ADMINISTRATIVE REPORT

Dated: May 10, 1999
Author/Local: J. Beresford 7789
RTS #00728
C.C. File No. 1602
CS&B Date: May 20, 1999

TO: Standing Committee on City Services and Budgets

FROM: Director of Finance

SUBJECT: 1999 Supplementary Capital Budget

RECOMMENDATIONS

THAT the projects identified as RECOMMENDED in Appendix 1 and totaling $1,022,000, be approved; source of funds to be the 1999 Supplementary Capital Budget.

GENERAL MANAGER'S COMMENT

The General Manager of Corporate Services RECOMMENDS approval of the foregoing.

COUNCIL POLICY

It is Council policy to identify capital funding priorities in three year Capital Plans. These Plans and the associated Capital Financing Plan are developed such that the plan and necessary borrowing authority can be put to the voters at the time of triennial civic elections.

The 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/program - specific items that were included in the Capital Plan, and
· Supplementary Capital, which includes items which had not been anticipated in the Capital Plan but which have become a priority during the course of the Plan.

PURPOSE

The purpose of this report is to review the requests for funding from the 1999 Supplementary Capital Budget and to forward the recommended projects to Council for approval.

BACKGROUND

The City's Capital Plan normally provide two types of funding:

· Basic Capital provides for those projects and on-going programs that can be planned in advance,
· Supplementary Capital deals with expenditures of a capital nature that arise during the three-year duration of a Capital Plan. Supplementary Capital has also been utilized as a source of funding for several on-going capital maintenance programs, including the roof replacement and asbestos control programs.

The 1997 - 1999 Capital Plan includes provision for $5,000,000 in Supplementary Capital expenditures to be funded from the Operating Budget (Capital from Revenue) over the three years of the plan.

On April 9, 1998, Council approved the elimination of the Downtown South Park Acquisition program from the 1997-1999 Capital Plan and the reallocation of associated funding. Of this amount, $268,400 was added to Supplementary Capital.

On October 20, 1998, Council approved funding for two transportation studies related to the Skytrain project. Funding for this project is provided in part from a reduction in Supplementary Capital for 1999 of $378,000.

In November, 1998, Council approved the allocation of $300,000 of Supplemental Capital funding for upgrading of the Council Chambers. Funds available for general allocation to other Supplementary Capital projects are reduced to $1,022,000.

DISCUSSION

Appendix 1 summarizes the submissions to the 1999 Supplementary Capital Budget that total $4,806,600. Details of these requests are included in Appendix 3 entitled "Submissions to the 1999 Supplementary Capital Budget".

Appendix 1 also summarizes the recommendations of the staff group that reviewed these requests. That group was comprised of the Deputy City Manager, Manager of Facilities Development, Manager of Building Management and Comptroller of Budgets and Research.

Allocation of the limited funding available in this year's budget required difficult choices to be made among the projects submitted. The recommendations give priority to:

· projects having health or safety implications (e.g.. City Hall Fire Alarm Replacement);
· projects involving capital building maintenance (boiler and HVAC system replacements); and
· projects that were crucial to service improvement initiatives (e.g.. realignment of office space in the Clerks Department)

The highest priority items are recommended for funding from within the 1999 Supplementary Capital budget. There are several projects for which other funding sources will be sought or which will be referred to the Facilities Maintenance Plan being developed as part of the 2000 - 2002 Capital Plan process.

Appendix 2 includes comments on several of the specific projects submitted to the Supplementary Capital Budget, including those where alternative funding sources are recommended.

Appendix 4 provides a five year history of the Supplementary Capital Budget approvals.

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Appendix 2

Comments on the Submissions to the
1999 Supplementary Capital Budget

Details of the submissions to the 1999 Supplementary Capital Budget are included in Appendix 3 (limited distribution). The following comments highlight the issues related to the recommended funding levels of several projects submitted to the 1999 Supplementary Capital Budget.

Ongoing Building Programs

A-1 Roof Replacement Program $145,000
A-2 Asbestos Program 110,000

In the mid-1980's Council began a roof replacement program funded from Supplementary Capital. The recommended funding will continue that program by dealing with the three highest priority replacements identified by Building Management. These include the Vancouver Art Gallery North West roof, City Hall main building roof drains and Pacific Cine Centre on Howe St..

Funding for Asbestos remediation work has been provided for several years from Supplementary Capital. The 1999 program provides for asbestos abatement in the Print Shop located in the subground of City Hall. Funding for other asbestos related work is currently available in the Capital Budget.

City Hall Precinct - Maintenance / Upgrades

A-11 Reconfigure City Clerk's Department $281,200

Renovations are proposed to change the layout and use of 4,275 sf. of space on the third floor of City Hall, to develop an open office concept thereby creating a more flexible office environment. These changes are intended to facilitate a reorganization by bringing together similar functional units that are now separate. The intent is to streamline processes, increase efficiency and eliminate duplication. Removing the existing physical barriers will foster teamwork and allow more cross-training, whichin turn will facilitate automation of City Clerk's functions.

A-16 Replace Fire Alarm System - City Hall $368,800


The current system installed in 1968 no longer meets the requirements of the building or Codes. Due to the antiquity of the system, replacement parts are no longer available and components are incompatible with new building systems. As such, replacement of the existing system must be expedited to ensure that acceptable safety standards for Civic Buildings are maintained. The new fire alarm system will cover the Tower and East Wing of City Hall. It will connect to the current sprinkler system in the Tower, however provision has not been made for sprinklers in the East Wing.

Other Building Maintenance & Upgrades

A-24 Replace Boiler - South Hill Branch Library $35,000

Priority building maintenance projects recommended for 1999 Supplementary Capital funding includes replacement of the boiler at the South Hill Branch Library. The system has reached the end of its useful life and requires replacement in 1999.

B - 5 Renovate Administration Building Boardroom $57,000

The proposed renovation involves general upgrade of the boardroom facility as well as significant improvement to the audio visual systems.

Civic Theatres / Museums

C - 1 Civic Theaters Fire Suppression System $25,000

Inspection of the Exhaust hood/ Fire Suppression System for the Civic Theaters restaurant, has revealed that it is not in compliance with current standards and represents a fire hazard. Although the project was initially identified for funding within the 2000 - 2002 Capital Plan, replacement of this system requires priority attention and funding within the 1999 Supplementary Capital budget.

Approvals in Advance

E - 1 Upgrade Council Chambers $300,000

Supplementary Capital Funding for this project has received prior Council approval.

ATTACHMENTS THAT DO NOT HAVE ELECTRONIC COPY ARE AVAILABLE ON FILE IN THE CITY CLERK'S OFFICE

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(c) 1998 City of Vancouver