ADMINISTRATIVE REPORT
Date: September 16, 1996
TO: Vancouver City Council
FROM: Director of Finance
SUBJECT: 1997-99 Capital Plan
RECOMMENDATION
THAT the Capital Plan, as set out in Appendix A, and as modified
this day, be approved in principle, and that the Director of
Finance report back on the breakdown of funding between Revenue
funds and Borrowed funds, and on the proposed wording for the
questions in the plebiscite.
GENERAL MANAGER'S COMMENTS
The General Manager of Corporate Services RECOMMENDS approval of
the foregoing.
COUNCIL POLICY
On July 23, 1996, Council approved the following resolution:
THAT the recommended plan for $165 million, as set out in the
Policy Report dated July 15, 1996, be received and circulated to
the public, leading up to a public meeting on September 23rd to
receive public comment, and for final adoption on September 24th.
PURPOSE
This report seeks Council's final consideration and approval of the
content of the proposed 1997-99 Capital Plan.
BACKGROUND
On July 23, 1996, Council approved, in principle, the proposed Capital
Plan at a cost of $165 million. This amount reflects:
- Council's approval of the regional radio program, which will
involve a financial commitment, outside of the Capital Plan,
of approximately $23 million; and
- The re-allocation of $10 million of 1997-99 Capital from
Revenue funds to the Information Technology infrastructure
replacement program.
Council also approved a public consultation program on the contents of
the Capital Plan. The main elements of that consultation included:
- Public Information Flyer - distributed to residences on the
Labour Day weekend, providing information on the contents of
the proposed plan, and requesting responses to be sent back to
the City;
- Citizen's Survey - telephone opinion poll conducted by
MarkTrend, based on scientific polling techniques to a
randomly chosen sample of citizens;
- Information posted on the City's Internet Home Page, also
requesting responses;
- Mailing to local community groups, providing detailed
information on the proposed Plan, and requesting responses;
- A short video produced and shown by Rogers Community
Television.
On September 23, 1996, Council is scheduled to hold a public meeting on
the Plan. At that time, Council will receive representations from the
public, as well as to receive information on the responses to the flyer
which was distributed to residences on the Labour Day weekend.
On September 24, Council will receive a presentation from MarkTrend
Research on the results of the Citizen's survey which was conducted in
August.
DISCUSSION
The proposed Capital Plan, as summarized in Appendix A, represents the
culmination of a planning process by Council and staff. This Plan is as
recommended by the Staff Review Group.
In finalizing this Plan, Council may wish to make certain adjustments,
arising out of the public consultation process. Any contemplated
changes should be dealt with at this time, and the recommendations of
the report modified to reflect those changes.
When Council was considering the report of the Staff Review Group in
July, there was a request to review the discussion around the setting of
the financial ceiling for the Capital Plan. The following summarizes
the earlier presentation.
In considering the affordability of the Capital Plan, two major
constraints were identified:
- impact on future tax increases
- overall debt burden of the City
With respect to taxes, the Plan is "sized" such that future debt charges
and capital from revenue contributions can be "fitted" within future
Operating Budgets without generating tax increases beyond normal
inflation. These projections are based on normal growth in the budget
and do not allow for extraordinary growth in revenues not major shocks
such as loss of Provincial grants.
With respect to the City's overall debt burden (excluding water debt),
the projections which were reported to Council on March are reproduced
in Appendix B. As was previously reported to Council, the traditional
guidelines about debt as a percentage of the Operating Budget are
projected to be exceeded in 1999. While these guidelines are not
absolute, there is cause to be reasonably cautious about the growth in
debt. It was also noted in March that the basis for calculating these
guidelines will change in the future, with the introduction of the sewer
and solid waste utilities.
Subsequent Actions
Once Council approves the Plan, as presented in this report, along with
other changes which maybe decided this day, there are a number of other
steps leading up to the November plebiscite.
a) Funding Sources
The funding for the Plan comes from three sources:
- Borrowing authority not requiring voter approval - sewer and
water
- Borrowing authority requiring voter approval
- Capital from Revenue - 1997-99 budgets
The Capital from Revenue will be allocated to certain program areas, and
the remaining amounts (excluding sewer and water) will require voter
approval. This allocation will be reported to Council on September 26.
b) Plebiscite Questions
The issues around the plebiscite questions will also be addressed by
Council on September 26. Typically, there are two or three separate
questions on the plebiscite, such as public works, public safety, and
parks and recreation, and Council direction will be
sought. Specific wording of the questioning will be then addressed by
staff, with a final review by Council (or a delegated sub-committee of
Council).
c) Public Information Program
Leading up to the plebiscite, an information program will be initiated
to inform the electorate about the contents of the Plan. The Citizen's
Survey identified that the electorate will want information about:
- how and where the money will be spent
- how taxes will be affected
- goals of the plan
- how and by whom the priorities were set
An information program is being developed which will include a brochure
to be delivered to all residences, a media campaign, and a continuation
of the information program by Rogers Community Television.
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