Budget Committee Meeting - Tuesday, May 6, 2025 - 1:30 p.m. - City of Richmond Hill

Estimated read time: 1:20

Summary

The Budget Committee meeting for the City of Richmond Hill, held on May 6, 2025, covered key financial topics, including the adoption of agendas, the review of the city's financial performance in 2024, and future budget strategies for 2026. The meeting highlighted the city's robust financial health due to strong fiscal management, resulting in a budget surplus for 2024, which was attributed to various factors, including increased revenues from recreation programs and efficient financial operations during unexpected challenges. The discussion emphasized the importance of maintaining sufficient tax stabilization reserves and cautiously managing resources amidst economic uncertainties, aiming to safeguard services while minimizing tax rate increases.

Highlights

Richmond Hill achieved a budget surplus for 2024, thanks to their top-notch financial team! 🌟
The meeting celebrated Richmond Hill's financial discipline, staying competitively low in tax rates while maintaining high reserves. 📈
There were discussions about positive contributors to the surplus, like aquatic program revenues and efficient winter maintenance. 🚀
Council praised the city’s fiscal health, but vigilant resource management is essential amid potential external economic challenges! 🌌
Future financial strategies focus on reducing residents' tax burden while ensuring necessary service and capital project funding. 👍

Key Takeaways

The City of Richmond Hill boasts strong financial management, achieving a budget surplus for 2024! 💰
A focus on tax stabilization helps safeguard against future rate increases, benefiting residents in uncertain economic times. 🚦
Effective resource management and capital planning are key to Richmond Hill’s fiscal success and future development! 📊
Residents can rest assured that Richmond Hill is navigating economic volatility with strategic foresight and careful financial planning! 🌟
Despite challenges, Richmond Hill is committed to maintaining high service levels with as low a tax increase as possible. 🌍

Overview

The City of Richmond Hill's Budget Committee meeting was a deep dive into the city's financial health, reviewing the successful outcomes of the past year and setting the stage for future financial strategies. Congratulations were extended to the finance team for managing a significant budget surplus in 2024, highlighting Richmond Hill’s competitive tax rates and strong reserve position! Through effective investment and resource management, the city continues to meet financial benchmarks that many can only aspire to.

The meeting’s agenda shifted to strategies for the upcoming 2026 fiscal year, focusing on maintaining the city’s robust financial health. Discussions highlighted the importance of using tax stabilization funds wisely to offset future tax increases, ensuring a steady financial footing despite external economic uncertainties. Council members expressed a commitment to fiscal responsibility, emphasizing strategic planning to meet citizens’ needs in service provision and infrastructure maintenance.

Overall, the City's financial outlook remains strong for 2026, with plans in place to address future challenges and opportunities. Richmond Hill aims to balance quality city services with minimal impact on taxpayers, a goal rigorously pursued through prudent fiscal policies and community feedback. The Budget Committee remains dedicated to navigating financial complexities with transparency and foresight, ensuring that the city’s financial practices continue to benefit its residents sustainably.

Chapters

00:00 - 00:30: Opening Remarks and Meeting Start The meeting begins with a welcome to all participants, with the chair calling the budget committee meeting to order at 1:30 PM. The meeting is ready to start with the adoption of the agenda.
00:30 - 01:30: Adoption of Agenda and Initial Discussions The chapter titled 'Adoption of Agenda and Initial Discussions' covers the adoption of the meeting agenda with unanimous approval. Councelor Silvitz moved the agenda, and there were no disclosed pecuniary interests or delegations noted. The chapter concludes as the session transitions smoothly towards scheduled business.
01:30 - 03:00: Preface and Introduction by Chair The preface and introduction by the chair sets the stage for the 2025 budget cycle meetings. It reflects on events from the past year, 2024, and outlines the plan for upcoming sessions, including a review of tariff fees in June and projections for 2025 in the fall.
03:00 - 06:00: Year-End Financial Overview by Treasurer Gigi Lee Chapter title: Year-End Financial Overview by Treasurer Gigi Lee. The chapter discusses the budgeting process for 2026 and highlights the excellence of the finance team at the city of Richmond Hill. Treasurer Gigi Lee expresses gratitude and admiration for the finance team, acknowledging them as unsung heroes who ensure competitiveness across various metrics.
06:00 - 12:00: Operating Budget Details and Discussion The chapter titled 'Operating Budget Details and Discussion' focuses on financial and fiscal management aspects. It highlights the city's strong financial position, noting that while it maintains a high tax rate within the Greater Toronto Area, it also boasts one of the highest per capita reserve positions. The discussion hints at positive financial developments anticipated in 2024, suggesting confidence in the management's ability to deliver favorable outcomes akin to hiring a successful stockbroker.
12:00 - 16:00: Water and Wastewater Budget Results The chapter titled 'Water and Wastewater Budget Results' discusses the financial performance of a government entity under legislative restrictions. Despite these restrictions, they achieved a double-digit return in 2024, which is considered quite remarkable. Several factors contributed to this success, though 2024 was noted as an unusual year. The discussion emphasizes the positive financial management and the pride the community should feel regarding their achievements.
16:00 - 19:00: Parking Fines and Revenue Opportunities The chapter titled 'Parking Fines and Revenue Opportunities' begins with a meeting involving the Treasurer and Director of Finance, Gigi Lee, who is ready to present the year-end operating results for 2024. The setting is a budget committee meeting attended by the Budget Chair Depal, Mayor West, and other committee members. The agenda includes three items, with two specifically concerning the year-end financial status of the year 2024.
19:00 - 21:00: Challenges and Financial Considerations The chapter titled 'Challenges and Financial Considerations' discusses the presentation of the 2024 fiscal year-end financial and operating results for Richmond Hill. This review is a crucial statutory requirement, providing an opportunity to evaluate the city's financial health and examine the management of public funds. Further details are covered under agenda item 5.1, including the 2026 budget strategy.
21:00 - 25:00: Discussion on Capital and Operational Forecasts The chapter titled 'Discussion on Capital and Operational Forecasts' provides an overview of the operating performance opportunities and challenges encountered. It focuses on how these factors influence the outlook for 2025 and the next fiscal year. The financial summary highlights the pivotal contributors that impacted the year, emphasizing that the operating fund is mainly financed by property tax revenues and user fees that support city services.
25:00 - 35:00: Tax Rate Stabilization and Reserve Discussion The chapter titled 'Tax Rate Stabilization and Reserve Discussion' discusses the budget process, highlighting how it serves as an operational plan for delivering quality services to residents and businesses. It emphasizes the adaptability required in financial planning, as circumstances may change throughout the year necessitating adjustments to both the plan and its financial implications. The document underlines the reality that actual financial outcomes often deviate from initial static plans due to unforeseen changes and requirements.
35:00 - 47:00: Councillors' Questions and Contributions The chapter discusses the financial status of a council's operating budget. It highlights a surplus of over $2 million with a proposed budget carry forward of $255,000, leading to a net operating surplus of approximately $1.8 million. On a total operating expenditure budget of $212 million, the surplus accounts for less than 1% of the budget, indicating a financial performance that aligns closely with the budgeted figures.
47:00 - 50:00: Closing Remarks and Adjournment The chapter discusses the importance of reviewing prior year budget variances. This review not only measures previous results but also aids in current forecasting and formulating the next year's budget based on recent experiences. The slide presentation shows that the budget surplus is comprised of both positive and negative factors, which will be detailed in the subsequent slides. The chapter concludes with a recommendation concerning the surplus.

Budget Committee Meeting - Tuesday, May 6, 2025 - 1:30 p.m. - City of Richmond Hill Transcription

00:00 - 00:30 Okay. Uh, welcome everyone. It's 1:30 and we'll, uh, call the budget committee meeting of the whole to order. Uh, we start with adoption of the
00:30 - 01:00 agenda. Somebody willing to move that. Thank you, Councelor Silvitz. Any discussion there? All in favor? Any opposed? Carries unanimously you. Okay. So would do any members have a disclosure of pecuniary interest? I see none. We have no delegations. We can we can move right into scheduled business. But before we do, I just I just want to
01:00 - 01:30 preface a little bit uh where we're at here uh before introducing our treasur. Um, this is our first budget meeting of the 2025 cycle and essentially it's a it's our a look at what happened last year in 2024. In in June, we're going to be looking at tariff fees and then uh we start back in the fall session with uh forecast for 2025 and then um get into the the
01:30 - 02:00 budgeting process for 2026. So So that's where we we're at. We're we're here. We're here again. And I just want to really congratulate this finance team. We we're so lucky and and we're we're really blessed at the city of Richmond Hill to have a top-notch uh finance team from from from top to bottom. This department are the really the unsung heroes that that uh you know make a lot of things happen. We are competitive on on a on a on every metric there is when
02:00 - 02:30 it comes to uh financial and fiscal management. um you know top top three always in in our tax rate um in the GTA but one of the highest reserve per capita position uh we we've got lots of good news coming out of 2024 I mean um if if you know if you wanted to to fire your stock broker and you're looking to hire our our team is manage
02:30 - 03:00 uh well under the legis legislative restrictions that they have and and and which which investment vehicles they're allowed to use. They they've managed a double-digit return in 2024. I mean, that's just I I don't know if there's any other government entity that can compare. Of course, there are a lot of uh a lot of factors that went into that and 2024 was a a a strange year, but um these these are all good news things for Richmond Hill. We should be very proud of our financial management. And uh with
03:00 - 03:30 that, I'm going to I'm going to allow our uh treasur and director of finance Gigi Lee to to to uh give us her year-end operating results for 2024. Thank you. Good afternoon, Budget Chair Depal, Mayor West, and members of the committee. It's my pleasure to be here today before the budget committee. There are three items on the agenda with two of them related to the 2024 year end
03:30 - 04:00 result followed by the 2026 budget strategy. There'll be two presentations. I'm here first to present the year-end financial and operating results for Richmond Hill for the fiscal year 2024. The annual review is not only a statutory requirement, but it's also a key opportunity to reflect on the city's financial health and assess how public funds were managed. Agenda item 5.1 provides the details of the year end results. In this presentation, we'll
04:00 - 04:30 walk through the highle operating performance opportunities and challenges that we faced and what this means moving forward into 2025 and looking ahead into the next fiscal year. Let's begin by looking at the overall financial summary and key contributors that shaped our year. The operating fund is predominantly funded through property tax revenues and user fees which are used to support city services. The
04:30 - 05:00 budget process produces an operating budget that provides residents and businesses with quality levels of service through the effective and efficient use of resources. The budget is a financial expression of a static plan based on known information at the time. Over the course of the year, circum circumstances often arise that change the plan and the costing or financials of the plan will also need to be adjusted. As a whole, actual financial results are unlikely to
05:00 - 05:30 perfectly align to those that were budgeted. Shown on this slide is a good news story. The overall operating budget surplus was just over $2 million with a proposed budget carry forwards of $255,000. The net operating surplus is approximately $1.8 million on an operating expenditure budget of $212 million. We were over 99% to budget with a surplus of being less than 1%. What's
05:30 - 06:00 more important to know is that a review of the prior year budget variances not only provides us with a measure of the previous year's results, it also helps us with current year forecasting and formulating the upcoming year's budget based on recent experience. As you can see from the slide, the surplus is made of positive as well as negative factors and I'll go into those in details in the upcoming slides. The surplus is recommended to be
06:00 - 06:30 allocated to the tax rate stabilization reserve and the WSIB reserve. This will help achieve the target balance for the tax rate stabilization reserve to offset one-time expenses and future fluctuations in tax rates. The allocation to the WSIB reserve fund is needed to help ensure adequate funds are available to address long-term liabilities associated with the city's commitment in this area.
06:30 - 07:00 The positive contributors are either higher revenues or lower expenses to budget. And this slide highlights the most notable ones totaling $7 million. Consistent with the prior year, we are seeing an upward trend on penalties and interest as a result of the tax receivables. The city has implemented a plan to reduce the receivables which includes reinitiating the full collection procedures as noted previously. The goal is to gradually lower the receivables and the amount of
07:00 - 07:30 tax rears over the next couple of years. Aquatic fitness and recreation programs were about $1.1 million favorable. Um it's largely due to stronger than expected fitness membership revenues as well as additional fitness classes. Also attributing to a substantial effort from staff in training and hiring casual staff that lead to an increase in aquatics instructional programming. The extended closure of the wave pool required the city to maximize
07:30 - 08:00 efficiencies by filling the programmable space at other facilities rather than opening an additional facility at suboptimal staffing levels. winter maintenance contracts were favorable due to milder winter in the beginning of 2024 and that entailed fewer contractor deployments. Um, also another recurring item is the payment in le of taxes related to the York region transit facility on Orlando Drive. So,
08:00 - 08:30 we continue to see that as one of our favorable um variances. Looking at parking fines, in 2024, the community standards division, they transition to 24-hour a day, 7-day a week bylaw enforcement coverage. This transition was possible by converting parking enforcement officers into community standards officers with expanded responsibilities and revised their shift schedule. The success of this conversion far exceeded
08:30 - 09:00 expectations, resulting in enhanced service delivery, improved staff engagement, and reducing sick time. And overall, about 613,000 more than forecasted in parking find revenues. Also looking at other revenues that were higher in 2024, the elimination of the collaborative application process and planning and the conversion of the cap submissions eliminated the deferral application fees. So overall we also saw an increase
09:00 - 09:30 in that area as well. We're also looking at a continue upward trend in commissioner revenues from lottery licensing. And then again similar to the year prior we did um observe lower wastage tonnage than forecasted when it comes to refuge collection. So overall we've highlighted the most notable contributors under the positive. So essentially these are all favorable experiences or variances to
09:30 - 10:00 budget. On the other hand, negative variance contributors reflect lower revenues or higher expenses to budget. When we look at the first line, it's um related to personnel gapping. These are typically savings primarily from vacancies, attrition, turnovers, etc. We do have a provision within the budget for gapping. In 2024, gapping was unfavorable resulting from a number of different factors including IT capital
10:00 - 10:30 resources to operating and to backfill vacancies as well as the fire shift premium costs as well as the overtime that was in the fire services division. Moving along, when we look at the roads contracts and materials, um we saw an increase in service requests associated with the implementation of TESOS, which is the transportation safety and operation strategy, as well as additional sidewalk repair work that was done through the financial control
10:30 - 11:00 bylaw. The cost of the wave pole was approximately $600,000 in 2024. The city identified um issues with the piping systems as well as piping failures that were the root cause of the leaks. So emergency repairs were done and uh it required excavation as well as repair of the piping and the pool basin. So that was done in 2024. We've been seeing a downward trend since the pandemic on supplementary assessments and supplementary tax
11:00 - 11:30 revenues or related to new properties and alterations or improvements. In 2024, we did see supplementary assessments that are lowered to budget. Um, we are experiencing a slowdown in construction and that's expected to continue into 2025. Highlighting the the QP strike related cost here. When we look at the the cost that's net savings, it's approximately $400,000. So this actually highlights
11:30 - 12:00 um the personnel cost as well as the non-personal cost that we have um incurred as part of the labor disruption active net. Um it's a little bit over budget by $221,000 and that's very much related to what you saw in the earlier slide with the higher uptake and more registrations. Um it did mean that our transaction charges related to active
12:00 - 12:30 net also increased as well for vehicles and and equipments um in fire. We did see some unexpected breakdowns and so there were more assets being serviced by external providers. That's why we're seeing the negative variance of close to $200,000. And just moving down the list, uh the library deficit. So there was a deficit in the libraries books in 2024.
12:30 - 13:00 Uh primarily as a result of the QP collective agreement as well as a transition of the CEO position. So staff are recommending that we fund this one-time increase and the grant so that we the the library um will will have a net of zero. And then last but not least, um there are a couple other items that are smaller in nature. So it's really a reflecting the the um day-to-day
13:00 - 13:30 variances when it comes to uh utilities. So as well as the staircase repairs that was actually approved as part of the um mid-year forecast report that was provided to council early in 2024. As part of the 2024 year and forecast, um we did have a staff report that identified these programs that would
13:30 - 14:00 have been considered in 2025, but they were approved to be accelerated and implemented in 2024 as a result of the forecast a year in surplus. So what you see here essentially are those three programs that were advanced utilizing the the anticipated surplus from the 2024 budget. Budget carry forwards represent unspent 2024 budget for initiatives that have either partially started or deferred for completion in 2025. As you
14:00 - 14:30 can see on this slide, overall the total is approximately $255,000 essentially to um carry these projects and initiatives to continue into 2025. Moving along to the water and wastewater budget results. Um the water and wastewater fees are collected from residents and businesses to help support the operations, maintenance and repair
14:30 - 15:00 of the water and sanitary system. These financial results are presented under the water and wastewater fund. So separate from the operating fund. Overall we are at about 97.5% to budget. There is a deficit of $2.4 $4 million that will be funded from the water rate stabilization reserve and it's primarily due to the higher percentage of unbuild water compared to budget. In 2024, the city was active in replacing several large water main projects that are commissioning
15:00 - 15:30 um of these water manes required an excessive amount of flushing to take place. This flushing of water is not meter and is not built as these are city projects. There were also 23 water main breaks in 2024 leading to a total deficit of $3 million. The deficit is partially as you can see on the slide offset by favorable investment income, savings and maintenance and operations as well as water metered contract services.
15:30 - 16:00 The storm water management summarizes storm water fee revenues um offsetting against the cost of maintaining storm water ponds, storm sewers and catch basins for 2024. We are reporting a surplus of almost 200,000 or just under 97% to budget primarily a result of increased revenues due to the amendment in property types offset by increased number of infrastructure repairs for the
16:00 - 16:30 rehabilitation of sanitary storm sewers. The surplus of almost $200,000 will be allocated to the water quality preserve fund. The slide here highlights the recommendations from the staff report. Mr. Chair, that concludes my first presentation. Okay. Thank you very much. Okay. Um, so I'm going to ask that some someone put the motion on the floor of
16:30 - 17:00 the the the staff recommended motion if they're willing to, and then we'll also open it up for anyone for questions. Uh, councelor tree. Yeah, I can move it. Do you have any questions or Yeah, I do have questions. Okay. Thank you so much our uh chairs uh our director Gile. So I I I think the positive result is we we got supplies from 2024 with $1.80
17:00 - 17:30 million. That's great achievement receive a lot of money here. Uh I do have a question because last year when we have these reviews I remember I have a slide here is regarding to the projection updated funding deficits in 2025 also next 10 years plus the cash contribution v projected expense. So from the project uh projection perspective if I look at last year's projections for the
17:30 - 18:00 budgetings just based on tax supported budget or forecasting our level what we got so far is is far lower than what they expected. So my question here is if I look at the back five years surplus maybe I'm wrong. So every year we do have a certain of surplus but from projection perspective every year we have big gap in the projection. So I'm
18:00 - 18:30 just trying to to find out where this gap come from. I'm not sure if you have this picture or not. This coming from last year. This is what you show us last year. This and this is the picture the projections. So you can see the right line here is in the middle. That's our tax based on budgetings. We are in the middle and also the top one we are far away from there if you're familiar with this chart.
18:30 - 19:00 So looks like from budgeting and projection perspective we are far um away because we are short of budgeting. So we need to find more money but from the resort looks like we have more surplus. I'm just seeing what's going on there. If you have more uh answers for me through the chair to councelor tree though I do want to point out the graph that you were just showing is specific to tax supported capital reserve fund as
19:00 - 19:30 well as is the CAS levy which is the capital asset sustainability levy and not so much tying to the operating budget like we're we're talking about the capital budget and the contributions and the expenses that are projected for tax supported program versus in this presentation I'm talking about the operating budget results for 2024 the operating budget so for the capital we're short with them
19:30 - 20:00 but for the operation we have some supplies is that what I understand correct because last year our resident asked me for a few big project uh based on the the project based on budget uh capital budget it looks like I'd say the chart I told them oh we have some kind of shortter fundings just from capital but from operation perspective we do have a years and years supplies so is
20:00 - 20:30 there any kind of balancing in between so can I shifting some supplies from operation to capital instead that my question council you're you're really you're really talking about two very very different things we're talking about shortfalls in our 10-year projected needs for our assets um you know our capital projections of what we need um we are we're we we're are probably going to have a shortfall but the money that funds our are our those assets um is is not all tax
20:30 - 21:00 related it's very different from the operating budget that we're um that we're discussing today and and the surplus I just just want to say is less than 1% we're we're 99% accurate when when we're predicting uh where we're going to be and and where we end up. It's $212 million total budget and you know to be within one or two million um is it it's it's not a great
21:00 - 21:30 um you know surplus or or or deficit. Um it's just uh to today's exercises to to what we do with that. Um you could probably do a much better job. I'll pass it to to you madame treasurer. It's through the chair to councelor tree. So so I would add that when we're looking at the operating budget, the surplus goes back to what we call a tax rate stabilization which is used to fund any
21:30 - 22:00 fluctuations in tax rate within the operating budget. Okay. on the capital side which I think will will be a little bit more clear once I go through the second presentation because it does have a similar slide to yours which highlights the tax supported reserve funds and the 10-year outlook. Okay, thank you so much. So I'll wait for the incoming slides. So another questions here is uh I I know because
22:00 - 22:30 every year end of year when we review our budgetings we got tons complaints from residents we resolve too much so I know we need to save certain of the uh the money for future for emergencies for whatever reasons for reserve so is any buffers we can just shifting a little bit I know it's only 1% even less than 1% maybe 0.5% of the beyond on our expected budgeting. I'm just questioning if we do certain have certain of the
22:30 - 23:00 reserves is there any way we can shifting a little bit to lower down the the in future property tax that that's my thought yeah consider please consider all that because this is in the year and third year we forward for four pound six pound 7 something like the prop tax I think everybody has the uh every family has struggle as well especially during this time and lot of business imp being impacted. Uh there are a lot of
23:00 - 23:30 pressures for everybody. So I just looking for all the council support also for our staff members support. Is there any way we can just lower down the property tax in the future a little bit and ease it up a little bit if we have enough uh reserve and also funding here? Thank you. Okay. Thank you, counselor. And and essentially your motion here, the staff recommendation is is is doing just that or suggesting to do just that. And uh to
23:30 - 24:00 transfer the bulk of this the surplus to tax rate stabilization reserve, which we're we're trying to get to 10% of our operating budget, which is a roughly $20 million. And and we're there. And and it's a real achievement, a real accomplishment that we've got that reserve healthy again. um and very important as we go forward uh to make to make sure we're safeguarding against future uh tax increases when there's unforeseen
24:00 - 24:30 circumstances. So, um you know, very comfortable that we're going that the recommendation is to go back to tax rate stabilization reserve because that's future um future pro protection against tax increases for our residents. Uh the next speaker I have is councelor Shu. Uh yes, councelor Shu. Thank you Mr. Chair and uh firstly uh
24:30 - 25:00 thank you for this staff report and I'm glad to see uh there was a surplus in overall last year. I think it's not just luck by the excellent management by treasury and your team. I appreciate that. Uh just a few question not harsh. Uh on slide number five, the biggest negative contributor is personnel gabbing as mentioned is not related to QP strike last year and uh is only uh about the overtime by fire it matters
25:00 - 25:30 like you mentioned before. Uh my question is do you think this issue can be easily addressed in the coming years and if it's only happened last year or it may it may be happen in the next few years I'm just concerned about this is it is it be addressed through Mr. Yeah, through the chair to counselor shoe. It is something that is being looked at and managed. So
25:30 - 26:00 definitely specific to some of the within personal gapping you just spoke to the overtime as well as the shift premiums related to firefighters. So, these are things that that we staff are looking into um hoping to address, but definitely there there's um there's some complication in that as well. So, all I can say right now is these items are definitely ones that staff have identified and that we'll have to further investigate and look into. Okay.
26:00 - 26:30 Um similar questions. Um was n number nine. Oh, sorry, eight. the negative variant. Uh we have a significant diversity this year over $3 million in the water and wastewater category uh due to the several water main projects. So the similar questions do you think this issue could be easily addressed in the coming years through Mr. Chair?
26:30 - 27:00 Uh through you Mr. Chair. So, so first off, I think it's important to consider that there's a a difference between uh the the projection being off and an actual problem related to like something that's caused an an expense. So, we we need to consider uh those two things. Um and and when we're reviewing and and uh trying to be more accurate in in future years, we need to consider both of those
27:00 - 27:30 things. Um, if you're looking for information specifically about the water and wastewater deficit, I would um is there is there a more specific question? Um actually I just I'm quite surprised by the significant deficit in this account water and waste water. So I just my question is could it be easily addressed or it will happen in the coming years and years again and again? That's my simple questions.
27:30 - 28:00 Right. So, so, so through your like I was saying, we would be working certainly to make our budget predictions more accurate. Um, if you're looking to know what specifically uh caused the deficit this year, that's the bullets that are listed on the bottom of the slide there. Okay. So actually compared to the balance in the water rate reserve fund, does this deficit of over 3003 million represent a significant portion
28:00 - 28:30 of the outstanding balance of the reserve? I'm just concerned about how much we have in the reserve and for over $3 million deficit if it will have a big impact on our reserve. That's my question through Mr. Chair. through the chair to councelor Shu. So prior to the 2024 year and results, we had a balance of $12 million.
28:30 - 29:00 Okay. So it's a one quarter $3 million deficit this year out of $12 million is one quarter of our reserve. Okay, that's my answer I want to ask. Thank you, Mr. Chair. Thank you. Okay. Thank you, Councelor Silvitz. Thank you, Mr. Chair, and thank you to our treasurer and her staff um and all departments who work on this. Um you, as
29:00 - 29:30 I second what councelor Shu was saying, superb work as always. I just have a couple of questions on slide five. Negative contributors, vehicle and equipment maintenance through you, Mr. chair, do we lease or purchase our vehicles and does that make a difference in how we may have to maintain them through you Mr. Chair?
29:30 - 30:00 Through you, Mr. Chair. Uh we do have a combination of both. We lease some vehicles and we purchase many of our vehicles. Um we are actually looking at currently right now how to optimize the level and whether we have the the optimal division between the two. Uh and it does make some level of difference between how we maintain them. Yes. Right. Okay. Thank you. Um it was just a query inside my head. Um thank
30:00 - 30:30 you. I I appreciate that clarification. Um through you Mr. Chair. Is there ever a point in time where we look at our vehicles and we say the fleet needs to be replaced or or is that something that is that that happens over time through you Mr. Chair? So we don't look at it collectively as the entire fleet. We have each vehicle uh individually is
30:30 - 31:00 is an is an asset in our asset management database with a life cycle. And when that life cycle comes up, we assess whether it needs to be replaced and put it in the capital budget for replacement. Okay, great. Thank you. That's that helps me. Thank you. And then my my second and last question through you, Mr. Chair, is the next line down library deficit funded from city grant 1366. Um I didn't quite understand that. Um Treasury Lee, can can you explain that again? My apologies, but I
31:00 - 31:30 just didn't quite get that through the chair to councelor Solifford. So on an annual basis as part of the operating budget um the city does provide a municipal grant to the library to fund um a majority of their operations. So what happened in 2024 was as a result of the QP collective agreement. So, the the actual increases versus the budgeted increases as well as the transition um with the former CEO to
31:30 - 32:00 to the new CEO, we did experience overall a deficit in the library's operating budget. So, you can imagine for the city when there's a surplus or deficit, we have the tax rate stabilization reserve. In this case, the recommendation from staff is that we increase a one-time grant of $136,000 in addition to the municipal
32:00 - 32:30 grant so that um they they will not have a deficit. It's it's one time in nature. And I would say in in the the history of of the library's operations, I would say this is actually the first time we've experienced and due to the the reasons I've noted earlier. An anomaly. Yeah. Okay. Thank you. That's what I needed to know. Thank you, Mr. Chair. Thank you. Okay. Thank you, Mayor West. Thank you. Uh thanks for M Mr. Chair.
32:30 - 33:00 Uh, I want to talk a little bit about the tax rate stabilization reserve because I think it's maybe a little misunderstood and I I suspect that uh maybe people in the public don't uh fully understand it, but I wonder if you could just add a little bit uh to that narrative. Um, can you just remind me and and everybody else on council, um, what have what have been the general trends in the tax rate stabilization account over the last, you know, maybe going back to the beginning of last term
33:00 - 33:30 of council? Like like how is that what would that graph look like in terms of that the the balances on the tax rate generally speaking the tax rate stabilization reserve? It's through the chair to the mayor. So I do have data going back to 2020 which would be the previous council. Um in 2020 our opening balance was $6.8 million. Um and then 2021 6.7. So over the last few years through some of the
33:30 - 34:00 opportunities that we've had with the surpluses with um some of the funding that we got through CO from the higher level governments as well as the investment income um it helped us repopulate and improve and increase that balance. To the chair's earlier point we do have an internal guideline of 10% over operating. I noted our annual operating for 2024 was 212. So 10% of
34:00 - 34:30 that would be $21 million. So since 2020, we have been able to increase the tax rate stabilization reserve from 6.8 to the $18.4 million with the recommendations that staff has provided for the transfer of the 2024 surplus. Okay. is when did it hit 18.4
34:30 - 35:00 with this uh with this staff report. So at the end of 2024, okay, with the transfer we would hit 18.4 before any draws or any transactions in 25. Okay. So, and the important thing I I think it's important to remember too is before the 2020 time frame that you have the data for, uh, we were using the tax rate stabilization account to artificially I I'm using that in air quotes, but artificially lower
35:00 - 35:30 the tax rate almost every year since I've been on council. Um, and the you know, we did that for a number of reasons, but the thing is that that made the balance in the tax rate stabilization account go down, not up. And the reason that we have the tax rate stabilization account is that if we have any sort of a major unexpected expenditure, which we could, and and in my time on council, I know the ice storm, you know, hit in 2013, I guess, early in early 2014. And if I'm not
35:30 - 36:00 mistaken, that cost us about 6 or 7 million. That wasn't budgeted for because we had no idea that that was going to happen. Had we not had uh a a stabilization reserve, then what would have happened is the the taxes would have gone up in the next tax year, $6 whatever million dollars that it costs us. So this reserve fund helps us to even out some of the unexpected things that might happen. And so I think it's really important and I I'm sure that this particular move on our part isn't
36:00 - 36:30 the, you know, the most flashy thing when it comes to the budget. like it's not going to be the headline uh in the story, but I think it really is the foundation of one of the many things that we do in the city of Richmond Hill around really sound fiscal planning. It's essentially money not for well actually it is kind of money for a rainy day, but I'm talking about climate change rainy. like if something if we had a really big flood or something like that happened, we could count on this reserve fund to make the repairs, make
36:30 - 37:00 the repairs quickly and it have it not impact directly the tax rate for the the next budget. So that's the important thing. So, it's taken us a long time to wean oursel off the temptation to use it, but also to get us back to a place where the the the uh balance in that account is high enough that we can count on it to be useful. And that's where we are today. So using uh fiscal prudence
37:00 - 37:30 and and using some of the surpluses which you know we didn't obviously expect um and as uh chair depo mentioned some of the the successes that we've had with some of the investment uh that we've we've we have uh to replenish that account so that we're back to a place of of more of more sound uh financial uh position. So I think that's really important. Is there anything else treasurally that um we have used the tax rate st for in the last few years? Like
37:30 - 38:00 I mean I'm not looking at little bits and pieces but is there anything else other than the the ice storm that stands out in in its recent use? Through the chair to Mayor West. So over the last little while we have been um occasionally using this reserve for one time item. So, I can talk to the community improvement program grant. So, that's $350,000 that we're drawing from the tax
38:00 - 38:30 reabilization to um for that grant program. Uh we do have uh some internal core services reviews um some within my sections. We talked a couple meetings ago about some of the continuous improvement projects. So, there's also a one-time budget to pay, which is a one-time program um that we're using the tax rate stabilization to provide for
38:30 - 39:00 and all of those programs are creating dividends. That's correct. For our city as well. So anyway, I I just think I I think it's important for us to understand this that um you know, getting the tax rate stabilization account to a level I mean, we're not going to it's not going to grow forever. We're not going to you know, keep putting money into it until it's you know, 20 or 30 or 40% of our budget, but it's it's an amount of money that we can count on to be able to leverage and use when when we need it. So, sorry, did you want to say something? The chair, if I
39:00 - 39:30 can just add one more point. Um the mayor's correct like we have been able to take the opportunities over the last couple years to help build up the reserve but as we know the Bank of Canada interest rate is it's almost half of what it was a year ago right so things are going to change and this is why it's important that we do have that buffer or we do have the flexibility within the reserve for any unexpected changes going you know in the near future right but you know I'm touching
39:30 - 40:00 touching wood as I'm saying this. If we don't get a disaster between now and say the next budget or the budget after that or the budget after that, um we like next year's conversation here probably won't include a substantial contribution to the the uh rate stabilization uh reserve because we're we're getting very close to the target of 20 something million. But when we were having the conversation and the tax rate stave account was only $6 million or
40:00 - 40:30 6.8 versus today there's, you know, there'll there was a whole lot more urgency to get us back to where we needed to be. Now we can kind of, you know, take our foot off the gas pedal a little bit because we are roughly, you know, at our destination. So anyway, that wasn't uh that was just the only thing I I specifically had to ask. I thank you for all the work that you do and your your staff, Gigi, because I think uh you know, we're very lucky to have such a thorough uh analysis of the
40:30 - 41:00 uh of the budget documents and and this uh report specifically um is a very interesting one because it kind of says how we did. So, thank you very much. Thank you, Deputy Mayor Chan. Thank you very much, Mr. Chair. Um I'd like to begin with by uh I guess all of us who have spoken said that thank you so much for the great work been doing year after year. Uh I've been sitting council 19th year I my recollection is almost every
41:00 - 41:30 year at the end um of the looking back um is almost we always have a surprise whether it's big or small. So this is a press uh as mentioned about is 99% on track. Uh this is uh great. Um now I'm I'm just curious like um I know that was talking about only 1%. How's that $2 million of surplus uh if we put in a tax
41:30 - 42:00 points uh what would that be through you Mr. Chair? Roughly roughly one and a half 1.5%. Yeah. 1.5% roughly. Okay. So like personally I I is it's not the amount may be small but if you look at that weight percentage wise 1.5% is quite a bit. uh but of course you know we cannot uh predict year after year and
42:00 - 42:30 uh and today we're not talking about moving forward but looking back but potentially in the future we can look at given I think kungu tree kind of touching on if you look at three year five year even 10 year record we consistently perform well and outperform as projected perhaps there may be a little bit of cushion look at in the future but that's for another time now coming back to what we have in 2024. Um it's great we have all those positive
42:30 - 43:00 contributors. Now what my concern is I like to hear the thoughts from our treasurer um through Mr. Chair. Um some of the positive contributors we kind of thought is a one time only uh last year or even a year before last and specifically is one on the York Regional Transit the payment in of taxes and um well it's fortunate for us we keep getting it the 600 gram or so on um is
43:00 - 43:30 that any sense that um for you Mr. chair to the treasurer um you would know um or anticipate that might change in the years to come or or how to say would like to hear that chair through the chair to deputy mayor Chen so you are correct in that the payment of taxes that favor variance has been a recurring item over the last few years um reason being there are ongoing discussions between the region and the province to
43:30 - 44:00 make regulatory changes to exempt the facility from property taxes. So that discussion has been ongoing for a number of years. Every year we do a follow with the region. That is still the status. So we don't want to include this in the budget because you know next year or the year after it could be gone. So we don't want to we want to make sure we're conservative. So that's why we continue to report. It is a good news story. We continue to benefit from it. Um but we we don't know when that's going to change because as I mentioned earlier
44:00 - 44:30 it's um a discussions discussion between the province and the region that are continuing. Thank you. Yeah. So I I think that uh is fortunate for city of Richmond Hill for the over a few years time. We always well I say always we have been getting that $618,000 um but potentially it might be gone you know in next year or year after um I don't know is something that um can
44:30 - 45:00 we touch on maybe in the next item or agenda items. Um, it's good to have $39,000 more money from the refuse collection recycling contracts, but potentially that positive um variance uh favorable to us might might not necessarily be there from 2026 and beyond. I'm just saying that I don't need any comments. So So the point I'm
45:00 - 45:30 trying to get at is great. have all these positive contribution this time but in a good number of them we cannot really rely on them and I I think that's um uh goes show that our team again have to really do their best to provide some room for accommodate those potentially um nonrecurring if I may say so positive contributions um I just want to clarify some things and thank you Mr. care in
45:30 - 46:00 full support and always good to have sherpers and I have no trouble that money go to the uh tax uh uh the stability um the u uh stabilization fund actually I before I still have time I just forgot one thing is about the WSIB I've been talking to my municipal colleagues they all seem to saying that this could be potential major thing to consider um so I wonder to the extent that uh you could comment uh for Mr. Mr. Chair, um last year we we're fortunate
46:00 - 46:30 so to speak, but is that something it could give us some sense that we have to look for maybe have to budget for more money coming year? WSIB through the chair to deputy mayor Chan. So this is something the staff has identified since the 2022 actuary review and we are doing an update of the valuation in 2025. So definitely it's an
46:30 - 47:00 area that that staff um are looking into. I do want to point out that since the 2022 actuarial review, we have been increasing within the budget uh um we have been gradually increasing the contribution to WSIB. So we're not just looking at when there's a surplus the transfer them. So within the budget process itself we have identified that and year-over-year we have been adding
47:00 - 47:30 those contributions to make sure we are able to bridge that gap but as I mentioned earlier uh in Q4 of this year we are going to be undertaking an updated actuary review and evaluation. So so uh an update on where things stand and and how we would move forward. Okay. Thank you. Yeah, I I can see we have to keep that reserve healthy because I can see that coming in the years to come. But for last year, good news. Good news. Good news. Thank you.
47:30 - 48:00 Thank you. Okay. Uh councelor Leu. Um thank you, Mr. Chair, and thank you very much for the presentation. Uh thank you for all the hard work. Um just very quick, um I apologize if you have already explained um the staircase repairs on Saigon Trail. Um, it's a $100,000. Um, it's got my attention. Is it is it considered expensive to just for
48:00 - 48:30 staircases? Staircase. I'm just curious through you, Mr. Chair. Through you, Mr. Chair. So, the reason this is listed is because it was not anticipated in our forecast of operations and maintenance needs. It was something that came up. Um, so that's why it's an additional deficit um over a a threshold value that we we use to report things of significance. So So it's not out of the ordinary. It was just that it wasn't we
48:30 - 49:00 didn't forecast that we were going to need to be it we were going to need to do it in 2024 and then we did. So it's coming out as a a deficit cost. No, no, I understand. I'm just curious about why is this so expensive? H okay. So, um through you, Mr. Chair, I I don't think it's unusual. Um it's a pretty significant staircase and uh it needed to be totally replaced because it was dangerous. Okay. All right. Cuz when I when I look
49:00 - 49:30 at page six, $84,000 for sidewalk repairs and and $100 $100,000 for a staircase, it just caught my attention. So, I it is what it is. Okay. Fine. Um next question is uh page six accelerated programs. Um so this is when we have surplus and then we decided to accelerate these three projects to to have it complete ahead of time. Is
49:30 - 50:00 it my correct understanding through the chair to councelor Louu? Um if that is correct. So through our midyear operating forecast process in 2024 um we did identify and anticipate a surplus amount. So then we did recommend through that process to accelerate some of these
50:00 - 50:30 programs um which you see on slide six. So those were recommended and approved so that we were able to undertake those projects in 2024 instead of 2025. Okay. And it was approved by council, right? I can see that. Correct. All right. So, all right. Thank you. That's all my questions. Okay. Thank you. Um I don't don't see any any other uh speakers or questions
50:30 - 51:00 at this time. Uh well, I just want to speak briefly to the motion on the floor. I I really think uh it's very prudent the recommendations of our staff on where we're going to direct the these the surplus funds. Um it was it was noted that WSIB is a deficient account and we're we're catching up there. And then of course the it was already mentioned by the mayor about the mill rate stabilization and we we we've tripled the the the real number of the
51:00 - 51:30 balance in in just just three years into that account and and we're not going to have to do that uh in the future. We're we're almost at the target. So that's that's going to give us a lot of flexibility should we again um you know have an opportunity um to have a surplus. I I I actually have a question. How much did we budget to contribute to mill rate stabilization for 2024? There was a there's a budgeted amount. This is an in excess of or do we budget for
51:30 - 52:00 that? It's true to to the chair. Um we did budget an amount in 2024 and that's because we did anticipate a a higher than usual investment in income. So at the time when we were doing the budget for 24, we did anticipate roughly that we would transfer $3 million which is entirely related to investment short-term investment income. So that was in the budget.
52:00 - 52:30 Yeah, that's what I thought. So yeah, so this this additional million dollars is um you know in excess of what what we budgeted and we we had an opportunity to do that. next time we anticipate getting $3 million extra. Um, you know, that's that's not going to be the target. It'll be something else. So, we're we're in a good position and a um a lot of it is is things that that you you just don't see. and being um
52:30 - 53:00 being being careful with the with the funds that we have and and keeping these these reserves healthy um makes us not not have to come together as a council to deal with things that that could be a crisis. Uh our our wastewater, you know, there there's no way of anticipating we had excess flushing, you know, we had to clean out our systems. We had to use water for that. There's there's leakages that are being repaired and being addressed, but um you know, we pay a certain amount for water and the the
53:00 - 53:30 region, you know, the region bills us for how much water they give us and then and we we collect how much we um we pass on to our, you know, residents and users and and and we we're on the hook for the difference. So instead of assembling as a as a in a in a panic or as as a crisis, no, we that that million dollars we don't even um you know that's it's it's just a line on in a presentation
53:30 - 54:00 rather than rather than a real concern. And um and that's what it would be if if our mill rate stabilization accounts, our reserve accounts were not healthy. We'd be in here every day saying, "Oh no, the strike cost us $600,000 and WSIB needs another million dollars and wastewater needs a million dollars." We'd we'd be going from crisis to crisis if we didn't have um that that good management that that we're we're fortunate that that our staff is um you know, always always
54:00 - 54:30 looking ahead and budgeting. So I congratulate you for that. A good year for 2024. And um and then I I have a question about 20 2025 when when we do that midyear analysis is that June or September when we when we look at where we stand and maybe have accelerated projects or to the chair. So that process takes place in September. So we would come back at the September BCW budget
54:30 - 55:00 committee of the whole with um the midyear forecasts based on June results to 2025 year end. Okay. Very good. Okay. Yeah, that that's what I thought. So se September, we're going to take a look at what's happening this year, where we stand, and then um you know, it's it's it's a very critical year as we go forward with the budget. I my hope is to really give our our residents a a break if we can. Um, I I know so many people are struggling. They're they're getting hit
55:00 - 55:30 on it everywhere they turn with rising costs of of living and, you know, life becoming more and more unaffordable and we just don't want that the property tax bill to be another hit for them. So, this year we have a a real view to trying to keep um, you know, our property tax rate hike as as low as absolutely possible. I think this this term of council that that we've done a really good job managing and we should be in the position to to perhaps um
55:30 - 56:00 relative to other municipalities um help our residences residents with a you know a a very modest tax increase versus what may they may be experiencing elsewhere and other municipalities are going through. So um that's where we stand. I think councelor tree you wanted a second round. You wanted Okay, go ahead. Okay. Thank you so much, Mr. Chair. So uh I I do want to comment on follow up the waste water and also the
56:00 - 56:30 storm water uh the the the the datas here. I remember last year we had tons of discussion regarding to the storm waters and back and forth and also the ris farmers come back to us as well. So uh my questions here based on the 2025 ref maybe refresh my just my knowledge understanding for storm water based on last year's adjustment. So, so far for 2024 we're okay. For long-term
56:30 - 57:00 next five years, do we see any major uh major deficits here or do we see any major changes here? I forgot because this is really half a year ago. I need to refresh my memory. For storm water part, we keep the current approved uh ratios for next few years. Is there anything you can see is diff quite different or similar as this now
57:00 - 57:30 through the chair to councelor tree. So in November of last year council approved the storm water management financial plan that essentially is a financial plan that covers the the the needs the city's needs when it comes to storm water infrastructure for the next 10 years. So within that financial plan, it identifies the infrastructure needs, the operating costs as well as the projected um storm water management rates that are required to support this program. So
57:30 - 58:00 that was also approved. Um with respect to the changes every year in April, that's when the the water wastewater as well as storm water rates increase. So in April of this year, we also um started billing at the 2025 rates. With respect to the structure that was approved, um we did have a couple rounds up until
58:00 - 58:30 the November before last. Um so we do have a rate structure that's been approved by council and in place. Okay. My next check regarding to the water and waste water budget. I see this is really big that is $2.4 million dollars here. So uh still have same question as well. So um I know last year we approved certain of the motions carried forward to balance this
58:30 - 59:00 water budget. I remember one of the consultant come here to have had a a meeting with us as well for the report regarding watering. So for from your understanding is the water and waste water are we still short of the deficits is there any long-term we still have need more uh monies for to meet this this objective just from the water and basil water perspective are we still seeing deficits in next few years too I
59:00 - 59:30 think that was answered we we've got a plan going forward we're trying to get more accurate yeah yeah that's right I just say the status through the charity to councelor tree. So I'll share the a very similar response to what I just mentioned for storm water. So essentially council did approve last June the water and wastewater financial plan. Again it identify the infrastructure investments that are needed the operating costs as well as the 10-year projection of those rates. um we're we're still on track and
59:30 - 60:00 I would say um that is the function of the water rate stabilization similar to the tax rate right um when we have a surplus we would transfer it in um when there's a need for to to find a deficit we would so so that is the function of the reserve um for the most part I I would say um that that the deficit it's it's one time in nature um we're definitely looking at um managing ing the budget and looking at what other um
60:00 - 60:30 opportunities we have in 2025 and moving forward. Okay, thank you. So, we're just because it's middle of the middle of the year, so we're just trying to see the updates and see how that goes and we can keep monitoring and the progress and hopefully after a few years this can be balanced out. Thank you. Thank you. Okay, thank you. And um yeah, so we have we have to remember we're talking about variances here. where we we budget um to
60:30 - 61:00 you know be impacted by all all these different areas. The the water and wastewater is a a big line item uh that it's a it's a flow through the you know the region uh we we administer the the the accounting on it. Uh you know we we pay for the water then we sell it to our residents and that's a it's just just large amounts. So there there's going to be um you know year year after year a large that'll be the one of the largest items plus or minus uh and that's going to
61:00 - 61:30 happen. But I think overall these variances are are just are excellent because they're um so so accurate when when you consider that they're with 99% accurate of what we're going to spend. Um but the variance is on the positive side because of that conservative approach. Um the fact that we're not counting on the region paying property taxes when we know they're in negotiations to to get relief from the province. the fact, you
61:30 - 62:00 know, just in each and every line item. It's to be as accurate as possible, but it to air on the conservative side and and make sure that we're not um here facing a deficit and wondering where we're going to find $2 million instead of today where we've got a budget from a motion from from council tree to allocate two plus million dollars to uh the recommended funds. So, with that, a motion on the floor. All in favor? Any
62:00 - 62:30 opposed? That carries unanimously. Okay. Thank you very much. Now, now we move to the next item. And it's curious that there isn't a presentation on this one. There, there should be. I think our financial staff's pretty humble, not not to be bragging and boasting with charts. I I I would be uh I'd have a I'd have a big chart showing how well they they did with our investment income portfolio, but um you know to uh it's it's just it's just here
62:30 - 63:00 in front of us as as an item uh for for information purposes and um we're near nearing 10% on the mark tomarket amount or you know portfolio the five and a half% return on it's just good news that can't be expected to continue but uh but uh good news and part of the big part of the reason why we're in a in a positive variance favorable position today. So is there's someone willing to move that
63:00 - 63:30 receipt of that information. Councelor Tree. Okay. Any discussion? Oh yes. I moved to 5.2 now. So and scheduled business. Oh go ahead. Yeah, Deputy Mayor Chan. Thank you very much, Mr. Chair. Uh I I was anticipating a a presentation, too, so I'm hesitant to raise my hand. Uh and um I know we are only setting directions. Um and you know there's so
63:30 - 64:00 much uh thing might be within our control, less than our control. Um is just to be very clear, Mr. has a motion as stated on the report uh um SRCFS 25.17 being moved. The recommendation been moved already. Is that correct? We've got a Yep. The motion on the floor to receive. So, sorry. I think through the chair, I think we're referring to do two different agenda items.
64:00 - 64:30 Oh. Oh, I'm sorry. Yeah, I'm we're on the investment one, which is my my my 5.2. My apology. Yeah. Yeah. I'm interested in the other one coming up later. Thank you. Sorry, I withdraw my uh request to speak. Okay. Thank you, Mr. Let us know when you're ready. Um so, yeah, we're on 5.2 in the in the scheduled business. We've got a motion on the floor to receive the investment portfolio results. Any any questions on those? Okay. All in favor? Any
64:30 - 65:00 opposed? That carries unanimously. Okay. So, item 5.3. Um, now we have a presentation up to 20 minutes from from our treasurer regarding our capital and operating budget strategy going forward. Take it away. Thank you. This second presentation will focus on the upcoming budget cycle identified in agenda item
65:00 - 65:30 5.3. The objectives of the agenda item are highlighted on the slide. I'm here to provide the budget timelines for the 2026 budget process, highlighting some of the anticipated bud budget pressures the city will face, and also to seek the committee's approval on the staff recommended guidelines and strategy for the 2026 capital operating as well as rate budgets. As we know, strong mayor powers for Richmond Hill came into effect back in
65:30 - 66:00 2023 in July, and the city undertook two budgets already under these new legislative changes. To comply with the municipal act, the mayor has directed staff to commence on the 2026 budget process via his mayoral decision shown on the slide. specifically balancing the financial pressures on the city, including the need to build and maintain infrastructure and to continue to deliver important services. The direction also directs staff to review
66:00 - 66:30 spending and finding efficiencies to ensure financial prudence and to ensure alignment with the city's strategic plan. Furthermore, to continue with the process of consulting with the budget committee of the whole on the preparation of the draft 2026 capital and operating budgets for deliberation in the fall. To that end, the mayor has directed staff to continue to work collaboratively with all stakeholders, including gathering input from members of council, staff, and the public, and
66:30 - 67:00 to follow the processes that are generally conformed with previous business practices as well as the provisions of the act. The timelines for the 2026 budget and other financial processes are shown in this table. The 2026 budget strategy is being presented today, followed by the 2026 user fees review and update in
67:00 - 67:30 June. In September, staff will present the preliminary results of the budget engagement as well as we talked about this in the earlier presentation, the interim financial results or the operating forecast for 2025. In November, staff will propose will present the proposed budget to the budget committee for deliberation and recommendation to the mayor and the mayor will then table the 2026 budget on
67:30 - 68:00 December 10th. As endorsed by council through recommendations of the 2025 budget survey results report, any future budget engagements will continue with an online survey to solicit feedback. In addition to promoting the budget and its overall process through various digital and social media channels, an online survey will be launched by the end of May and will remain open for three weeks,
68:00 - 68:30 focusing on key themes from the budget direction. The results will then be shared with budget committee of the whole in September, allowing for considerations ahead of the 2026 budget discussions. The city's capital budget and forecast is a continuous and annual process. We're always looking at the next 10-year horizon. We'll continue to utilize the funding envelope approach to ensure financial sustainability. The capital
68:30 - 69:00 budget will be informed by the asset management plan, other master plans and studies along with the recently adopted rate supported financial plans to invest in the city's infrastructure. We'll continue to prioritize capital projects based on a matrix that factors in strategic priorities, regulatory needs, as well as asset management risk assessment. And we'll identify immediate capital investments needed with the goal to provide council with insights into the longerterm capital
69:00 - 69:30 requirements. The funding envelopes are shown in the table on the slide with more details on the upcoming slides. Staff developed a tax supported funding envelope by analyzing the projected expenditures based on the 2025 capital budget forecast, indexing it to mimic um the annual non-residential construction
69:30 - 70:00 building price index with a cap of $34.5 million. staff forecasting a positive reserve fund balance throughout the capital forecast period. So I do want to point out um this was the the slide that was shared um by councelor tree earlier that highlights the the gap in the tax supported funding for capital. As mentioned earlier for rate supported capital the strategy will be to follow
70:00 - 70:30 the principles of the water wastewater as well as storm water management financial plans. So as you can see we've highlighted the envelope amount based on the work that we've done through the financial plan process and these are going to be the the envelopes or the upset limit of what we will include in the capital budget. For growth related capital, staff are
70:30 - 71:00 proposing funding envelopes similar to what we did last year to acknowledge the residual impact of bill 23 and 10 185 as well as the lower than anticipated growth. Recent trend does suggest DC applications will be less than the growth forecast due to the rising construction costs, a shortage of workers, and the high interest rate environment. The capital program will be evaluated with these factors in mind and the timing of growth related projects
71:00 - 71:30 will need to be realigned. Identifying some of the potential challenges that may affect the city's ability to implement its capital plan as well as to sustain infrastructure development and maintenance. So what you see on this slide is we've highlighted some potential challenges including limiting or limited financial resources any emergent needs and external circumstances. So over the last little while we have been hearing a lot
71:30 - 72:00 about um US imposed tariffs and the potential impact. And then last but not least um a shift in political landscape um can create some uncertainty for external financing. Um over the last little while we have heard of um some of the the higher level governments and and their platforms and for the most part they they have been uh discussing um consideration of reduction in DC's
72:00 - 72:30 which will impact the DC collections for the city and our ability to deliver on capital. Turning our minds to the operating budget, what's shown on this slide is the 2026 outlook that was provided as part of the 2025 budget and a comparison with the approved tax rate and budget for 2024 as well as 2025. Appendix C from the staff report
72:30 - 73:00 presents the financial outlook prepared as part of the process which outlines the financial pressures from the various cost categories. It reflects the need to sustain service levels while addressing budget pressures, wage settlements, rising commodity costs, as well as property assessment growth. Staff aim to manage costs through fiscal responsibility and operational efficiencies to reduce the 2026 tax rate increase. as well. In
73:00 - 73:30 order to keep in line with the budget direction and propose a budget below the 2026 outlook, vacant positions will be considered for repurposing or possible in lie of new staffing requests. This slide highlights some of the impact considerations for the upcoming operating budget. As you can see, um, both internal impact as well as external, these will all in some way impact the the results or the the draft
73:30 - 74:00 operating budget that will be presented. As always, staff have identified a list of mitigating measures and will continue to add to the list throughout the budget process where possible. Um, so as you can see, I think this goes back to some of the comments that were made in the earlier presentation. We're looking to align budgets with somewhere over 2020 for actual experiences and financial trends. I talked about the vacant positions
74:00 - 74:30 earlier. So again, any one-time budget impacts, we'll utilize the tax rate stabilization reserve for uh we'll continue to look at the phasing in of of the investment income strategy along with potentially prolonging the impact or the phase and impact of the public works enhancement program as well as the new firefighters that were added in 2020. We'll always look to maximize revenue opportunities through cost recovery and then as always reviewing
74:30 - 75:00 city operations for service level and pro process changes and really just looking again at all any opportunity to generate savings and efficiencies. Similar to the capital budget strategy that I noted earlier, the rate budget strategy will be to follow the principles of the water wastewater as well as the storm water managed financial plans and the rates that are identified within. So you see that on
75:00 - 75:30 the slide chair the pallet that brings me to the recommendations of the report over this slide and the next and that concludes my presentation. Okay thank you very much. So again, um very early outlook in the at what we're going to be facing in 2026. Um we've got
75:30 - 76:00 a long way to go, but uh thank you for that presentation. Are there questions on the presentation? Deputy Mayor Chan, thank you very much. Uh I agree with you. Uh Mr. Chair, it's still a long way to go, but we always do it uh usually in June. Actually, we're early this year. uh you compare other cycle and I appreciate uh the treasurer setting out you know all the things consider and uh I have I'll be remiss if not saying that appreciate mayor west because uh this is
76:00 - 76:30 opportunity as one of the slides mentioned that uh for the mayor to take into consideration of the recommendation from this budget committee the whole at the end um so it's always a balancing act no doubt about that um I I'm looking specifically I think there is a number page uh slide number 23 um I oh no sorry maybe that's from last okay it is um that shows actually
76:30 - 77:00 operating budget outlook that I I like this one because it sets out in a threeear span what has been some of the changes um now of course we have to wait till this time next year to look at how the actual variance for 2025 budget uh but I I I do understand like this year the tax rate increase is the lowest among the three years well it's shown on here and
77:00 - 77:30 um and if it's appropriate uh Mr. care that um is that tution to move the recommendations at this point in time it was in one of the slides right yes uh so I would like to move the recommendation and I believe it on slide there's no numbers but last two pages anyway but um with uh my cause indulgence I would like to propose to add a under C additional
77:30 - 78:00 cross 7 uh if I can read it vote uh oppose a tax rate increase target that's a word of 3% excluding the capital asset sustainability levy. Now if people say is this new no certainly not new uh the very bud first budget of this term on June 27 2023 this clause was passed at that time
78:00 - 78:30 the budget committee hold June 27 2023 and I hope now it doesn't really tie our hands in any way we come in 2.5 or 3.1 whatever uh but in my u view and also chair Dep Paul also mentioned it is is really um tough time for a lot of residents as well. So I think setting a target a target and of course uh we'll see how in the end uh whether in fact
78:30 - 79:00 that can be fulfilled or not but sets out what um the direction we would like to uh go. Um so in that regard uh that's my motion including clause C7 which is the same identical wording as was adopted by the budget committee of the whole back in June 23rd 2023. Thank you. So there's there's motion on the
79:00 - 79:30 floor then uh other speakers mayor West you're next. I wish that uh regional local counselor Chan had bothered to talk to me about his plan to do this, but that's I guess what it is. Um so the whole idea here um with this process that we've set out was that we're if you read the the uh the the mayoral direction that I'm required to do use you know that's the only part of
79:30 - 80:00 the strong mayor powers that I'm actually legally needing to exercise. It says that we're going to be basically looking for the lowest uh tax rate possible and I actually would like to see it even lower than 3%. But as you said at the very beginning, um we are um in a long process right now and and there's lots of different pressures and things that that we have. So doing this right now is not tying anybody's hands, but it's I mean there's no value to it.
80:00 - 80:30 I mean the idea here is that we're going to try to get the budget increase as low as we possibly can. So in a lot of ways I believe this is micromanaging the staff and uh I I I mean it doesn't matter I suppose in a way whether we pass this or whether we don't pass this but what I would say is that the intention of this process which we've engaged in in you know in good faith with the council and the rest of the
80:30 - 81:00 community at the very beginning of this is to find out exactly what it is that the community needs what the council hears from the community and there and then we will go forward with the the lowest tax rate increase that we possibly can. Um but at this point in time I I don't see that that uh clause number seven actually puts a lot of value to it and it kind of changes the conversation as to how we're going about because really what we're looking to do
81:00 - 81:30 here is to get it as low as possible. Putting a number to it right now doesn't really add anything to the conversation. So, um that wasn't what I was planning on talking about, but um given the time that we have left, um the the process that we have in place uh here, I just want to be clear. Um I really do value what uh members of the public and what members of this council bring to the table throughout the mayoral process.
81:30 - 82:00 So, or through the budget process. So using the strong mayor powers, I want to just assure everybody that the process will still be the same as we've always had before. I mean, we're streamlining it and we're making it more efficient and getting our budget um approved much earlier than we have been in the past. And this is improvements that we've made since the beginning of this council. Um but we do need to make sure that we're maintaining the service um given the challenges that we're facing and frankly the challenges that people are facing in our community that we hear about all the time with regard with regards to
82:00 - 82:30 affordability. So, so um I think that's really important that we we make sure that that we are putting together as close to uh the bone as we possibly can uh in terms of a tax rate that we're charging and the tax rate increase that we may be passing along. But at the same time, we're also delivering the kinds of services that we need to have in our community because because people do expect excellent services and so they
82:30 - 83:00 should in in Richmond Hill. So, we need to continue to do that. Um, and and you know, we've also it's interesting in one of the slides and with the strategic plan uh comment that was made in the third uh part of the mayoral direction. Um all of the plans that we have in place are built around a very significant amount of public consultation. So these are the road maps of the things that people have told us when we've talked to them in depth about
83:00 - 83:30 the strategic plan, about the parks plan, about the environment plan, about the the you know any of the plans that we have that guide this process, what's important to them. So this budget needs to reflect all of that as well. um you know and again given the challenges that we have with tariffs with uh frankly a lot of uh underfunding that we're advocating to make better with other levels of government and so on and so on and so on. So that's why I would prefer
83:30 - 84:00 to have had this motion the way it was was um presented um and let staff go out and do the things that they're doing. Uh come back with us and we're hearing from from residents on on a daily basis about the things that they need and then we come back and we're going to work as hard as we possibly can to get this as low as we possibly can. So that would be my uh recommendation. Um given what we have before us, I'm not sure how we do that, but um but regardless of whether
84:00 - 84:30 you know whatever happens, that is what I am planning on seeing us do throughout this process. So thank you very much. Oh, and just finally, I I just want to say thank you to uh Regional Local Counselor Depalo for his role in in helping to shepherd this process through. you've done a a good job, counselor, in the last number of years, and I I really do appreciate that being brought to the table, too, because I know uh that you're always keeping an eye to make sure that the budget uh increases are as low as possible. Thank you.
84:30 - 85:00 Thank you. Okay. Uh Councelor Davidson, you're next. Thank you. Can I speak about the presentation or just about the amendment proposal? The amendment only. No, it's not. It's not an amendment. So, a motion on the floor and motion and absolutely absolutely you can ask questions too. Oh, okay. Um, thank you, Mr. Chair. I I do want to say I think it is premature to put a number in any of these documents because even if we make it or don't make it, it sets up an
85:00 - 85:30 expectation that we're not in a position to to guess. And whatever we did in June of 2024, the whole world is different. And I mean, just look at the fluctuations and nobody knows what's really going to happen. So, I personally think we I agree with the mayor. We should let staff go out, come back, tell us what we need. And that 3% number is also confusing to residents because it's never just what we want. It's also the region and education and it ends up being it sets up false expectations in
85:30 - 86:00 my opinion. So, I I I would like to keep it without that number on there. Um, my only other really well I have two comments. One is through you, Mr. Chair. Um, I think the online consultation's a great idea. I did pop in on the in-person ones. They're not well attended. And um I think I don't think it's a big secret that if any resident had a question, they can ask finance folks directly through email or through access. Any specific questions a resident has can be can be addressed. Is
86:00 - 86:30 that correct? Through the chair to councelor Davidson. And I would add that it's at any time, not just during the budget process. Right. So, anyone who has a question about finance, budgets, tax rates, please reach out to the city and have your questions answered personally and directly. My last one is always this graph that I can never understand tax supported funding, the bar graph. And so, is the red thin line what we're going to bring in through property
86:30 - 87:00 taxes? What's the red line? I don't have a number on this slide. Do you know the one? I mean the bar. Yeah. So I never understand like the way I Yes. This one. So what exactly is the red line? So the red line is the 1.5% contribution. So as you saw on the earlier slide, aside from the tax rate increase, we also have a dedicated fee which is called the CAS levy. That's 1.5%
87:00 - 87:30 um on an annual basis. So the red line identifies the increase year after year. So we're gradually increasing the contribution to the reserve funds and we're also when you look at the bars those are the expenditures. So that's the capital that we're funding. So what this graph really tells you is we need to continue with the
87:30 - 88:00 1.5%. As well as managing our capital plan so that we can prolong the life of the reserve which is the peach. So you see it doesn't go below zero because we're stretching it to make sure that we're able to fund the program. We're adding contribution. Now you can see that it's declining but within the next 10 years we're not depleting the reserve and forgive my lack of math skills through you Mr. Chair. Um, so the difference between the red line, for
88:00 - 88:30 example, in 2025, the dot in the middle of the bar graph of 34 million, what's making up that difference between the dot and is that the reserve fund? That's the pair. That's correct. Right. So, anything above the red line, we're going to make up that shortfall with the reserve fund, which is why the reserve fund is going down. That's correct. And we can't really operate properly without using the reserve fund. and using all the things we have here. Okay, I I
88:30 - 89:00 finally understand it, but I bet you it's momentary. Okay, thank you very much. Thank you, councelor. Okay, so um Councelor Thompson, go ahead. Uh thank you very much. And actually, Councelor Davidson is actually uh coined exactly how I felt about, you know, setting a target as well. Um but you know perhaps it would be best if I just find out uh you know a question to councelor Chan is
89:00 - 89:30 where did you come up or how did you come up with that 3% target? Was that based on some form of research or a gut feeling or you know like I I'm just curious what why we would want to do that because to me I agree with the mayor this is going to handcuff our staff to try and work within a certain parameter when really they should just be working towards what makes the most sense for the city.
89:30 - 90:00 Thank you very much for the question. Good question. uh when you um you know um I stress tack it and I did say you can pray to tape again in no way tying our hands and I did even say maybe it's a 2.5 even better so uh I I'm to be honest I'm I'm quite surprised that something that we have adopted and passed less than two years ago now seems to be as as
90:00 - 90:30 something raising all this question they're tying our hands certainly not quite the opposite. I think that setting a target uh if you want to put a a particular percentage and 3% is the one that we did pass two years ago and if you look at even last year certain municipality in York region correct me I'm wrong it does come in at three of course you cannot compose apples and oranges uh but if you're asking where it come from it's not uh a number that
90:30 - 91:00 actually has been just picked in the air uh first as I mentioned model on two years ago go. Secondly, there have been municipalities in York region that come around that in their actual um uh tax rate uh in terms of increase over last year. I hope to answer the question. Uh thank you uh through the chair. Uh I I'll just leave it at that. I would much prefer that we leave that out and let the staff do their job. Thank you.
91:00 - 91:30 Okay. Thank you, Councelor Selibus. Thank you, uh, Mr. Chair. In the same vein, I have a question, um, perhaps through you to our clerk. With with seven small seven added there, does that mean if we're going to um vote on these recommendations? We're also voting on the small seven because we didn't have a vote on the bench to include it in the motion. Sorry, I'm just confused through
91:30 - 92:00 you, Mr. the the motion is put up put on the floor with that clause. We could separate it out if we Okay. I asked that it be separated out. Thank you. When we vote. Yeah. Yeah. Okay. Thank you. I don't see other speakers. And that's what I was I was going to ask for. I'm glad that it'd be separated out. I I'm I'm not going to support that target. I'm not going to support that number. Um it's not an up it. um maybe maybe as a cap or you know
92:00 - 92:30 a maximum uh but not a target. I think we should be targeting no increase. I think we should be um doing the best we can to to get you there but we don't know and there's so many variables, so many uncertainties. We haven't talked any numbers yet. We're we're we're starting off a process here. It'd be like starting a public meeting and saying, "Well, we we we as a council want this building to be 18 stories and that's our target, but uh let's hear from the public cuz that that's the most important thing. Uh for me, it's about
92:30 - 93:00 the public. We haven't got to them yet. We don't know what they want this year or what their concerns are, where they lie. And um you know until that happens I I don't I don't want to to to restrict us to a number or or or set any um targets. I I I think it'd be premature to do so. So I I don't support that one particular item, but I do support the rest of the recommendations. And and I I do at this time um think it's important to to acknowledge um the the mayor's
93:00 - 93:30 option here uh to to continue to work through this budget committee. the whole um the Ontario uh government is allowed mayors to come he uh mayors could could drop a budget on their their council and whether whether they like it or not that's that's the budget there there's there's no requirement to have um this tradition that we have in Richmond Hill of a of a budget committee the whole and
93:30 - 94:00 I want to thank the mayor once again for uh including all of council and and um valuing the process that we go through uh year after year. Um as as as a council as as all of council with opportunities for input and u opportunities for discussion and and of course opportunities to include um the public with everything that we do and to hear from them. So I'm looking forward to that. I I think a lot of it's a lot
94:00 - 94:30 of it's already been said, but we've um we've we've made some hard decisions over the past three years that have got us to to uh this position that we're in today. Um the contributions to the mill rate stabilization, but also we we paid we paid back uh an over uh estimation when it came to investment income. Here here we are again with a a a good return on our
94:30 - 95:00 investment income, but in the in the in the past we we were budgeting for um to to be receiving a lot more and we and we stopped that. We phased that out. I I don't I don't know if everyone recalls, but uh that's that's something that has been done over the past 5 years. Um we we've we've tripled the mill rate stabilization, the strength of that reserve. we it's it's a better picture when it comes to capital asset sustainability uh because of those decisions that that we've made. Um we
95:00 - 95:30 were at a point I believe at the beginning of this term where our um reserves would were going to be depleted within 3 years or 3 to 5 years and and now we've got you know a 10-year runway to to to address that serious situation. But there's a lot of uncertainties out there um internationally and with with this province and there's a lot of indications that they're going to they're going to handcuff us with with
95:30 - 96:00 further development charge decreases. Um, and we're we're we've got that penalty looming over us of of hitting of hitting targets that um, in my mind just aren't fair that Richmond Hill um, have foundations for for 27,000 units in in the next four or five years. Foundations poured. Um, so we we in all given all those
96:00 - 96:30 considerations, I I'm glad to kick off once again this this budget process and uh to to support the the staff recommendation. Uh the movers asked for another opportunity. Okay, go ahead. Thank you very much, Mr. chair and I do appreciate my colle's feedback but to be completely honest I never have anticipate the reaction it was because to me I thought that was this identical wording we all likeminded back to only less than 24 months ago uh
96:30 - 97:00 but I've been reminded things change and so on so on I got it uh and again I I said it before and I want to thank uh Mayor West for also and the chair of the budget committee also echo for including all of us to really have uh really uh good discussion. At the end of the day, of course, it's the public. We are all taxpayers and we have a say on it. Uh but in my own humble view, I honest thought that we took leadership
97:00 - 97:30 and just set a target with it below great but no in no way tying our hands. But in the spirit of unity, uh I also want to see the motion to be passed unanimously. I hope so. I am respectfully withdrawing that uh C7 uh with the way is the same as um recommended by staff. So that's my final recom motion. It's on the floor. It's an amendment.
97:30 - 98:00 Yeah, Mr. Clair. Thank you through the chair. According to the procedure bylaw, if a motion has not been voted on, the mover can withdraw his motion and then sounds like you would like to bring back a new one. Thank you, Chair. Exc. That's a blast from the past. Um the uh so but the motion would have to be withdrawn completely because the motion was put together as a full
98:00 - 98:30 motion. Is that correct? Thank you, Mr. Chair. If I may, I I'll read. So section 5.6.2 withdraw of a motion after a motion has been moved and seconded is in the possession of council for consideration but may be withdrawn by the mover at any time before it has been voted on. Okay. So it has to be the entire motion has to be removed. Okay. So I'll move the original motion then. Okay. So, we have the the motion on the floor
98:30 - 99:00 has been removed by the mover and Mayor West, you want you want to the staff recommendations? Sure. I'll move the staff I'll move the staff recommendation as it's written in the staff report. Uh, any discussion? Seeing none, all in favor? Any opposed? That carries unanimously again. Thank you, Ken. We move on to 5.4.
99:00 - 99:30 Sorry. No, we don't. We uh with that concludes our scheduled business and council tree wants to move an adjournment. Okay. All in favor? Any opposed? That carries.