CITY OF VANCOUVER

M E M O R A N D U M

FROM: City Clerk's Office DATE: February 24, 1998

FILE: 1602

TO: Vancouver City Council

SUBJECT: 1998 Engineering Basic Capital Budget

An introduction of the Report Reference on the 1998 Engineering Basic Capital Budget will be provided by Dave Rudberg, General Manager of Engineering Services, followed by a more detailed presentation from Don Brynildsen and Sheri Plewes, Assistant City Engineers.

The attached Administrative Report dated February 17, 1998, refers.

CITY CLERK

ADMINISTRATIVE REPORT

Date: February 17, 1998

Author/Local: P.Docharty/6102

CC File No. 1602

TO: Vancouver City Council

FROM: General Manager of Engineering Services

SUBJECT: 1998 Engineering Basic Capital Budget

RECOMMENDATIONS

A.THAT the 1998 Street, Sewers, Waterworks, Street Lighting and Communications Basic Capital Budgets, as summarized in this report and detailed in Appendix 1 (limited distribution) be approved, with the funding to be provided from the following sources;

(1)$56,274,000 from borrowing authority as approved as part of the 1997-1999 Capital Plan; and

(2)$3,000,000 from 1998 Revenue Capital, subject to the approval of the 1998 Operating Budget.

B.THAT a temporary Electrical Technician position in the Street Lighting Design Branch be made permanent, at an annual cost of approximately $60,000, to be recovered from Street Lighting Capital through the existing overhead loading rate.

C.THAT the transfers of Capital Funds, as detailed in Appendix 2, for Waterworks and Sewers Capital closeouts, be approved.

D.THAT the public sewer connection fees for 1998 be increased by approximately 1% as shown in Appendix 3.

E.THAT the Director of Legal Services be requested to amend the Plumbing By-Law in accordance with Recommendation "D" of this report.

COUNCIL POLICY

In November 1996, Council approved the 1997-1999 Capital Plan which set a level of funding for specific Capital programs over those three years. Voters approved borrowing authority for the Public Works portion, excluding the Sewers and Waterworks Capital Plans, which are approved by Council.

Funding from the Capital Plan is allocated to specific capital programs through annual Capital Budgets. Funding for annual Capital Budgets is provided from a combination of borrowed funds, as approved in the plebiscite, and revenue funds, with the revenue portion being subject to approval of Capital from Revenue in the Operating Budget. Council approval of the annual Capital Budget is required before work can proceed on specific projects.

Closeouts of completed Capital projects whose expenditures exceed $50,000 and 15% of the approved budgets, require Council approval.

In June 1995, Council directed departments to use CityPlan to guide policy decisions, corporate work priorities, budgets and Capital Plans.

Major policies for Engineering Services Programs are summarized below:

STREETS

Vancouver Transportation Plan

On May 27, 1997, the Vancouver Transportation Plan was approved by Council. There are many policies in the Transportation Plan which have Capital Budget implications. As outlined in Action Item "F2" of the Transportation Plan, the priority for pedestrian and transit require funding to support these modes. Re-allocations to support these priorities were made to the 1997-1999 Capital Plan and are reflected in the annual budgets. After maintenance requirements, priority projects will include pedestrian traffic signals, new sidewalks, Greenways, bike network, wheel chair ramps and bus stops and shelters.

Bicycles/Greenways

The Vancouver Comprehensive Bicycle Plan (1988), the Clouds of Change Report (1990), the Citywide Bicycle Network (1992) and the recent Greenways Program, established the City's policy of promoting and encouraging cycling as a transportation alternative. On July 18, 1995, Council approved the Vancouver-Greenways Plan. This plan supports environmental initiatives such as Clouds of Change and Council's top transportation priorities, as approved in CityPlan, pedestrians and bicyclists. Greenways also address the growing needs on the part of communities to have a voice in the design and use of the urban landscape.

Sidewalks

It is Council policy to give sidewalks high priority, and to provide walks on:

-both sides of arterial streets;

-one or both sides of pedestrian collector routes as required;

-both sides of streets in multiple dwelling, commercial and industrial zones;

-in residential areas as requested by petition;

-adjacent to parks, schools and other exempt property, as funding allows.

Transit

The CityPlan direction for Transit, Walking and Biking as a priority calls for making better use of existing streets for buses and implementing HOV lanes and other measures to provide priority for transit users.

Safety and Congestion

The City has a policy of improving traffic safety at intersections.

Neighbourhood Traffic Controls

The City has a policy of protecting neighbourhoods from shortcutting with the installation of traffic controls such as traffic circles, diverters, and right-in/right-outs etc.

STREET LIGHTING

The Safer City Task Force indicated the importance of making the public feel secure. This involves taking proactive measures to provide appropriate street and bus shelter lighting to assist in the protection of citizens from theft and violence. The Infill Lighting program funds the improvements to low levels of lighting on residential streets and around bus shelters.

SEWERS

In the early 1970's, Council approved the policy of separating sanitary and storm sewers, starting in the West End and Downtown areas, in order to begin reducing and eliminating combined sewer overflows.

In 1981, the above-noted policy was reaffirmed with the adoption of the 1% life cycle replacement policy for sewer mains as part of the Sewers Long Range Capital Plan.

Both of these policies were reaffirmed in the 1991 Policy Report on Vancouver’s "Design and Service Level Standards for Sewer Collection Infrastructure," and have been reaffirmed as part of every Capital Plan since.

CityPlan direction is to make environmental improvements a priority in decision-making with particular attention to air and water quality. One CityPlan step is to reduce combined sewage overflows to surrounding water bodies by continuing to separate storm runoff and sewage systems.

WATERWORKS

In September 1996, Council approved the 1997-1999 Waterworks Capital Plan, which was based on the Waterworks Long Range Plan (LRP). The LRP and Capital Plan focus on the issues of uniform replacement of aging infrastructures, replacement of water services and meters, system capacity and fire protection improvements, emergency preparedness, and other works such as new water service installations.

In April 1992, Council approved the construction of the Dedicated Fire Protection System, including saltwater pumping stations, a downtown distribution grid, and a pipeline extension to Kitsilano, subject to funding approval in subsequent Capital Plans.

SUMMARY & PURPOSE

This report provides Council with an overview of the 1998 Engineering Department Basic Capital Budget, including submissions for:

Streets $ 17,478,000

Communications $ 250,000

Street Lighting $ 1,531,000

Sewers $ 16,165,000

Waterworks $ 23,850,000

TOTAL $ 59,274,000

The General Manager of Engineering Services will report separately on the details of the 1998 Traffic Signal Program ($720,000) to the Transportation and Traffic Committee.

The 1998 Basic Capital Budget, the second year of the 1997-1999 Capital Plan, allocates approximately one-third of the Capital Plan funds approved by Council in November 1996.

This report also includes Capital account closeouts for Waterworks and Sewers, as detailed in Appendix 2.

ENHANCED CANADA/B.C. INFRASTRUCTURE WORKS PROGRAM AND OTHER COST SHARING PROGRAMS

City Council approved a prioritized list of hard infrastructure projects for application to the Enhanced Canada/B.C. Infrastructure Works Program on April 22, 1997. Engineering submissions included road, bridge and transit projects totalling $5.8 million, and a $5.0 million sewer project. In addition, the Provincial Government submitted on the City’s behalf, applications for cycling projects totalling $1.8 million that had already been submitted to their Cycling Network Program. The Provincial Government also made numerous submissions on its own behalf for highway and transit projects.

In July of 1997, the first round of project awards were announced, and accounted for $58 million out of the program’s $140 million in total hard infrastructure funding. The majority of this funding ($52 million) went to Provincial highway and transit projects. The City received program awards for the Elliott/Slocan bike route ($530,000) and the Beach Avenue bike route ($310,000). We were also notified that the remaining cycling applications would not receive any funding, and our sewer application would not be considered.

The status of the City’s remaining applications for road, bridge and transit projects is still uncertain. Under the original program announcement, all projects awarded funding were to be completed by the end of March 1998. However, this was under the assumption that the project awards would have been announced in time for work to be carried out during the 1997 Summer and Fall construction season. The Senior Governments have not been able to come to agreement on the remaining project awards, except for some northern road projects totaling $10 million.

In August, 1997 it was announced that due to the delays in funding awards, the completion date for approved projects was extended one year until the end of March 1999. Currently, it is not known when the remaining awards will be made or whether there will be any significant funding for municipal transportation projects. The Union of BC Municipalities (UBCM) is currently involved in a review of the list of recommended projects that the Province forwarded to the Federal Government. In the event that the City does receive an award later in 1998, staff will report back to Council.

We have also received notification of funding from the BC Cycling Network Program, the National Trans-Canada Trail and ICBC Safety Programs. Staff will be reporting back to Council when funding is received from any of these programs.

PROJECT DETAILS

The 1998 Engineering Basic Capital Budget consists of five programs: Streets, Communications, Street Lighting, Sewers, and Waterworks. These are summarized in this report, and described in detail in Appendix 1. Funding for the 1998 Traffic Signal Program ($720,000) is included in the 1998 Streets Capital Budget. The 1998 Traffic Signal Program Report, which details the allocation of funding, will be presented to the Transportation and Traffic Committee in early 1998.

A. STREETS 1998 Budget $ 17,478,000

The 1998 Streets Capital Budget comprises a number of programs which address Council's Capital, CityPlan and Transportation Plan priorities. A brief description of the Streets programs follows:

Infrastructure $2,980,000

This program addresses the need for reconstruction of arterial streets and local streets which have deteriorated to the point where normal maintenance is not effective. Also, included in this category is the major maintenance of City bridges, including concrete repairs and joint replacement.

Pedestrians, Bicycles & Greenways $3,243,000

This program provides for pedestrian and cycling priorities. The construction of new sidewalks and curb ramps, and sidewalk reconstruction are addressed. Both of these areas include cost-sharing with property owners, and some projects may be fully City funded. In this budget additional funding is being allocated the Curb Ramp and Sidewalks - Partial Blocks programs to reflect increased needs. This increase has been offset by a reductions in the needs and funding in the Local Improvement - Sidewalk Reconstruction program. In the New Sidewalk construction program, the majority of the arterials are now complete and construction is concentrating on pedestrian collector routes in residential areas.

The construction of the City's Bicycle Network is significantly underway. The projected completion of the Network has been accelerated as a result of Senior Government funding. A report will be brought forward to Council in 1998 providing the overall status of the Bicycle Network and the time line for outstanding links and upgrades. Proposed cycling improvements in 1998 include the development of the English Bay Bike Route, the Sunrise (Slocan/Elliott) Bikeway, and other bicycle network improvements. Senior Government funding of $560,000 was received by the City as part of the Enhanced Canada/BC Infrastructure Works Program for the two bike routes identified above. Further development of the citywide Greenways system will continue, which will include several neighbourhood Greenways projects.

Traffic Signals $1,500,000

The 1998 Streets Capital Budget provides funding for the Traffic Signal program. This section includes the funding for the 1998 Traffic Signal Program for the installation and updating of traffic signals. Details of this program will be reported separately to the Transportation and Traffic Committee by the General Manager of Engineering Services. This program also contains funding for miscellaneous signal modifications, upgrading and retrofitting existing traffic signals, including pedestrian indicators, audible signals and left-turn phasing and a program to renovate and replace traffic signal infrastructures.

Transit & Safety Improvements $ 2,630,000

This program provides funding to address various transportation priorities to enhance transit and improve safety. Projects in this program include implementing HOV Lanes and left-turn bays to augment transit operations and reduce delays, and other roadway changes to improve safety and reduce shortcutting through neighbourhoods. After a public consultation process, the individual projects are reported to Council for approval. Major projects scheduled for construction in 1998 include Knight St @ 41st Ave, Arbutus St @ 12th Ave and Fir St @ Broadway & 10th Ave. This program also includes arterial local improvements, bus shelters and bus slabs and landings.

Local Area Traffic Plans

and Other Improvements $ 4,125,000

This program addresses the installation of neighbourhood traffic controls and construction of streets and lanes by Local Improvement petitions or initiatives. Neighbourhood Transportation Plans and local street traffic calming measures are integral components of the Transportation Plan. There has been an increasing demand for these measures on local streets over the past few years. These projects include public consultation and the installation of traffic circles, bulges, diverters, and other traffic calming measures. In the Local Improvements area, Residential Lane Paving petitions have increased and Residential Street Paving petitions have decreased. The 1998 Budget has reflected their needs accordingly.

Major Projects $ 3,000,000

The 1998 Capital Budget will provide funding for the final payment toward the property purchase of the CP Rail False Creek Corridor for the Downtown Heritage Railway.

B. COMMUNICATIONS 1998 Budget $250,000

The City's communications system is made up of Fire, Police and Engineering radio dispatch systems as well as a communications cable network. An effective communication system is essential to the efficient operation of these departments. This system is essential to all aspects of emergency response and, therefore, it must have an eminent degree of survivability.

The 1998 Capital Budget contains funding for the continuation of the Underground Cable Plant replacement and expansion programs.

C. STREET LIGHTING 1998 Budget $1,531,000

The street lighting plant is aging and many components are now past their estimated service life, similar to a majority of the City’s infrastructure. The 1998 Street Lighting Capital Budget addresses the need for an ongoing infrastructure replacement program for street lighting such as street lighting poles, service panels and conduit. It also addresses street lighting outages through rebuilding some electrical connections and control panels.

In 1998, funding is provided to address local public safety concerns regarding street, lane and bus shelter lighting brought forward through both the Safer City Task Force and community interaction. In response to an increase in requests from the public and the police, we are accelerating these programs in 1998 by re-allocating existing funding that is available in Undergrounding Overhead Utilities.

Funding is also provided for street lighting relocations in coordination with other utility companies’ replacement programs. The City's share of new lighting projects approved through the Local Improvement process is also funded from the 1998 Capital Budget.

To properly address the ongoing replacement of the street lighting infrastructure system and new priorities such as safety issues, we are recommending that an existing temporary Electrical Technician position be made permanent, to be funded within the existing overhead loading rate on Street Lighting capital projects. This is discussed in greater detail in the "Personnel Implications" section on page 14 of this report.

D. SEWERS 1998 Budget $16,165,000

The Sewers program includes the following:

System Replacement $15,355,000

The 1998 Sewers Capital Budget is a continuation of an ongoing infrastructure program that began in the early 1970's. This program consists of the renewal of sewer mains, connections, manholes, street drains and pump stations. Factors considered in selecting the projects in this category are: replacements for physical failure, deterioration from age, inadequate capacity and related flooding problems, and environmental benefits. The City has adopted a strategy of continuous sewer replacement to replace 1% of the existing sewer system over a 100-year life instead of periodic large reconstruction programs. The benefits of this strategy include:

-it avoids crisis funding and spreads the cost of Capital replacement works to taxpayers more evenly over time,

-provides for continuous environmental improvements,

-maintains a stable, well-trained workforce,

-maintains an adequate level of service in sewers by providing for the ongoing, timely replacement of older sewers and thus reducing the risk of sewer collapse and sewage flooding of private residences and businesses,

-meets the City's combined sewer overflow (CSO) management goal of gradual reduction and eventual elimination over about 60 years.

The City's ongoing commitment to the sewer separation program has been one of the key factors in the Province's support for our approach to dealing with CSO's. It may also have been a significant consideration in the Province's decision to stay charges against the GVRD for ongoing CSO's at the Clark Drive outfall.

System Management $ 300,000

The system management programs provide funds to support a variety of information and research projects. These projects provide key information that is used to prioritize our 1% replacement program and establish routine maintenance programs. This program also provides funds for a variety of tools that support cost-effective capital work programs, including sewer system modeling, field monitoring of sewer flows, construction site exposures, soundings of underground facilities, and investigation of new products and technical standards for sewer design and construction.

Pollution Abatement $ 510,000

The program addresses pollution abatement projects such as Inflow/Infiltration Reduction, which involves flow monitoring, dye testing, smoke testing, and other field investigations to locate the sources of and reduce storm water entering and adversely affecting our sanitary sewer system. This program also includes the Sewer Separation on Private Property Program which was established by Council in 1978 in order to achieve the pollution control benefits of a separated sewer system. The major benefit of this program has been a reduction in the faecal coliform levels in waters that are adjacent to the City.

Sewer Connection Fees for 1998

Fees for public sewer connections are reviewed annually and adjusted as necessary to reflect actual costs incurred in the previous year as well as anticipated inflationary increases in the next year. Accordingly, a fee increase of 1% is recommended for 1998 (refer to submission D-1 and Appendix 3 for details).

F. WATERWORKS 1998 Budget $23,850,000

The 1997-1999 Capital Plan is based on the Waterworks Long Range Plan (LRP), updated with our more recent Storage and Transmission Optimization (STOR) work. The Waterworks 1997-1999 Capital Plan was approved by Council in September 1996, with increased annual expenditures compared to past Waterworks budgets. This funding was intended to address a number of significant deficiencies in the Waterworks system.

Implementation of the Long Range Plan was initially planned to be eight years, but was extended to 12 years to reduce its financial impact. Subsequent coordination with the GVRD, through the STOR project, also resulted in the deferral of the storage (reservoir) project envisioned in the LRP. The 1997-1999 Capital Plan reflects this change and proposes watermain projects which are required independent of whether or not the city ultimately builds its own emergency storage facilities.

The 1998 Waterworks Capital Budget is composed of the following:

Aging Infrastructure Replacement $ 14,300,000

This program addresses the aging infrastructure of the City’s waterworks system. Aging pit cast iron and lined cast iron distribution mains and steel pipe transmission mains are identified and replaced. Waterworks annual work programs result in a replacement rate of about 1.5% per year, as necessitated by system aging. This program also includes the reconstruction of Pressure Reducing Valve stations, which control the water pressure in the City's eight pressure zones. Water meters and service pipes that have worn out due to corrosion, and fire hydrants are also replaced in this program.

Addressing Growth $ 1,650,000

This program involves the replacement or extension of transmission mains in various areas throughout the City to address pressure and fireflow problems, due to historic and continuing City and Regional growth. Funding is also included for cost-shared distribution system improvements to accommodate specific developments' local water system improvements.

Other Works $1,800,000

The main components of this program include the installation and replacement of telemetry (monitoring) equipment, construction and replacement of mains prior to paving or on short notice, and installation of new services and meters. As of 1997, new water services are funded by the City only when they are required for residential fire sprinkler installations for secondary suites. This has reduced the annual "New Services and Meters" portion of the budget from $1.75 million in 1996 to $600,000 in 1998. The budgets for this category are based on projected demand and are subject to market fluctuations. The approved 1997-1999 Capital Plan assumed higher cost recoveries for discontinuing services; to account for revised anticipated cost recoveries and to keep the 1998 budget within the approved Capital Plan, funding for meters has been maintained by reallocating some funding from the 1997-1999 Pressure Reducing Valve program budget.

Emergency Planning $6,100,000

The majority of funding in this category is for the Dedicated Fire Protection System (DFPS). In April 1992, City Council approved an 8- year implementation schedule for the construction of the DFPS. This was extended to a 12-year schedule as a result of funding limitations. When completed, this system will consist of three pump stations, using either salt water or potable water, and a dedicated distribution grid of large diameter, high pressure, watermains. To date, the False Creek and Coal Harbour pump stations and the construction of three kilometers of pipeline between them is complete.

The 1998 program will include funding to purchase 3 kilometers of steel pipe material, design and construction of approximately 1.7 kilometers of pipe, as well as funding for the fourth, of four, hose tender support vehicles for the Fire Department.

In 1997, Engineering Services undertook a Value Engineering study of the Dedicated Fire Protection System program. The results of the study and recommended alternatives will be reported to Council shortly. The 1998 DFPS construction program is included in all of the alternatives.

Minor funding is also included in this category for the evaluation and development of other alternative water supplies such as groundwater sources, and access to Fraser River water.

PERSONNEL IMPLICATIONS

To properly address the ongoing replacement of the street lighting infrastructure system and new priorities such as safety issues, the 1994-96 Street Lighting Capital Plan represented a significantly higher level of capital construction than the 1991-93 Plan. To support the additional design work, a temporary Electrical Technician position in the design branch was approved for three years as part of the 1994 Capital Budget Report

The funding level for the 1997-1999 Street Lighting Capital plan is consistent with the previous plan, and this level of funding is anticipated to continue in future Street Lighting Capital Plans. We have continued to monitor the state of the street lighting infrastructure and the past 5 years have shown an accelerating rate of deterioration. Staff have reviewed what resources are required to undertake this work and believe that the programs can be completed without any increase in the existing design and administrative staff levels, if the Electrical Technician position that was temporary is retained. Therefore, we are recommending that the existing temporary Electrical Technician position be made permanent, to be funded within the existing overhead loading rate on Street Lighting capital projects.

FUNDING

As shown in Table 1, funding for Streets, Communications and Street Lighting is partially from Operating Budget revenues and partially from borrowing authority approved by voters in the November 16, 1996 plebiscite. Funding for Sewers originates from Council approved borrowing authority, and Waterworks is a Council approved, self-funding utility with debt financing through water rates revenue.

There are several projects contained in the 1998 Engineering Capital Budget, such as bike routes, traffic signals, neighbourhood traffic plans, etc., that will require various forms of maintenance in the future. Increases that may be required to the Engineering Operating Budget for these maintenance items will be identified with the individual projects as they are reported to Council.

TABLE 1

000'S DOLLARS

Program 1997-99 Previously 1998 Remaining 1998 Funding From

Funding Approved Budget Funds Borrowing Revenue

Streets	$ 55,680	$ 21,641	$ 17,478	$ 16,561	$ 14,478	$ 3,000
Communications	$ 960	$ 465	$ 250	$ 245	$ 250	$ 0
Street Lighting	$ 4,373	$ 1,540	$ 1,531	$ 1,302	$ 1,531	$ 0
Sewers	$ 49,417	$ 16,660	$ 16,165	$ 16,592	$ 16,165	$ 0
Waterworks	$ 74,100	$ 23,100	$ 23,850	$ 27,150	$ 23,850	$ 0
Total Engineering	$184,530	$ 63,406	$ 59,274	$61,850	$ 56,274	$ 3,000

CAPITAL CLOSEOUTS

Every year, Capital projects are reviewed to determine accounts that can be closed out. Closeouts of completed Capital projects involving transfers between Capital accounts of $50,000 and 15% of the budget, or more, require Council approval. Appendix 2 provides a summary of the 1998 Waterworks and Sewers closeouts, including a calculation of their under and over expenditures, respectively. The transfers requiring Council approval are noted.

* * * * *

Appendix 2

Capital Account Close-Outs

Section A - WATERWORKS

To close and balance the accounts for the 1994-1996 Waterworks Capital Plan work completed before January 1, 1998, the following summary has been prepared. The accounts that are being closed represent projects for which, as a group, funding and expenditures occurred over the period of the 1994-1996 Capital Plan. Included in this funding are carry-forward budgets from the pre-1994 Capital Budget close-out that was included in the 1995 Capital Budget Report. Accordingly, no direct comparison exists between the closeouts and the 1998 Waterworks Basic Capital Budget. This closeout addresses the 1994 to 1996 Waterworks Capital program, including all accounts in Fund 17 - Agency 35 (Waterworks) and Fund 18 - Agency 03 (Dedicated Fire Protection System).

These account summaries are based on Cycle 13, December 31, 1997 Capital Expenditures Statement. As detailed below and summarized at the end of this document, existing funding required for continuing programs will be carried forward to the 1997 - 1999 Waterworks Capital Plan for continuation of such programs. Some surplus funds for particular programs will be reallocated to balance shortfalls in other Waterworks programs within Funds 17 and 18, and the net surpluses will be transferred forward as unallocated Waterworks 1997 - 1999 Plan funding. Funding was included in the 1997 Waterworks Capital Budget to contribute to a portion of the DFPS closeout.

The following is a summary of the Waterworks 1994 - 1996 closeout:

Acct. Series Budget Expenditures Balance Variance

17/35/ $41,036,627 $ 36,515,297 $ 4,521,330

18/03/ $17,452,500 $ 19,061,927 ($1,609,427) $58,489,127 $ 55,577,224 $ 2,911,902 4.98%

The account closeout details for each category of work are shown below. Explanations are provided where variances are greater than $50,000 and 15% of the budget:

Program		Budget		Spent		Balance		Variance
WATERWORKS
Distribution Main Replacement		$ 11,110,000		$ 10,801,300		$ 308,699		2.8%		1
Fire Protection Program		$ 2,400,000		$ 2,374,046		$ 25,953		1.1%		2
650 Zone Upgrading		$ 4,800,247		$ 4,818,674		$ (18,427)		(0.4%)		3
Misc & Short Notice		$ 1,280,000		$ 1,016,765		$ 263,234		20.6%		1
Transmission Mains		$ 1,540,000		$ 842,737		$697,262		45.3%		2
Engineering & Site Invest		$ 330,000		$ 114,590		$ 215,409		65.3%		2
Minor Improvements		$ 675,000		$796,856		$ (121,856)		(18.1%)		3
Fire Hydrant / Air Valve Program		$ 1,744,760		$ 1,641,868		$ 102,891		5.9%		1
Drafting Stations		$ 378,620		$ 41,056		$ 337,563		89.2%		2
PRV Stations		$ 4,000,000		$ 2,512,541		$ 1,487,458		37.2%		2
Telemetry System		$ 750,000		$ 530,047		$ 219,952		29.3%		2
Storage & Optimization		$ 663,000		$ 360,425		$ 302,575		45.6%		2
Replace Meters & Services		$ 4,500,000		$ 4,253,737		$ 246,262		5.5%		1
Additional Charges on Compl Jobs		$ 0		$ 159,839		$(159,839)				3
New Services & Meters		$ 7,300,000		$ 6,314,559		$ 985,440		13.5%		1
Provincial Revenue Sharing		$ (435,000)		$ (63,750)		$(371,250)				3
Total - Fund 17		$ 41,036,627		$ 36,515,297		$ 4,521,330		11.0%
Dedicated Fire Protection
Funding Provided 04/24/90		$(300,000		$(300,000)		$ 0
Furniture & Computers		$ 20,000		$ 20,529		$ (529)		2.6%		3
Consultants		$		$ 2,699,985		$ 226,702		7.7%		2
Coal Harbour Pump Station		$		$ 4,725,353		$ 36,968		0.7%		2
False Creek Pump Station		$		$ 4,951,535		$ (203,526)		(4.3%)		3
DFPS System Pipeline		$		$ 7,330,156		$		(28.0%		3
Grouse Mountain Repeater		$ 345,000		$ 409,367		$ (64,367)		(18.6%		3
DFPS - Revenue Sharing		$		$ (775,000)		$ 0
Total - DFPS (Fund 18)		17,452,50		$19,061,927		$(		(9.0%)
TOTAL FUND 17		$		$		$ 4,521,330
TOTAL FUND 18		$		$		$(1,607,427
TOTAL CLOSE-OUT		$		$		$ 2,911,902

NOTE:¹ funding to be carried forward to same program in 1997-99 Waterworks Capital Plan.

² funding to be allocated to Waterworks Unallocated.

³ overexpenditure to be funded from Waterworks Unallocated.

SUMMARY OF WATERWORKS CLOSEOUT

Programs with POSITIVE Balances:

to be Carried Forward to 1997-99 Programs: $ 1,906,528

to be Allocated to WATERWORKS - UNALLOCATED $ 3,549,845

SUB-TOTAL #1: Programs with POSITIVE Balances $ 5,456,373

Programs with NEGATIVE Balances:

Waterworks Programs $ 671,373

DFPS Programs $ 1,873,098

SUB-TOTAL #2: Programs with NEGATIVE Balances $ 2,544,471

Funding Sources for NEGATIVE Balances:

WATERWORKS - UNALLOCATED $ 1,844,471

1997 DFPS Capital Budget $ 700,000

SUB-TOTAL #3 - $ 2,544,471

Total of Programs with POSITIVE Balances $ 5,456,373

Net Total of Programs with NEGATIVE Balances

to be funded from UNALLOCATED $(1,844,471)

$ 3,611,902

to be Carried Forward to 1997-99 Programs: $ 1,906,528

to be Allocated to WATERWORKS - UNALLOCATED $ 1,705,374

$ 3,611,902

DFPS Funding from 1997 Capital Budget $( 700,000)

NET CLOSE-OUT $ 2,911,902

Explanations are provided where variances are greater than $50,000 and 15% of the budget as follows:

I. Account Series 17/35/:

Distribution Main Replacement

Budget $11,110,000 Balance $308,699 Variance 2.8%

These programs address the life-cycle replacement of pit cast-iron, lined cast-iron, and steel distribution mains (12-inches and smaller in diameter). The underexpenditure is due to savings achieved by grouping jobs into neighbourhoods to reduce crew relocation costs and by doing more detailed designs to reduce delays due to unexpected utility conflicts during construction. The balance will be carried forward into the 1997 - 1999 Distribution Main program.

Miscellaneous & Short Notice New & Replacement Mains

Budget $1,280,000 Balance $263,234 Variance 20.6%

This program provides funding for unanticipated small main installations due to failures and on short notice due to paving projects, or when other opportunities arise to minimize the long term disturbance of a street by accelerating a watermain’s replacement. As the work is opportunistic, it is difficult to predict how many projects will be undertaken, but the underexpenditure represents one typical size job for this program. The balance will be carried forward to the 1997 - 99 program.

Transmission Mains

Budget $1,540,000 Balance $697,262 Variance 45.3%

This program funds the installation of large diameter (16-inch and greater) watermains both to replace aging infrastructures and to address growing demands. Several of the projects originally proposed for the 1994-96 Waterworks Capital Plan were deferred as a result of project optimization with the GVRD during the City’s Storage and Transmission Optimization Review (STOR). The balance will be reallocated to Waterworks - Unallocated.

Additional Charges on Completed Jobs

Budget $ 0 Balance $(159,839)

This account provided funding for miscellaneous expenditures that occurred after projects were completed in the past few years. The overexpenditure will be funded from Waterworks - Unallocated.

Engineering & Site Investigation

Budget $330,000 Balance $215,409 Variance 65.3%

Funds are budgeted annually for engineering and site investigations for product evaluation, minor research required for project planning and in response to lawsuits. This category was significantly underspent because no significant lawsuits arose during the 1994-96 Waterworks Capital Plan and most investigation and research was separately funded by the STOR project. The balance will be reallocated to Waterworks - Unallocated.

Minor Improvements to the System

Budget $675,000 Balance $ (121,856) Variance (18.1%)

This program provides funding for minor works not associated with particular capital programs. Examples include valve chambers, short watermain extensions, and water quality monitoring stations. Similar to the Miscellaneous & Short Notice program, this work is generally unpredictable. The overexpenditure represents one unanticipated project and will be funded from Waterworks - Unallocated.

Fire Hydrant/Air Valve Program

Budget $1,744,760 Balance $102,891 Variance 5.9%

This program replaces substandard fire hydrants (those with poor flow characteristics and corroded leads, resulting in low pressures during high demand times of the year) in locations where the watermains are not due for replacement. It also upgraded older air valves to current backflow prevention standards. After detailed design was performed, the number of air valves that required upgrading was significantly less than originally planned. As a result, this portion of the program was underspent during the 1994-96 Waterworks Capital Plan. The balance will be carried forward to the 1997-99 Fire Hydrant program.

Drafting Stations

Budget $378,620 Balance $337,563 Variance 89.2%

The construction of a second firefighting drafting ramp along the Fraser River was proposed as part of the 1994-96 Waterworks Capital Plan. During the Capital Plan a study was undertaken to reconsider the best options for drafting Fraser River water and the development of a prototype portable pump was initiated. As a result of this study, the direction of this emergency planning program has changed and therefore the level of funding has been decreased. The balance will be reallocated to Waterworks - Unallocated.

PRV Stations

Budget $4,000,000 Balance $1,487,458 Variance 37.2%

During the 1990’s the City has been systematically replacing its Pressure Regulating Valve Stations which are beyond their useful service life. The replacement of several stations was deferred during the STOR study to ensure that the pressure zone boundaries (where the PRV’s are located) would not change as a result of transmission system optimization. Also, costs were reduced by refitting several stations rather than completely rebuilding them, and very competitive construction contracts lowered costs compared to the design consultant’s estimates for several stations. The balance will be allocated to Waterworks - Unallocated.

Telemetry System

Budget $750,000 Balance $219,952 Variance 29.3%

This program funds the gradual replacement of old hardwired pressure and flow monitoring equipment, and the addition of new monitoring points where required. Significant cost savings were achieved by using the same radio-based system as implemented for the DFPS. The balance will be reallocated to Waterworks - Unallocated.

Storage & Transmission Optimization (STOR)

Budget $663,000 Balance $302,573 Variance 45.6%

The Storage and Transmission Optimization Review was a major study undertaken to plan the long term needs for water system upgrading to address growth. Phase I of the study suggested that the design and construction of a major City-owned storage reservoir may be required to address system demands by the year 2006. Funding was included in Phase II to begin design of that reservoir. However, further study and optimization of the City and District’s water system plans deferred the need for the reservoir and saved approximately half of the anticipated study cost. The balance will be reallocated to Waterworks -Unallocated.

Replacement of Meters & Services

Budget $4,500,000 Balance $246,262 Variance 5.5%

This program replaces aging water meters and water service lines, as part of our overall infrastructure replacement program. The meter replacement portion of the program was hindered during the last half of the Capital Plan by the discontinuation of the type of meters we were installing. Some of the planned work was delayed while we evaluated which new meter technology to adopt. The balance will be carried forward to the 1997-99 program so that the delayed work can be completed.

New Services & Meters

Budget $7,300,000 Balance $ 985,441 Variance 13.5%

These accounts fund the program for the installation of all new water services and meters for new buildings constructed in the City. The costs of commercial water services are recovered from the developers, but single-family dwelling services were cost-shared by the City (until 1997), and meters are owned by the City. The balance in this group of accounts represents water services which were paid for in 1996 but not installed until 1997, and some cost saving due to improved installation methods such as shared trenches with other utilities. It is recommended that the funds be carried forward into the same series of Waterworks 1997-99 accounts, to fund the carryover work.

Provincial Revenue Sharing

Budget $(435,000) Balance ($ 371,250)

In June 1990, as part of the 1990 Provincial Revenue Sharing Program, the City requested and received a $371,250 grant for Phase II of the construction of a transmission watermain on 12th Avenue at Clark Drive. In 1992, the City requested that this grant be re-allocated to the Revenue Sharing that was received for Phase I of this project, as higher than anticipated costs on Phase I delayed the implementation of Phase II. In May 1993, we received notification from the Province that our request for re-allocation was not approved. The City appealed this decision in September 1993 and, in March 1995, we were requested to forward all pertinent background information to the Province for further review. On April 28, 1995, the Province notified us that the appeal was denied. On May 23, 1995, we wrote another letter requesting a further review of their decision, to which no reply was received. In September 1995, Dave Rudberg and Tom Timm met with the Ministry of Municipal Affairs to review the Provincial Revenue Sharing Program. The issue of the outstanding grant was raised, and we were instructed to forward our concerns. This was done in January, 1996, however, the Province denied our appeal again. As no waterworks Revenue Sharing funds have been received since 1992, we are now closing out this account. The under-recovery will be funded from Waterworks - Unallocated.

II. Account Series 18/03 (Dedicated Fire Protection System):

Consultants

Budget $2,926,688 Balance $226,702 Variance 7.7%

These accounts fund the design and construction supervision of the three planned DFPS pump stations; False Creek, Coal Harbour and Kitsilano. An overexpenditure exists for both Coal Harbour and False Creek designs due to unforeseen extra work to accommodate the False Creek station in David Lam Park as well as extra work required to complete the Coal Harbour station in time to accommodate completing Hastings Street in the Marathon lands. The preliminary design and construction of the pump station in Kitsilano has been postponed and, as a result, significant funds remain. The balance will be reallocated to Waterworks -Unallocated.

Coal Harbour Pump Station

Budget $4,762,322 Balance $36,968 Variance 1.5%

This program funded the construction of the Coal Harbour Pump Station, salt water intake structure, and associated dredging. The balance will be reallocated to Waterworks -Unallocated.

False Creek Pump Station

Budget $4,748,009 Balance ($203,525) Variance (4.3%)

This program funded the construction of the False Creek pump station and salt water intake structure in David Lam Park. The overexpenditure is the result of unanticipated costs to fit the station within the Park. An area for public washrooms was added on to the sides of the station which resulted in the station being larger than originally anticipated. A higher level of architectural detail was also required given that station is partially exposed within the park as opposed to the original concept which had the station completely buried. The overexpenditure will be funded from Waterworks - Unallocated.

Grouse Mountain Repeater Station

Budget $345,000 Balance ($64,367) Variance (18.73%)

This account funded the reconstruction of the City's repeater station on Grouse Mountain which is critical for DFPS communications and was seismically vulnerable. The overexpenditure is due to unforeseen geotechnical conditions requiring a larger foundation than anticipated and early, heavy snowfalls which caused delays in construction completion. This overexpenditure will be funded from Waterworks - Unallocated.

DFPS - Distribution System

Budget $5,725,481 Balance ($1,604,675) Variance (28.0%)

These accounts funded the purchase of the pipe and materials for the pipeline linking the False Creek pump station to the Coal Harbour pump station, as well as the installation of half of that pipeline and associated appurtenances in 1996. The accounts also included funding for the DFPS SCADA system. The overexpenditure is due to unanticipated difficulties in constructing the pipeline in the hard till at the design depth, as well as a bulk excavation and replacement of poor soils between the False Creek pump station and Pacific Boulevard. The high costs of this pipeline instigated a review of the design through a Value Engineering process conducted in the fall of 1997. This process has resulted in design changes and the results will be formally reported to Council early in 1998. This overexpenditure will be funded from Waterworks - Unallocated.

SUMMARY

The 1994-96 Dedicated Fire Protection System program represents a significant portion of program deficits identified in the 1994-96 account closeouts. This overexpenditure was forecast during the preparation of the 1997 Waterworks Capital Budget and funding was allocated to assist in balancing the close-out. Underexpenditures were experienced in other programs as a result of the DFPS. The DFPS system reduced the need for transmission system upgrades (by reducing the need for transmission redundancy for emergency firefighting), and significant cost savings were achieved in the Telemetry Program by using the same radio based system as implemented for the DFPS. Surplus transmission main and telemetry funds will be directed to Waterworks - Unallocated to address some of the shortfall in the 1994 - 96 Dedicated Fire Protection System accounts.

As a result of delays in the design and construction of a pump station in Kitsilano and the revised emergency plan that postponed further Fraser River drafting stations, there are significant funds remaining in these areas. It is recommended that these funds also be used to address the DFPS shortfall.

Other programs in the Waterworks 1994-96 Capital Plan that have experienced overexpenditures will have the overexpenditures addressed from funding from various programs that has been reallocated to Waterworks - Unallocated.

Appendix 2

Capital Account Close-Outs

Section B - SEWERS

To close and balance the Grandview-Woodlands Sewers Infrastructure Replacement Program accounts for the 1994-1996 Sewers Capital Plan work completed before January 1 1998, the following summary has been prepared. The accounts that are being closed represent projects for which, as a group, funding and expenditures occurred over the period of the 1994-1996 Capital Plan. Accordingly, no direct comparison exists between the closeouts and the 1998 Sewers Basic Capital Budget.

In 1994, the City received a Federal Infrastructure Program award of $12.0 million for reconstruction of sewers in the Grandview-Woodlands area (Project #M95IW0255). The Federal and Provincial Governments contributed $8.0 million towards the project and $4.0 million was approved from Sewers Capital borrowing. To carry out the work, the City issued two major contracts and hired an additional sewer construction crew. This work was completed over a 27 month period ending early in 1997. The final cost of the program was $12,495,817 (4.1% over budget). Payments have been received from the Federal and Provincial Governments totalling $8.0 million, and the existing Sewers Capital Budget has funded $4.0 million, leaving an overexpenditure of $495,817. It is recommended that the over expenditure be funded from Sewers Capital funds in account number 11/03/0875/941 -System Replacement - Unallocated from pre-1997 Plan.

Account # Description Budget Spent Balance

11/03/0050 Federal Infrasatructure Program

11/03/0050/454 Revenue Sharing ($8,000,000) ($8,000,000) $ 0

11/03/0051/999 Grandview Woodlands Sewers $12,000,000 $12,495,817 $(495,817)

Total $ 4,000,000 $ 4,495,817 $(495,817)

APPENDIX 3

Sewer Connection Fee Increases for 1998

Current Recommended

Fee Fee - 1998

Public Sewer Connection Fees for

One & Two Family Dwellings........... $ 4,310 $ 4,350

Public Sewer Connection Fees for

other than One & Two Family Dwellings:

4 inch/100mm Diameter............. $ 5,630 $ 5,690

6 inch/150mm Diameter.............$ 6,800 $ 6,870

8 inch/200mm Diameter.............$ 7,690 $ 7,770

10 inch/250mm Diameter............$ 8,880 $ 8,970

12 inch/300mm Diameter............$ 10,090 $ 10,190

15 inch/375mm Diameter............$ 11,280 $ 11,390

Manhole installed in conjunction

with a Public Sewer Connection........$ 3,390 $ 3,420

Connections greater than

15 inch/375mm Diameter................$ 11,280 $ 11,390

New Fittings - Twin Sewer............. $ 2,080 $ 2,100

New Fittings - Single Sewer........... $ 910 $ 920

Inspection fee for Connection

to a Public Sewer.....................$ 120 $ 120

* * * * *

(c) 1997 City of Vancouver