4. 2012 Proposed Budget process and Timetable

Processus et calendrier proposés pour le Budget de 2012

COMMITTEE RECOMMENDATION

That Council approve the process and timetable for developing and approving the 2012 budget, as outlined in this report.

RECOMMANDATION DU COMITÉ

Que le Conseil adopte le processus et le calendrier visant l’élaboration et l’approbation du budget de 2012, tels qu’ils sont expliqués en détail dans le présent rapport.

Documentation

1. City Manager’s Report, dated 29 August 2011 (ACS2011-CMR-LEG-0025).

2. Extract of Finance and Economic Development Committee Draft Minutes of 6 September 2011.

Report to/Rapport au :

Finance and Economic Development Committee

Comité des finances et du développement économique

and Council / et au Conseil

6 September 2011 / le 6 septembre 2011

Submitted by/Soumis par : Marian Simulik, City Treasurer/Trésorière municipale

Contact Person/Personne ressource : Mona Monkman, Deputy City Treasurer--Corporate Finance/ Trésorière municipale adjointe—Finances municipales

Finance Department/Service des finances

613-580-2424 ext./poste 41723, Mona.Monkman@ottawa.ca

City Wide/à l’échelle de la Ville

Ref N°: ACS2011-CMR-FIN-0045

SUBJECT:	2012 Proposed Budget process and Timetable

OBJET :	Processus et calendrier proposés pour le Budget de 2012

REPORT RECOMMENDATION

That the Finance and Economic Development Committee recommend to Council that the process and timetable for developing and approving the 2012 budget, as outlined in this report, be approved.

RECOMMANDATION DU RAPPORT

Que le Comité des finances et du développement économique recommande au Conseil d’adopter le processus et le calendrier visant l’élaboration et l’approbation du budget de 2012, tels qu’ils sont expliqués en détail dans le présent rapport.

BACKGROUND

Each year Council approves a budget timetable and process report, in preparation for the subsequent year’s budget. Since the election of a new Council on December 1, 2010, Council has already put forward a number of specific directions on the budget process.

With the adoption of the report “Long-Range Financial Plan (Part 1)” in June, Council has endorsed a budget strategy that:

a. Sets the increase in the municipal portion of the tax bill to a maximum increase of 2.5% per year.

b. Requires that all new operating budget needs be established through a Council directed strategic initiatives setting process.

c. Sets the annual operating budget envelope for funding the operating Strategic Initiatives equal to the value of the Provincial upload amount in each of the next three years.

d. Sets the annual capital budget envelope for funding the capital related Strategic Initiatives to an upset envelope limit of $34 million as identified in the 2011 capital budget.

e. Directs the City Manager to work with the Mayor’s office to develop draft annual budgets consistent with the Long-Range Financial Plan, identifying any unforeseen issues and recommending any additional strategies that may be required to achieve Council’s direction.

f. Directs that, as part of the annual budget process, the budget allocation for all local Boards and Commissions be based on their individual pro-rated share of a 2.5% tax increase and an estimated 2% increase in taxes resulting from growth in assessment, and that Council request that these Boards and Commissions develop their draft budgets within their annual allocation.

The budget strategy adopted by Council has established the funding framework through the creation of “Maintain / Growth” funding envelopes based on additional taxation revenues to be derived from a 2.5% tax increase and a projected 2.0% increase from assessment growth. Each of the services governed by either a Board or Commission has been allocated a proportionate share of this projected increase in taxation revenues based on their 2011 net taxation requirements. The remaining balance has been allocated to fund all other tax supported City services.

Through the term of Council priority setting exercise conducted this spring, Council has established it strategic funding priorities for the next three years for both operating and capital as approved on July 13^th in the report “Draft Terms of Council 2011-2014 Priorities”. These initiatives will be reflected in the draft 2012 budget submission this fall.

DISCUSSION

2012 Operating Budget Development

All departments will be developing their 2012 operating budget requirements based on the funding framework approved by Council.

In order to maximize Council’s ability to achieve its stated taxation direction and to minimize potential risk factors, the LRFP (Part 1) report identified the following strategies:

1. The non-discretionary costs associated with the maintenance of existing city services should be considered first in terms of funding priorities;

2. In some areas, more risk may be taken in developing the budget knowing that there are reserve funds, such as the Winter Maintenance Reserve, to smooth fluctuations in expenditures where necessary;

3. The budget would not include any one-time sources of revenue unless they are to fund expenditures that are also of a one-time nature.

In the development of the draft budget, the City’s senior management will be conducting reviews with their respective management teams to:

· Review and assess budgetary pressures in terms of maintaining existing service standards and in support of Council priorities;

· Determine the impact on public / internal clients as to how services would change, be reduced or eliminated given the funding envelopes.

The outcomes of these reviews will be documented and reviewed by the City’s Executive Committee and with the Mayor’s Office in order to assess the overall corporate program or service implications being proposed for inclusion in the 2012 draft budget.

Any adjustments to programs or service standards required to be implemented in order to achieve the taxation target, will be identified in the draft budget document for the consideration of Committees and Council.

2012 Capital Budget Development

As indicated in the LRFP IV (Part 1) report, both the rate supported long-range plan and the long-range capital plan for city-wide funded projects, will come forward later in the year.

The LRFP IV report on tax supported capital to be presented this fall will focus on the capital needs of the programs funded by the City Wide Capital Reserve Fund. It is highly unlikely that any new, additional funds will become available to support the rehabilitation and growth requirements. Therefore it is expected that for the most part, the current rehabilitation and growth projects contained in the 2012-14 forecast would form the basis for the draft capital budget to be tabled this fall.

Proposed 2012 Budget Timetable and Public Consultation Plan

Tax Supported Budget

Through Council direction, the City’s budget process has evolved over the years to allow for greater and earlier input in the development of the budget by both the public and the elected representatives. The proposed 2012 strategy builds upon those past successful processes and mirrors, to a large extent, the 2011 process. The proposed process and timetable for 2012 is outlined below and summarized in Document 1.

1) Mayor’s On-line Pre-budget Public Consultation (September )

In order to engage the public prior to budget tabling and to take advantage of the web-based tools that facilitate such engagement, a budget e-mail box will be launched through the Mayor’s office in September. Any suggestions or ideas that are generated from the email box and can be incorporated into the budget will be provided to management prior to tabling and identified to Council as part of the Draft Budget report tabled on October 26.

2) Tabling of 2012 Draft Budgets with Council (October 26)

The City’s 2012 draft operating and capital budget would be tabled with Council on its regularly scheduled meeting of October 26^th. It is proposed that on that date, all draft tax-supported budgets would be tabled including budgets for services that report to either a Commission or Board, namely Police, Transit, Public Health and Library services. The draft budgets for the Committee of Adjustment and the Crime Prevention Ottawa would also be tabled on that date.

Similar to last year, the main City budget would be presented by both the Mayor and the City Manager. Each of the Board/Commission budgets would be presented by the Chair and the head of the service. Copies of the budgets would be available on-line and in the city’s libraries and client service centers.

3) Community Consultations (November 1-4)

Four community meetings are proposed to present the draft budget to the public and address specific questions or concerns. In addition to a central meeting to be held at City Hall, meetings are planned for East, West and South Ottawa. These meetings will be located in facilities that allow rural residents to attend with relative ease.

As in previous years, Councillors are free to organize and run their own individual ward consultations.

4) Committee / Commission / Board Budget Meetings (November 7-28)

All Standing Committees of Council along with the Transit Commission, Police Services Board, Library Board and Board of Public Health would hold meetings to consider the 2012 draft budget for their respective areas and listen to public delegations on the budget. Special meetings will be required for a few Standing Committees in order to meet the proposed timeframe for adoption of the budget.

5) Council Consideration of Committee / Commission / Board Recommended 2012 Draft Budgets (Special Council meeting November 30)

It is proposed that, at a special meeting of Council to be held on November 30^th, Council consider the budget recommendations from all the Committees of Council and local boards. Council would then adopt the 2012 budget.

Rate Supported Budget

The budget for the services supported by the water/sewer rate is proposed to be considered after the tax-supported budget. This will allow for any adjustments made to the tax supported portion of the integrated program (combined road/water/sewer capital works) to be reflected in the water/sewer rate budget.

It is proposed that the rate supported budget be tabled at a special Environment Committee meeting on January 31, 2012. The committee would then listen to public delegations and deliberate on the budget on February 20, and Council would consider and adopt the budget on February 22, 2012.

RURAL IMPLICATIONS

There are no rural implications associated with this Report.

CONSULTATION

The consultation process on the budget is outlined in this Report.

LEGAL IMPLICATIONS:

There are no legal impediments to implementing the recommendations of this report.

RISK MANAGEMENT IMPLICATIONS

There are no risk implications

FINANCIAL IMPLICATIONS

As outlined in this Report.

TECHNOLOGY IMPLICATIONS

There are no technology implications with this report.

CITY STRATEGIC PLAN

The recommendations in this report are consistent with Council’s strategic planning framework.

SUPPORTING DOCUMENTATION

Document 1 – Proposed 2012 Budget Process / Timetable

DISPOSITION

Staff will develop the 2012 draft budget in accordance with the report recommendation and implement the budget process as outlined in the report.

DOCUMENT 1

Proposed 2012 Budget Process / Timetable

1 – Mayor’s On-line Public Consultation	Sept

2 - Tabling of Tax Supported Budgets to Council (Regular Meeting Day)
City Tax Supported Programs Police Services	Oct 26 - Wed
Library Services
Transit
Public Health Committee of Adjustment Crime Prevention Ottawa

3 - Budget Consultation Meetings (Week of Oct 31 - Nov 4)
4 meetings
South / Rural South - Walter Baker Sportsplex (Barrhaven) 7:00-9:00pm	Nov 1 Tues
West / Rural West - Holy Trinity Catholic School 7:00-9:00pm	Nov 2 Wed
East / Rural East - Shenkman Arts Centre 7:00-9:00pm	Nov 3 Thurs
Central - City Hall 4:00-6:00pm	Nov 4 Fri


*4 - Committee / Boards / Commissions – Special Meeting Days**
Finance, Economic Development Committee	* Nov 7 Mon
Planning Committee	Nov 8 Tues
Transportation Committee	* Nov 10 Thurs
Library Board	Nov 14 Mon
Environment Committee	Nov 15 Tues
Transit Commission	Nov 16 Wed
Community & Protective Services Committee	Nov 17 Thurs
Agriculture & Rural Affairs Committee	* Nov 18 Fri
IT Sub-committee	Nov 21 Mon
Public Health Board	Nov 21 Mon
Police Services Board	Nov 28 Mon


5 - Review / Adoption by Council - Special Meeting	Nov 30 Wed

*Special meeting to be scheduled

Rate-Supported Budget Schedule
Table at Environment Committee	Jan 31, 2012
Committee Review and Public Delegations	Feb 20, 2012
Council review and adoption	Feb 22, 2012