Capital Budget Priority Spending Approved

Cast Iron Water Main removed for replacement in 2018 - file photo

In what is seen by some as a rationalization of but to others the wrong road to follow Council approved the reduction of $40 million in the 2019-2024 Capital Budget to $202 million.

In a move original spearheaded by Councillor Chris Warren, Administration came back with a revised look at capital expenditures over the next five years. The revision had originally been called for by Councillor Warren as the City could not afford the original $242 million proposed capital expenditures over the same period.

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In discussion around the report from Budget Committee Councillor Brian Swanson said he opposed the cutting on infrastructure expenditures and therefore was asking for a re-vote on the issue and he would also be voting against the Five Year Capital Budget.

Speaking on the issue Councillor Swanson said spending needed to be more concentrated on the Capital Budget with money taken away from the Operations Budget to accomplish that.

“Cast Iron (Water Main Replacement funding) is insufficient to deal with the issue,” he said, adding the City needed to be “more focused on capital spending.”

He said with spending on Cast Iron Water Main Replacement capped at $6.5 million over the next few years there would be less and less replacement work done at a critical juncture and the City needed to increase its work in that area.

The Cast Iron Water Main Replacement Project is to be a 20 year project requiring 4,000 meters of line replacement annually but at the present time the City has yet to complete 3,000 meters of work in a year.

Councillor Chris Warren stated he supported the reduction because it identified what work needed to be done and it “prioritizes what is important to this community and to this Council.”

Cutting the capital budget helps to eliminate the $30 - $40 million in carry over work budgeted but was not being completed on an annual basis.

“The reality was we are not able to achieve what we are attempting to achieve in the five year plan. Some of the larger projects have been lengthened based on risk and reward,” he said.

“With this new five year plan we have reduced the amount we have to borrow by $25 million…I support this budget it is what we can actually achieve in this city.”

Councillor Heather Eby attempting to inject a dose of reality into the debate by pointing out although it is called a Five Year Capital Budget Council at the present time can only vote on what is being done in 2019 and the present council has only next year where it can make actual spending decisions.

“The next group of people could drastically change things one way or the other,” Councillor Eby said.

By adopting the Capital Budget and its plan Eby stated “if we see significant reductions in carry over we can look at things like cast iron.”

Councillor Eby also ventured to mention the L word or Levy when it came to infrastructure funding. In her first term on Council it was something she suggested but the idea was abandoned due to a public outcry against the move.

“It may not be popular but in the next year we will have to look at a levy to supplement the capital work we are doing.”

Councillor Crystal Froese coming out and complimenting Administration on their work with the Capital Budget reductions accompanied by Councillor Swanson’s following remarks that the revised capital spending plan simply moved $40 million in work out further led to a bit of a heated exchange between the two councillors.

“Point of order that was an insult to our staff. I just complimented them and you just insulted them,” Councillor Froese stated.

“All I am making is the point is we took work and moved it further out. That is a fact and is not an insult,” Councillor Swanson replied.

Councillor Warren stated there needed to be some comment as to what in fact Administration had done.

“It wasn’t just deferring it, it was taking a closer look at these projects and really determining what is required,” Councillor Warren said.

City Manager Jim Puffalt said by taking a closer look at the work being carried over they were able to eliminate $7 million worth of work because "we didn’t need it.”

Another area is finding ways to reduce expenditures where they are not necessary, he said

Examples given were to use new technology to line pipes in areas where there are not a lot of cross connections to reduce work and expense as well as doing more in-house engineering services as the cost was cheaper.

Regarding the cast iron water main situation Puffalt said the City is reacting instead of acting.

“Right now we are dealing with trouble areas…we are fighting fires we are not doing it systematically.”

Mayor Fraser Tolmie said “the key here is fine tuning.”

“How do you come up with a long term plan to solve the situation we are in?…what we are trying to do is to create a stable environment for business and homeowners.”

“We need to make a calm, cool and collective decision. The decision was to give Administration an opportunity to re-evaluate and come up with a different plan. What is necessary is priority budgeting.”

In a 6 - 1 vote with Councillor Swanson opposed the Capital Budget was approved.