final estimates of the 1996
Operating Budget, including a provision of $14,200,000 to support the
City s capital program.
FUNDING FOR THE 1996 BASIC CAPITAL BUDGET
The following table summarizes the total funding for the 1994-1996
Capital Plan (including unallocated borrowing authority from prior
Capital Plans) and the portion to be allocated to the 1996 Capital
Budget.
Capital
Plan Prior 1996 Unallocated
Funding Allocations Budget Balance
($000) ($000) ($000) $(000)
Capital from Revenue: $40,550 $26,350 $14,200 0
Debenture Authority(1):
Plebiscite (2) 87,905 63,008 23,813 1,084
Sewer 49,250 35,955 13,295 0
Water 53,720 37,123 16,598 0
Total Debentures $190,875 136,085 53,706 1,084
Total Funding $231,425 $162,435 $67,906 $1,084
(1) includes borrowing authority approved in advance for
Engineering projects, as follows:
- Plebiscite Authority $19,543,000
- Sewer & Water Authority $29,893,000
(2) plebiscite authority excludes:
- $2,795,700 in infrastructure borrowing authority outstanding
from the 1987-1990 capital plan, of which $2,500,000 million
provides back-up funding for the Emergency Operations and
Communications Centre.
Capital from Revenue funding of $14,200,000 was provided in the 1996
Operating Budget and Recommendation A of this report allocates this
funding to individual capital budgets.
The $53,706,000 balance of the funding for the 1996 Capital Budget
comes from debenture authority, including $23,813,000 in plebiscite
authority and $29,893,000 in sewer and water borrowing authority
approved by Council. This is reported inclusive of the borrowing
authority previously approved for the Engineering Capital Budget. The
1996 allocation will leave $1,084,000 in unallocated borrowing
authority from the 1994-1996 and prior Capital Plans.
Appendix 1 of this report summarizes the funding allocations to the
individual components of the 1996 Capital Plan.
FUNDING FOR THE 1996 SUPPLEMENTARY CAPITAL BUDGET
The 1994-1996 Capital Plan includes funding of $4,680,000 for the
Supplementary Capital Budget. The 1996 allocation provided for in the
Plan, and recommended in this report, is $1,590,000. Council has
previously approved $762,000 of this funding to individual items
leaving $828,000 to be allocated from among the funding requests. A
report recommending allocation of this funding accompanies this report
to Council.
COMMENTS ON THE BASIC REQUESTS
The Engineering Capital Budget was detailed in the Administrative
Report approved by Council on February 17, 1996. Details of the Park
Board Capital Budget are attached as Appendix 2 and details of the
balance of the Capital Budget are attached as Appendix 3.
1. Engineering
As noted, the Engineering Basic Capital Budget, totalling $54,525,000
was approved by Council on February 27, 1996, subject to approval of
Capital from Revenue. Approval of the recommendations in this report
will allocate Capital from Revenue to complete the funding of this
budget.
With approval of the recommendations in this report, all but
$1,084,000 of 1994-1996 Capital Plan funding will have been allocated
to project budgets. The outstanding borrowing authority in Streets
(Granville Bridge Safety Improvements, $226,000) and Communications
(Police Dispatch Console Replacement, $857,000) will be carried
forward into the 1997-1999 Capital Plan.
2. Park Board
The 1996 Capital Budget from the Park Board is summarized in the
following table:
1994-96 Prior 1996
Capital Plan Approvals Budget
Land Acquisition $ 3,882 $ 3,793 $ 0
Park Development 11,799 7,739 3,831
Facility Development 9,799 7,071 2,642
Debenture Costs 0 290 110
Total $25,480 $18,897 $6,583
Details of the Park Board requests are set out in Appendix 2. These
requests include $1,198,500 in funding related to projects which
required early approval and which was approved in advance by Council
on March 12, 1996.
The Park Board Capital Budget proposes several projects which will
expand the services provided by the Park Board and which will require
additional operating costs to be added to the global operating budget
in future years. As identified in the submission of the Park Board,
these additional operating costs will be approximately $103,500. Some
of the increases that have been identified are:
New Brighton Park $20,000
operating costs associated incorporating
additional land and a reconfigured site
at New Brighton Park.
Playfield and Playground Upgrading $14,300
the operating costs associated with field
improvements, new irrigation systems and
playgrounds at City parks.
Street Tree Program $31,500
the cost of maintaining the additional
street trees to be planted in 1996.
Information Systems $31,700
the ongoing costs of maintaining lease
telephone lines to provide data communica-
tions among Park Board facilities and
between the Park Board and City.
Fieldhouse Upgrades $6,000
the costs of maintaining improved field-
house facilities in City parks.
In addition to these specific items, increased operating costs are
anticipated for projects for which no estimates are currently
available.
3. Fire Protection
The following table summarizes the Fire Protection component of the
Capital Plan, the allocations made in the 1994 and 1995 capital
budgets and the current status of the funding:
Capital Plan 1994/1995
Allocation Funding
Firehall reconstruction
seismic upgrading $3,380,000 $1,020,000
Emergency radio channel 1,040,000 770,000
Fire training site 1,230,000 1,070,000
Total $5,650,000 $2,860,000
Unallocated Balance 2,790,000
Reallocated to EOCC (2,360,000)
Balance to 1996 Capital Budget $ 430,000
On July 25, 1995, Council approved the recommendations of the City
Manager that a varying bylaw be approved with the purpose of
reallocating $2,360,000 of remaining Fire Protection Capital funding
to development of the new Emergency Operations and Control Centre.
This funding, provided from debenture authority, has exhausted the
firehall upgrading and replacement allocation in the Capital Plan and
deferred consideration of the associated projects until the 1997-1999
Capital Plan.
On March 14, 1996, Council approved the recommendation of the General
Manager of Fire and Rescue Services that the City apply for $1.0
million in BC21 project funding to complete the Fire Training Site.
At that time Council allocated the remaining funding of $160,000 in
advance of the 1996 Capital and allocated an additional $770,000 to
this project from the next Capital Plan (with interim funding from
Revenue Surplus). Approval of the borrowing authority associated with
the $160,000 allocation is now required and is included as part of
Recommendation C.
The balance of the fire protection capital to be allocated in 1996
($270,000) relates to the new emergency communications channel.
Funding for this allocation is to be provided from borrowing
authority.
4. Social and Cultural Facilities
The 1994-1996 Capital Plan includes funding of $4,374,000 for projects
related to social and cultural facilities owned by the City and by
others. These include upgrading or relocation initiatives for social
service, daycare and cultural facilities and funding for the public
art program.
In 1994 and 1995, $3,446,000 of this funding was allocated to
individual capital programs leaving $928,000 in funding to be
allocated in the 1996 Capital Budget as follows:
- capital requirements related to City-owned facilities
including daycare integration ($387,000);
- the capital grant program which supports the capital needs
of social and cultural facilities not owned by the City
($222,000); and
- continuation of the Public Art program ($319,000).
On March 28, 1996, Council approved the allocation of $900,000 from
the Social and Cultural Facilities category of the 1994-1996 Capital
Plan to fund a prepaid lease of PEF property for the Dance Centre.
This proposal was based on an assessment of specific project funding
needs in 1996. A subsequent review completed as part of the
development of this report indicates that additional funding will be
needed, leaving the Dance Centre proposal in a shortfall position.
The Director of Finance is therefore recommending that Council
allocate $450,000 from the Capital Reserve as back-up funding for the
Dance Centre proposal. This recommendation is reflected in the
funding allocation in recommendation D.
Approval of this additional funding gives consideration only to those
projects that are likely to come forward in 1996. Should additional
requirements be identified prior to year-end, alternative funding
arrangements will have to be determined.
Allocation of these Social and Cultural funds to specific projects
will require future Council approvals.
5. Other
The "Other" category of the Capital Plan included allocations for
maintenance and renovation of the City Hall precinct and
Museum/Planetarium complex and for affordable housing initiatives.
Funding for these projects was provided in the 1994 and 1995 Capital
Budgets.
The 1996 allocation of $3,850,000 provides the balance of the funding
designated for the restoration of Hastings Park and will bring the
total funding allocated to that project in the Capital Plan to
$4,850,000. These funds are available to continue the Park planning
process and to begin the restoration work in 1997 and will be subject
to specific Council approvals at a future date.
CONCLUSION
The 1996 Capital Budget represents the last annual budget arising from
the 1994-1996 Capital Plan and provides for the allocation of funding
included in that Plan to individual projects and programs.
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