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2022-09-28 Finance Committee Minutes - Open SessionFinance Committee Meeting Open Session September 28, 2022 MINUTES —OPEN SESSION FINANCE COMMITTEE MEETING SEPTEMBER 28, 2022, AT 5:00 PM MEETING CONDUCTED BY ELECTRONIC PARTICIPATION Present: Councillor G. Sullivan Councillor P. Radwan Councillor G. Norton Councillor D. Hickey Absent: Mayor D. Noade Reardon Also Present: City Manager J. Collin Commissioner of Finance and Treasurer K. FudgE Commissioner Transportation & Environment M Commissioner Saint John Water B. McGovern Commissioner Growth & Community Services J. Commissioner Human Resources S. Hossack Director Engineering and Chief City Engineer M. Director Financial Services J. Forgie Director Financial Services C. Lavigne Intermediate Accountant V. Parikh City Clerk J. Taylor Administrative Officer R. Evans Administrative Assistant K. Tibbits 1. Meeting Called to Order Hugenholtz Hamilton Baker Councillor Sullivan called the Finance Committee open session meeting to order. 2. Approval of Minutes 2.1 Minutes of August 24, 2022 Moved by Councillor Hickey, seconded by Councillor Norton: RESOLVED that the minutes of August 24, 2022 be approved. MOTION CARRIED. 3. Approval of Agenda Moved by Councillor Hickey, seconded by Councillor Norton: RESOLVED that the agenda of September 28, 2022 be approved. MOTION CARRIED. 4. Disclosures of Conflict of Interest No disclosures. 5. Consent Aeenda Finance Committee Meeting Open Session September 28, 2022 6. Business Matters 6.1 2022 Bilateral Program Projects — Reserve Funding and Pre -approval of 2023 Utility Program Funding Mr. McGovern noted that the cost of construction has increased significantly which has impacted previous cost estimates on several multi -year projects. Costs were estimated to escalate in accordance with historical and inflationary trends, not the double-digit increases being seen. Mr. Baker reviewed the submitted presentation and discussed how funding might be allocated to complete the projects based on revised engineering estimates. It is in the City's best interest to get tenders out as early as possible. Supplemental funding is required for seven 2022 Bilateral funded projects. The supplemental funding is being requested based on the higher -than -expected tenders received in 2022. Moved by Councillor Norton, seconded by Councillor Radwan: RESOLVED that as recommended in the submitted report 2022 Bilateral Program Projects — Reserve Funding and Pre -approval of 2023 Utility Program Funding, the Finance Committee: • Endorse the approval of the allocation of capital reserve funding ($485,000) for the seven 2022 Bilateral funded projects as noted in Appendix A attached to the Finance Committee Report dated September 21, 2022 and titled 2022 General Fund — Bilateral Program Projects — Supplemental Funding; and • Endorse the allocation of $170,000 of unallocated 2022 General Fund Capital Budget to the seven 2022 Bilateral funded projects as noted in Appendix A; and • Endorse the pre -approval of the proposed 2023 Utility Fund Capital projects (Supplemental Funding) noted in Appendix B attached to the Finance Committee Report dated September 21, 2022 and titled Preapproval of Utility Fund —2022 Bilateral Program Projects (Supplemental Funding); and • Recommend approval of the above noted items at the next meeting of Council. MOTION CARRIED. 6.2 City of Saint John Natural Infrastructure Fund Mr. Yammine provided an update on the City's funding application to the Natural Infrastructure Fund ("NIF") for Urban Tree Planting within the City of Saint John. Staff identified a list of capital projects that are aligned with the NIF program, Council Priorities for 2021 to 2025 and the 10 Year Strategic Plan. The Urban Tree Planting project was identified as a suitable candidate, taking into consideration the timeline to complete the work and alignment with various plans and priorities. There is opportunity to leverage capital funding from the new Natural Infrastructure Fund toward the City Urban Tree Planting Project. City funding will be covered under the operating budgets of 2023 and 2024. Moved by Councillor Norton, seconded by Councillor Radwan: RESOLVED that the submitted report Natural Infrastructure Fund — City Submission, be received for information. MOTION CARRIED. 6.3 Recommended 2023/2024 General Fund and Utility Fund Capital Budgets Mr. Fudge noted that a two-year draft capital budget for both the general fund and utility fund was presented at the last Finance Committee meeting. The two-year capital programs have a combined value of approximately $90M with less than $18M funding through new debt. Mr. Lavigne provided explanation on the minor changes made from the first draft of the budgets, noting that most changes are based on updated information on funding opportunities, feedback from stakeholders, and more certainty around projects, with some projects being moved between budget Finance Committee Meeting Open Session September 28, 2022 years. With the creation of the new Regional Service Commission, contributions are expected from the Commission as it relates to Capital renewal and funding which is included in the updated version. Moved by Councillor Norton, seconded by Councillor Hickey: RESOLVED that as recommended in the submitted report 2023 & 2024 Draft General and Utility Fund Capital Budgets, the Finance Committee adopt the following: • The Finance Committee approve the 2023 and 2024 General Fund Capital Budget for $62,570,055 with City Share of $29,949,247 and Other Share of $32,620,808 and forward to the next meeting of Common Council for receive and file; and • The Finance Committee approve the 2023 and 2024 Utility Fund Capital Budget for $27,237,067 with Utility Share of $9,908,556 and Other Share of $17,328,511 and forward to the next meeting of Common Council for receive and file. LTA to] 1[4110DY1ilk] k]1I191 6.4 Council Professional Development Policy Mr. Fudge noted that Council wanted structure to the way professional development opportunities are budgeted and allocated to elected officials. The Mayor and Council professional development policy sets criteria for eligible professional development activities, establishes protocol on the allocation of budget to Mayor and Council, ensures fairness and equity between Councillors with respect to usage of funds and instills reporting requirements for public transparency. Moved by Councillor Radwan, seconded by Councillor Hickey: RESOLVED that as recommended in the submitted report FAS-027 Mayor & Council Professional Development the Finance Committee endorse FAS-027 Mayor & Council Professional Development Policy as presented and that the Chair of the Finance Committee bring forth a recommendation to Common Council for approval. MOTION CARRIED. 6.5 Grant Policy Update Mr. Fudge stated that Council requested the development of a Grant Policy to strengthen grant oversight with best practices respecting application, eligibility, evaluation, reporting, strategic alignment, and accountability. Mr. Fudge provided an update on the public engagement process and updates to the draft policy since it was first seen in March 2022. Moved by Councillor Hickey, seconded by Councillor Radwan: RESOLVED that as recommended in the submitted report FAS 023 — Grant Policy the Finance Committee endorse FAS 023 - Grant Policy as presented and that the Chair of the Finance Committee bring forth a recommendation to Common Council for approval. MOTION CARRIED. 6.6 Proposed Funding Plan for New Recreation Facility Mr. Fudge stated that eight high impact initiatives were endorsed by Council as priorities for catalytic growth, including 4 key infrastructure projects and 4 advocacy projects. A key infrastructure project is a Comprehensive Recreation Facility, envisioned to be a large multi -purpose facility to replace the City's aging arena with space for sports, recreation, and arts. Although no engineering design or preliminary estimates have been conducted, it is reasonable to assume the construction of this facility could range between $50-60M. For this project to be affordable, funding from other levels of government is required. To construct a catalytic recreation facility, a funding plan is required that is fiscally responsible and does not compromise the goals outlined in the long-term financial plan. An allocation up to $3M per year ($15M over 5 years) into a Recreation Facility capital reserve would need to be funded from the general operating budget. Finance also recommends consideration of a resolution of Council to direct staff to allocate any annual operating budget surpluses to a Recreation Facility capital reserve throughout the Council term. Moved by Councillor Hickey, seconded by Councillor Norton: Finance Committee Meeting Open Session September 28, 2022 RESOLVED that as recommended in the submitted report Proposed Funding Plan for New Recreation Facility, the Finance Committee endorse the following recommendations: 1. Direct staff to consider including in the draft 2023 General Operating Budget, conditional upon tax base growth and service level requirements, up to $3 million dollars into a Recreation Facility Capital Reserve. 2. Recommend that Common Council resolve to allocate any operating surpluses over the Council term to a Recreation Facility Capital Reserve to support construction of a new Comprehensive Recreation Facility. 3. Recommend that Common Council direct staff to prioritize the pursuit of federal and provincial funding to support the project. 4. Direct the City Manager to discuss the project with the Regional Service Commission to determine if there is regional interest. MOTION CARRIED. 7. Adjournment Moved by Councillor Hickey, seconded by Councillor Norton: RESOLVED that the Finance Committee meeting be adjourned. MOTION CARRIED. The Finance Committee open session meeting held on September 28, 2022, was adjourned at 6:15 pm.