ADMINISTRATIVE REPORT
Date: April 3, 1996
TO: Vancouver City Council
FROM: Director of Finance, in consultation with the
Manager of Community Services, Social Planning
SUBJECT: Operating Agreement Extension -
Ray-Cam Co-Operative Centre Association
RECOMMENDATIONS
A. THAT Council approve a three-year extension with Ray-Cam Co-
Operative Centre Association for the period of January 1,
1996 to December 31, 1998, with modification to the terms of
the agreement as detailed in the report. The 1996 cost of
the contract is $106,000; source of funds to be the 1996
Operating Budget.
B. THAT the Director of Legal Services be authorised to
finalise and execute the agreement to the satisfac-tion of
the Director of Finance.
C. THAT Council approve a one-time adjustment of $5,300 to the
Ray-Cam Co-Operative Centre Association for the 1995 CUPE 15
contract increases; source of funds to be the reserve for
1995 contract settlements.
CONSIDERATION
D. THAT Council approve a one-time adjustment of up to $11,000
to provide extended sick and vacation cover-age at the Ray-
Cam Co-Operative Centre Association; source of funds to be
the 1996 Operating Budget.
GENERAL MANAGERS' COMMENTS
The General Managers of Corporate Services and Community Services
RECOMMEND approval of A, B and C, and submit D for CONSIDERATION.
COUNCIL POLICY
Approval of grants require eight affirmative votes of Council.PURPOSE
The purpose of this report is to seek Council approval for a three-
year extension with the Ray-Cam Co-Operative Centre Association for
the operation of core programs at the centre, and to provide one-time
adjustments based on the request from the Association.
BACKGROUND
The City has provided funds to supplement the operating costs of the
four core programs operated by the Ray-Cam Co-Operative Centre
Association (Ray-Cam) for a number of years: the Special Needs
Daycare, the Latchkey program, the Family program and a Youth Worker.
City support arose from the 'common employer' status that exists
between the City and Raycam. The staff at Ray-Cam belong to the same
bargaining unit as the City's union staff and share the same salary
and benefit structure. Because there was a gap between the funds Ray-
Cam received from other sources to support these positions and the
actual costs, and the City agreed to fund the 'top-up' of the wages to
the union pay level.
Until 1993, City support was provided in the form of Community
Services grants. Annual requests were evaluated with those from other
social service organisations and funds were allocated from within the
Community Services grant ceiling.
This process worked fairly well until the 1991-1993 VMREU contract was
approved and the 1993 grant request was processed. This request,
including a "catch-up" for 1991 and 1992, repre-sented a significant
drain on the Community Services grant ceiling, creating a situation in
which the increase severely limited the funds available to deal with
the needs of other organisations.
In response to this situation, on March 25, 1993, City Council
approved the transfer of the Ray-Cam grants out of the Community
Services grant stream and directed that the City enter into an
agreement with Ray-Cam to provide 'top-up fund-ing to the four core
programs. The appropriate level of fund-ing was removed from the
Community Services grant budget so that there would be no increase in
the cost to the City as a result of this change. This funding
transfer included $11,500 which was transferred to Park Board to fund
the "Youth-Helping-Youth" position at Ray-Cam Centre.
The operating agreement with Ray-Cam was approved by City Council on
April 6, 1993. It covered a three year period from January 1993 to
December 1995, at a 1993 cost of $101,058. It was the City s
intention that the agreement would provide funds on the same basis as
the Community Services grant, that is, to 'top-up the wage component
of the four core programs. The agreement was signed in July 1993 by
the City and a representative of the Ray-Cam Board.In late 1993, the
Ray-Cam Board initiated the negotiation process for the 1994 funding
level. In a letter to the City, the Board indicated that it was their
belief that they were not receiving an equitable level of daycare
funding from the Provincial Ministry of Social Services and coupled
with declining discretionary and non-directed funding, such as bingo
revenues, was severely limiting their ability to deliver the core
programs. Although the City had continued to maintain the agreed
level of support to Raycam, even to the extent of excluding the centre
from the 1994 Budget Management Program, the lack of funds from the
other funding sources had forced Ray-Cam further into a deficit
position.
The Ray-Cam Board believed that, under the terms of the agreement, the
City would work with the Association to address these shortfalls
possibly by an increase in funds available through the agreement. A
number of meetings were held between the City and Ray-Cam board
members and staff in 1994 and 1995 to deal with the funding issue.
City staff concluded that the City had acted in accordance with the
terms of the agreement and were not in a position to re-open
negotiation with Ray-Cam until the agreement expired by the end of
1995. However, the Ray-Cam Board felt that this decision was not
representative of the terms of the agreement.
In the meantime, the operating deficit in the four programs had
increased by $26,000, from $15,000 in March 1993, to $41,000 in March
1995. The operating results of the 1995/1996 fiscal year are not
known at this time.
DISCUSSION
The dilemma faced by the Ray-Cam Board is not unique, however, the
Board believes its options for improving the funding of its programs
are limited. The Board argues, for example, that unlike other
community associations, the socio-economic situation in the
neighbourhood it serves leaves it unable to raise additional funds
through user fees. And while it is recognised that the board and
volunteers at Ray-Cam provide an invaluable service, they do not
diminish the need for the professional staff and program funding
required to meet licensing requirements. In the face of increasing
costs and declining funding level from the provincial government, the
board is concerned that it will not be able to maintain the current
service level at the Centre without securing additional external
financial assistance.
Entering into the negotiation of an extension to the original three
year agreement, it was the intention of City staff to reach an
agreement that would preserve the four core programs at the current
service level for the next three years, and at the same time, avoid
any future misunderstandings around the agreement.
Two separate, and very positive meetings were held in October and
November 1995 involving Ray-Cam and City and Provincial staff. The
Ray-Cam Board tabled a budget of $478,411 representing its view of the
minimum amount of global funding required to operate the four core
programs at the basic service level, including salary costs as
calculated under the terms of the current collective agreement. It is
their expectation that the City s contribution through the operating
contract would increase to reflect any future funding reductions from
the Provincial Government.
City staff believe that the current request represents a fundamental
change in the City s funding relationship with Ray-Cam in that the
request goes beyond the previous 'top-up' arrangement and includes a
request for administrative and program support that had not been
included before. However, with the agreement for a funding
partnership with the Provincial Government in the operation of the
Special Needs Daycare Program, staff are satisfied that the change is
appropriate in the circumstances.
At the conclusion of the negotiation, it was agreed that after
adjusting for the 1996 CUPE 15 contract costs and provide for
inflationary adjustments to the other components of the budget, City s
share of the program costs is $106,000 in 1996, calculated as follows:
Gross Program Budget, after adjusted for
CUPE 15 contract increases & inflation $478,411
Less : Contribution from MSS and other
contracts (336,185)
$142,226
Less : Additional funding from MSS (25,000)
Adjustment to Administrative Overhead
to reflect the recreation facility
clerk position approved by PK Bd (11,226)
Proposed 1996 Contract $106,000
The highlights of the proposed contract with Ray-Cam are included in
Appendix A. Staff met with representatives of the Ray-Cam Board on
March 14, 1996, and have received their concurrence on the terms of
the contract.
CONTRACT ISSUES
There are three issues that should be brought to Council s attention
in the new contract.
A. Additional Funds from Provincial
Ministry of Social Services
Due to their own budget situation, Provincial staff were unable to
provide additional funds towards the Youth Worker program. However, on
the initiative of the Ray-Cam Board, the Ministry of Social Services
has allocated one-time funding of $25,000 towards the Special Needs
Daycare Program for the 1995/1996 fiscal year. They have also made a
commitment to process a formal request to the Ministry of Women's
Equality to provide baseline funding for this increase in the
1996/1997 fiscal year.
The $25,000 in 1995/1996 will go a long way to easing the financial
problems at Ray-Cam. This amount has been taken into consideration in
the 1996-1998 operating agreement with Ray-Cam. Although the increase
is not guaranteed beyond the current provincial fiscal year, staff are
hopeful that this funding will continue and the programs at Ray-Cam
can be preserved. In the event that this ongoing increase in funding
does not materialise, City staff will work with the Ray-Cam Board to
explore options to secure additional external funds or to adjust
program levels. Any additional funding that may be necessary from the
City or change in program levels will be the subject of a report to
Council.
The Ray-Cam Board recognises its responsibility to ensure that the
centre receives an equitable level of funding from the Province for
its programs. While the City has agreed to participate in funding
these programs, the level of funding is not open-ended. Staff have
encouraged the board to continue to seek other funding sources to
reduce its reliance on government.
B. Administrative Overhead
The proposal from Ray-Cam includes an administrative overhead
allowance of $37,000 or 7.7% of the gross budget of the four core
programs. The administrative overhead includes a share of the office
support costs provided by the Association to the programs. During the
negotiation process, it was agreed that an amount of $25,774 or 5.4%
would be appropriate, after taking into consideration the addition of
the regular full-time recreation facility clerk position approved by
Park Board.
C. Adjustments for Cost of Future Union Contracts
With the 'common employer' relationship between Ray-Cam and the City,
any significant changes in the compensation package in the collective
agreement can cause problems for Ray-Cam, as the other funding sources
may not be able to provide the same level of increase in funding to
cover the wage increases. It is recommended that, for the duration of
this agreement, the City will provide the full cost of future
negotiated settlements as related to the four programs, after taking
into consideration the funds received from other sources. This
provision could result in minor changes in the funding to Ray-Cam
during the life of the agreement. For example, the current
calculation of the City s share of the costs is based on the 1995/1996
recovery rates from the other agencies. There could be minor
adjustments to the contract amount should the recovery rates change in
the 1996/1997 fiscal year.
The worksheet provided by Ray-Cam with their proposal for 1996 will
form the basis of the calculation when the need arises.
OTHER ISSUES
A. 1995 CUPE 15 contract adjustment
The 1993 - 1995 operating contract with Ray-Cam allows for adjustment
to reflect the cost of the negotiated contract settlement in the four
core programs. Based on the calculation submitted by the Association,
an amount of $5,300 is required to fund the 1995 increase in wages and
benefits. Funding for this adjustment is to be provided from the
reserve for 1995 wage settlement.
B. Extended sick and vacation coverage
The operating contract with Ray-Cam includes provision for normal sick
and vacation coverage in a year, but does not include funding for
extended leave coverage which are being considered on a case-by-case
basis in the past.
A request for a fourteen week extended sick and vacation leave has
been submitted by a staff to the Association. The additional cost to
provide full coverage during that period is $11,000. The Association
does not have the funds at this time to cover this need and has
requested the City to fund it. Staff have reviewed the request and
are supportive of the request. The request, if approved, will allow
the Association to continue the program while the staff is on extended
leave of absence.
If this request is approved by Council, Ray-Cam will be reimbursed
based on the actual cost incurred. The Director of Finance submits
this request for consideration, noting that the source of funds for
the request is the 1996 Operating Budget.
FINANCIAL IMPLICATIONS
The cost of the proposed contract with Ray-Cam is $106,000 in 1996,
after taking into consideration the additional funding $25,000 from
Ministry of Social Services, and the negotiated adjustment to
administrative overhead to allow for the recreation facility clerk
position approved by Park Board. Funds for the contract is to be
provided from the 1996 Operating Budget.
The more significant issues that would have an impact Ray-Cam
operations are the possible reductions in CAP and Daycare funds from
the Province. Funding support through CAP is provided to the
community centre operation (Park Board), and the Ministry of Women s
Equality, through the Ministry of Social Services is the primary
funding source of the daycare programs operated by the Association.
If there is a change in these funding levels, staff will indicate the
impact in a report back to Council.
CONCLUSION
It is important to finalise the contract with Ray-Cam now at the
negotiated funding level in order to provide some stability to the
operations and continue to operate the programs at the current service
level. This proposal is recommended on the assumption that Ray-Cam
will receive an additional $25,000 from the Province and that Park
Board have provided full year funding for the recreation facility
clerk position in Ray-Cam. In the event that there are changes in the
funding levels, City staff will assist Ray-Cam to evaluate options
with Ray-Cam to address the problems and report back to Council.
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APPENDIX A
City of Vancouver - Ray-Cam Co-Operative Centre Association
Outline of Proposed Terms of Agreement
1. Intent: To cost share the Daycare, Latchkey and Youth Worker
programs with other funding sources, at a global
program level of $478,411. City s share is $106,000
(1996 rates). Details as in Appendix B.
2. Term: 3 years from January 1, 1996 to December 31, 1998
inclusive.
3. Renewal: 3 months before expiry of the contract, for a further
extension of 3 years.
4. Services
Covered: as in section 3 of 1993 - 1995 agreement.
5. Costs: includes negotiated wages and benefits, program costs
and administrative overhead, as submitted and
negotiated with Ray-Cam.
6. Annual
Adjustment: as in section 5 of current agreement. The agreement
with the City is to be adjusted annually by the wage
increase as negotiated in the CUPE 15 contract, after
allowing for changes in the funds from other sources.
7. Payment
Frequency: quarterly instalments.
8. Others: along the same principles as in the current agreement.
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