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2019-07-18 Finance Committee Minutes - Open SessionFinance Committee Meeting Open Session July 18, 2019 MINUTES — OPEN SESSION FINANCE COMMITTEE MEETING JULY 18, 2019 AT 5:15 PM 8t" FLOOR COMMON COUNCIL CHAMBER (LUDLOW ROOM), CITY HALL Present: Mayor D. Darling Councillor D. Merrithew Councillor G. Sullivan Councillor G. Norton Absent: Councillor S. Casey Councillor D. Reardon Also Present: City Manager J. Collin Deputy City Manager N. Jacobsen Commissioner of Finance and Treasurer K. Fudge Commissioner Growth & Community Development J. Hamilton Comptroller Finance C. Graham City Solicitor J. Nugent Director Corporate Performance S. Rackley -Roach Assistant Comptroller Finance and Administrative Services C. Lavigne Deputy Commissioner Administrative Services I. Fogan Senior Financial Analyst J. Forgie Administrative Fire Officer J. Hennessy Administrative Assistant K. Tibbits 1. Meeting Called To Order Councillor Merrithew called the Finance Committee open session meeting to order. 1.1 Approval of Minutes — May 29, 2019 Moved by Mayor Darling, seconded by Councillor Norton: RESOLVED that the minutes of May 29, 2019 be approved. MOTION CARRIED. 1.2 Public Consultation Budget Simulator Results Ms. Forgie reviewed the results from the public consultation budget simulator exercise, noting that participation from the public was very good with equal participation across all wards. Results were validated and a number of themes identified. These themes will be used in the creation of the long-term financial plan. Key themes included: • Tax Rate - results mixed; 50% chose to either maintain or decrease rates; 50% indicated a slight increase could be tolerated. Finance Committee Meeting Open Session July 18, 2019 • Service Areas — no area was untouched and all areas received a slight reduction, ranging from 1.5% to 19% depending on the service. Highest reductions were in economic development, transit services, recreation programming, sports facilities, One -Stop Shop Development/property compliance programs. Lowest reductions were in road maintenance, snow control and sidewalks. • Revenue Generation — common themes included non-resident user fees and taxes, tolls on City roads, charges to neighbouring communities for services and taxation of heavy industry. • Community Facilities results — common themes included alternative funding models, closure of facilities, higher contributions from users outside the City • Comments on bringing awareness to the City's positive attributes Moved by Mayor Darling, seconded by Councillor Sullivan: RESOLVED that the Public Consultation Budget Simulator Results be received for information. MOTION CARRIED. 1.3 Proposed Phase 1— Municipal Tax Reform Mr. Jacobsen noted that the proposal on Municipal Tax Reform was one of many sustainability themes discussed within the mandate of the Government of New Brunswick / City of Saint John Municipal Sustainability Working Group. The province derives significant revenue annually from heavy industry located in the Saint John area through various taxes. The proposed municipal heavy industrial property tax reform recommends that 100% of the property tax collected from large industry in Saint John stays within the City of Saint John. This would be an interim step in the much broader review of property taxation issues committed to by the province in the recently released "Sustaining Saint John Three -Part Plan." Mr. Jacobsen and Mr. Fudge reviewed the submitted report. Key highlights of Phase 1 — Municipal Tax Reform include: • alleviates the province from making any future special funding requirements with respect to the $10.4M in 2020; • provides an immediate sustainability solution as the City implements a series of sustainability action items; • redistributes $9M in property tax revenue which is supported by the fair taxation report experts and would be transformational for the City, representing almost 6% of the budget versus 1 tenth of a percent for the province of NB; • can be positioned as an important first step in municipal tax reform and a comprehensive review of municipal tax system by the province of NB; • does not require new tax assessment capabilities or resources from the province. Moved by Mayor Darling, seconded by Councillor Sullivan: RESOLVED that the submitted presentation entitled Proposed Phase 1 — Municipal Tax Reform be forwarded to the Southern Regional Caucus and the Premier's Office. MOTION CARRIED. Moved by Mayor Darling, seconded by Councillor Sullivan: RESOLVED that the submitted presentation entitled Proposed Phase 1 — Municipal Tax Reform be received for information. MOTION CARRIED. 2 Finance Committee Meeting Open Session July 18, 2019 1.4 2020 and 2021 Proposed Draft General Fund Capital Budgets Mr. Fudge stated that the proposed capital budget represents over $50M in investment over the next two years. It leverages funding from other levels of government as much as possible. Of the $50M two year capital budget, $29M is proposed to come from the other levels of government for programs that are aligned with the City's strategic investment priorities. Mr. Lavigne reviewed the 2020 and 2021 proposed Draft General Fund Capital Budget and the proposed Draft Utility Fund Capital Budget. Moved by Councillor Sullivan, seconded by Mayor Darling: RESOLVED that the Finance Committee recommend that the 2020 and 2021 Proposed Draft Utility Fund Capital Budget be presented to Common Council with a recommendation to receive and file; and that the Finance Committee recommend that the 2020 and 2021 Proposed Draft General Fund Capital Budget be presented to Common Council with a recommendation to receive and file. MOTION CARRIED. 1.5 Bi -Lateral Funding Application Mr. Lavigne explained that in 2017 the Government of Canada announced a $33B ten year funding agreement with the provinces/territories under four different funding streams, including public transit, green infrastructure, community cultural and recreation infrastructure and infrastructure needs for rural and northern communities. Projects will be cost shared between the federal (40%), provincial (33%) and municipal (27%) levels of government. The City of Saint John submitted Expression of Interests for the following projects: • Fundy Quay project, total value $38M • Green Infrastructure, total value $40M Mr. Fudge noted that there is no commitment by the City to proceed. This is only an application phase. The application was highly concentrated on projects that the City will have to do regardless with respect to the capital investment plan. Mr. Collin noted that there were constraints and strict guidelines within the various funding envelopes. Moved by Councillor Norton, seconded by Mayor Darling: RESOLVED that the submitted presentation on the Bi -Lateral Funding Application be received for information. MOTION CARRIED. Adjournment Moved by Councillor Sullivan, seconded by Mayor Darling: RESOLVED that the open session meeting of the Finance Committee be adjourned. LTA [00411111►[4L1:k]k]111101 The Finance Committee open session meeting held on July 18, 2019 was adjourned at 6:40 p.m. 3