SUPPORTS ITEM NO. 5
CS&B COMMITTEE AGENDA
JUNE 27, 1996
ADMINISTRATIVE REPORT
Date: May 30, 1996
TO: Standing Committee on City Services and Budgets
FROM: Director of Finance
SUBJECT: 1996 Grant Requests -
Vancouver Art Gallery Association
RECOMMENDATION
A. THAT a 1996 operating grant of $1,861,300 be approved to the
Vancouver Art Gallery Association; source of funds being the
1996 'Other' Grants budget.
B. THAT a one-time grant of $23,462 be approved to the
Vancouver Art Gallery Association for reimbursement of the
cost of the escalator repair; source of funds to be
Contingency Reserve.
CONSIDERATION
C. THAT a one-time grant of $24,000 be approved to the
Vancouver Art Gallery Association to fund 1/3 of the cost of
the loading dock project; source of funds to be Contingency
Reserve.
D. THAT a grant of $60,000 be approved to the Vancouver Art
Gallery Association to fund the first year of a five-year
Closed Circuit Television Security System replacement
program; source of funds to be Contin-gency Reserve.
GENERAL MANAGER'S COMMENTS
The General Manager of Corporate Services RECOMMENDS approval of
A and B, noting that the cost ($23,462) to repair a major
structural breakdown of one of the escalators would normally be
considered a landlord responsibility.
Items C and D are submitted for CONSIDERATION, noting that there
is no signed operating agreement between the City and the Art
Gallery to witness a clear division of responsibilities between
the two parties, although the City and Art Gallery staff are
working to conclude such an agreement in the near future. In my
opinion, items C and D relate directly to the tenant s occupation
of the building and should clearly remain their responsibility.
On the other hand, both parties have put funds into maintenance
items similar to consideration D over the years. Given the mixed
funding treatment similar items have received in the past,
Council may wish to fund item C and/or D from Contingency
Reserve, but I would respectively suggest that item D (security
of the collection) is a higher priority for the City despite the
Art Gallery s ranking of these items.
COUNCIL POLICY
City Council, on March 31, 1992, approved a change in the basis of the
City s financial support to the Vancouver Art Gallery Association from
a grant to support specific items to a grant supporting general
operations. Funding for one-time new and non-recurring items continues
to be considered outside of the base grant.
City Council, on April 19, 1994, when dealing with the 1994 - 1996
Budget Management Program proposals, approved a 5% reduction to the
1993 funding base of the operating grants to the Museum Associations
and the Vancouver Art Gallery Association.
Approval of grants requires eight affirmative votes of Council.
BACKGROUND
The operating grant to the Vancouver Art Gallery Association is
adjusted annually by a blended inflation factor determined by the
Director of Finance. The 1996 adjustment factor is calculated using
the ratio of the CUPE 15 salary and benefit costs to other costs in
the Vancouver Art Gallery's operation, and weighted by the average of
the CUPE 15 negotiated settlement and the City's general inflation
factor for 1996.
DISCUSSION
A. 1996 Operating Grant
The composite inflation rate used in calculating the 1996 operating
grant for the Vancouver Art Gallery Association is 2%, reflecting a
50/50 split between the wage cost and other support costs in the
Association's operation.
The 1996 operating grant to the Vancouver Art Gallery Associa-tion is
calculated as:
1995 base grant $1,828,800
Add: 1996 composite rate - 2% 36,600
1996 grant $1,865,400
The Director of Finance recommends that a 1996 operating grant of
$1,865,400 be approved to the Vancouver Art Gallery Association, with
the source of funds to be the 1996 'Other' Grants budget.
B. New and Recurring Items
Three new and non-recurring requests totalling $107,462 have been
submitted by the Vancouver Art Gallery Association, and are being
presented in the priority order as identified by the Association.
(Details of the requests are on file in the City Clerk's Office).
1. Escalator Repair
The four escalators in the Vancouver Art Gallery are 13 years old
and have inherent design problems. On April 16, 1996, one of the
escalators experienced a major structural breakdown and the
necessary repairs were undertaken and completed at a cost of
$23,462. The contractor also recommended that similar work be
done on the remaining 3 escalators at a cost of $31,700 in order
to prevent similar incidents from happening in the future.
However, this work can be delayed until 1997.
The Association has an annual maintenance budget of $25,000 for
the maintenance and servicing of the escalators, but the budget
does not cover extraordinary repairs. The Association has
requested the City to fund the one-time repair cost of $23,462,
and consider funding the $31,700 required for the remaining 3
escalators in 1997. It is estimated that the replacement cost
for the 4 escalators is $417,000.
2. Loading Dock Renovation
For safety and security reasons, the renovation to the
below-grade loading facilities is being identified as the second
priority by the Association in their 1996 NNR request.
The location of the loading dock has been a problem for the
Association since their move to the current site in 1983. The
loading bay is too short to accommodate most trailer rigs; the
entrance to the loading bay is too narrow; and there is limited
truck manoeuvrability in the tunnel outside of the loading area.
Staff have been using the Pacific Centre truck tunnel adjacent to
the loading bay entrance or the Hornby Street car pull-in for
loading. The moving of oversized and heavy crates over a long
distance with inadequate equipment post a safety risk to the
staff; as well, security of the works of art is compromised when
loading and unloading is done in areas with heavy public traffic.
The situation can be improved by the construction of concrete
pits and the installation of stationary elevating docks in both
the loading bay and the truck tunnel. At the same time, the
Association propose to re-configure the entire loading area to
provide extra storage space.
It is estimated that the project will cost $72,600. The
Association has internally allocated $24,600 to fund specific
items in the project, and has applied to BC 21 in December 1995
for 1/3 cost-sharing of the project. The Association has
requested the City to provide the remain-ing 1/3 matching funding
of $24,000. The BC 21 and City funds, if approved, will be
directed to fund the concrete pits at the loading bay and the
tunnel, and to partially fund the two stationary elevating docks.
In the event that external funding is not approved, the
Association will proceed with the project at a slower pace using
its own funds.
3. Closed Circuit Television Security System
Security at the Vancouver Art Gallery has been identified as a
problem for many years. Recently, the security co-ordinator of
the City has completed a review of the security camera system and
recommends the purchase of a new system at a cost of about
$300,000. The plan is to add new security cameras and monitors
over time so that a
complete system will be in place at the end of the project. The
Association is requesting the City to fund this project over a
five year period, with the first instalment in 1996 at a cost of
$60,000. If funding for this project is approved, the project
will be managed by City Building Management Services staff.
The Manager of Building Management Services, Corporate Services, has
reviewed the requests and has confirmed that the works are necessary
and the estimates are reasonable. He did not comment on the priority
of the escalator repair as it has been done on an emergency basis, and
the outstanding issue with this item is the source of funds for the
project.
FINANCIAL IMPLICATIONS
The Director of Finance recommends approval of the funds for the
escalator repair ($23,462), and submits the loading dock request
($24,000) and the security system request ($60,000) for consideration.
Further, it should be noted that the approval of the $60,000 for the
1996 portion of the closed circuit television security system does not
commit the City to fund any remaining part of the project. The
request will be brought back each year for Council's approval before
the project of the year is to proceed.
The source of funds for these requests, if approved, is to be
Contingency Reserve.
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