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2022-07-15 Finance Committee Minutes - Open SessionFinance Committee Meeting Open Session July 15th, 2022 MINUTES —OPEN SESSION FINANCE COMMITTEE MEETING J U LY 15, 2022, AT 2:00 PM MEETING CONDUCTED BY ELECTRONIC PARTICIPATION Present: Mayor D. Noade Reardon Councillor G. Sullivan Councillor P. Radwan Councillor D. Hickey Councillor G. Norton Also Present: City ManagerJ. Collin Commissioner of Finance and Treasurer K. Fudge Commissioner Transportation & Environment M. Hugenholtz Commissioner Saint John Water B. McGovern Director Permitting and Development A. Poffenroth Deputy Fire Chief M. Carr Director Financial Services J. Forgie Director Financial Services C. Lavigne Accountant V. Parikh Solicitor O. Lineros Manager Procurement C. Roberts Administrative Officer R. Evans Administrative Assistant K. Tibbits 1. Meeting Called to Order Councillor Sullivan called the Finance Committee open session meeting to order. 2. Approval of Minutes 2.1 Minutes of May 26, 2022 Moved by Councillor Hickey, seconded by Mayor Noade Reardon: RESOLVED that the minutes of May 26, 2022 be approved. MOTION CARRIED. 2.2 Minutes of June 9, 2022 Moved by Mayor Noade Reardon, seconded by Councillor Hickey: RESOLVED that the minutes of June 9, 2022 be approved. MOTION CARRIED. 3. Approval of Agenda Moved by Mayor Noade Reardon, seconded by Councillor Hickey: RESOLVED that the agenda of July 15, 2022 be approved. MOTION CARRIED. 4. Disclosures of Conflict of Interest Finance Committee Meeting Open Session July 15th, 2022 No disclosures. 5. Consent Agenda 5.1 Update Procurement Card Policy Moved by Mayor Noade Reardon, seconded by Councillor Hickey: RESOLVED that as recommended in the submitted report Procurement Card Policy, Finance Committee recommends the approval of the amendments to the Procurement Card Policy FAS-026 to Common Council. MOTION CARRIED. 5.2 2022 Budget Timelines Moved by Mayor Noade Reardon, seconded by Councillor Hickey: RESOLVED that the submitted presentation City of Saint John Operating and Capital Budget Timelines, be received for information. MOTION CARRIED. 6. Business Matters 6.1 General Fund Lone -Term Financial Plan Mr. Fudge stated that the long-term financial plan must be reviewed at least annually to adjust for changes in assumptions driven by economic factors, financial factors, or service level changes. An updated version of the plan will be provided to the Finance Committee by year-end for review. Feedback is being sought with respect to setting key goals and targets that will be critical inputs used in the updated plan. The updated financial targets and principles include maintaining the tax reduction goal of 1.57 by 2032; reducing the infrastructure deficit by 25% over 10 years; maintaining target pay-as-you-go (capital from operating) budget by $1M per year; modifying the wage escalation policy to align wages and benefits with increases to overall reoccurring revenue growth; continuing to reduce debt balance by 25% over 10 years; and continuing to increase contributions to capital reserves by 10% per year. The Committee provided input on each of the targets for consideration into the long-term financial plan. Moved by Councillor Radwan, seconded by Mayor Noade Reardon: RESOLVED that as recommended in the submitted presentation Long -Term Financial Plan Targets and Principles, the Finance Committee direct staff to continue with current Financial Principles and Targets embedded in the Long -Term Financial Plan as part of the updated plan. MOTION CARRIED. 6.2 Grant to Saint John Theatre COmpa Referring to the submitted report, Mr. Fudge stated that the Finance Department reviewed the recommendation from the Growth Committee with respect to awarding the Saint John Theatre Company (SJTC) a grant for $814,000 to support the courthouse project to be funded with $414,000 from Discover Saint John reserve funds and pre -approving $100,000 over the next 4 budget years (2023, 2024, 2025, 2026) from the General Operating Budget. Upon review, the Finance Department is providing the following observations: • The SJTC grant does not generate incremental property tax revenue (theatre will be exempt from municipal and provincial property tax) and taxpayers will not obtain a financial return or payback on its investment; • Common Council should approve a policy with criteria for the use of DSJ reserve funds to support the evaluation of the grant request from the SJTC; • Pre -approving future operating budgets (4 years) is not a recommended practice due to future uncertainties; • Given the large financial commitment, the City should request SJTC submit a business plan to conduct due diligence to protect its investment; • The assumptions in the Economic Impact Assessment (EIA) require further vetting; Finance Committee Meeting Open Session July 15th, 2022 • Province is the primary recipient of direct and indirect economic benefits based on the review of the EIA; and, • The accommodation levy should be explored as a future grant funding source. Moved by Mayor Noade Reardon, seconded by Councillor Radwan: RESOLVED that as recommended in the submitted report Grant to Saint John Theatre Company the Finance Committee makes the following recommendation: 1. Finance Committee recommends Common Council approve evaluation criteria in a policy for the use of Discover Saint John (DSJ) reserve funds and the Saint John Theatre Company (SJTC) grant request be re- evaluated based on Council approved criteria. 2. Given the significant financial request, the Finance Committee recommends SJTC submit a business plan as part of the evaluation process to allow the City to conduct due diligence to protect any City investment. 3. Finance Committee recommends that requests for grants funded by the General Operating Budget in the years 2023, 2024, 2025 and 2026 be referred to the budget process in those years. MOTION CARRIED. 6.3 Procurement Policy Update Ms. Forgie reviewed the submitted presentation "Procurement Policy Modernization Policy" and discussed the procurement method, spending authority, delegation of approval authority, inclusion of social procurement, inclusion of ethics, adjustments being considered in accordance with best practice, the engagement process, and next steps to be undertaken. Moved by Councillor Radwan, seconded by Councillor Norton: RESOLVED that the submitted presentation Procurement Policy Modernization Policy, be received for information. MOTION CARRIED. 7. Adjournment Moved by Mayor Noade Reardon, seconded by Councillor Hickey: RESOLVED that the Finance Committee meeting be adjourned. MOTION CARRIED. The Finance Committee open session meeting held on July 15, 2022, was adjourned at 4:38 pm.