HomeMy WebLinkAboutADMIN-41-97 se -
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F R
s
REPORT
Meeting:
Date:
Report #:
Subject:
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
File # ~a ~ ~cT
GENERAL PURPOSE AND ADMINISTRATION COMMITTEE Res. # GPA - Shy-9 ~
October 6, 1997
File #:
By-Law #
ADMIN-41-97
GTSR/GTA n~}innc fnr the Municipality of Clarinaten
Recommendations:
It is respectfully recommended that the General Purpose and Administration Committee
recommend to Council the following:
RECOMMENDATIONS:
1. THAT Report ADMIN-41-97 be received for information and discussion, and
2. THAT the Honourable AI Leach, M.P.P. the Minister of Municipal Affairs and
Housing be requested to reply forthwith to the Municipality of Clarington's request
for a twelve months grace period from the time the legislation is passed to opt out
of the GTA and the Greater Toronto Services Board (GTSB), and
3. THAT the Mayor join with the other Rural Mayors of the Region of Durham in
requesting an immediate meeting with the Minister, and
4. THAT if the Province of Ontario DOES NOT allow the fringe Municipalities in the
Municipalities of the GTA any time to decide on their membership in the
GTA/GTSB, based on the figures in this report, Council must seriously consider
requesting to leave the GTA immediately, and
5. THAT the Region of Durham, the County of Northumberland, Mr. John O'Toole
M.P.P., the Townships of Scugog, Uxbridge and Brock, the Peterborough County
Board of Education and the Northumberland Clarington Board of Education and
the Peterborough Victoria Northumberland Clarington R.C.S.S.B. be provided a
copy of this report. ,,,, ~ 2 (j
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Aana ud-X41-97 Face a
i3AlGKGR4iJND:
1A The Cost of l.oaving the Region of Due'ham, taTA smd the i~TSB
1.1 An July 7 Council considered report ADMIN~6-97 and theretay endorsed its.
.previous resolution to explore the costs associated with the Municipatit)r of
Glacington .leaving the GTA.. If the decision is to leave. the GTA :the Municipe~ly
is forced to leave the Region of Durham and -have .the servioes they provide
deNvered by Clarington directly, by contracting out services, or taysether laurels of
government.
1.2 The report Admin-36-97 requested that the fringe AAur-icipaliEi~of. GTA be
given the .benefit of twelve months grans from the time, the I~islat~ is passed
to opt out of the GTA and the Greater Toronto Services Board (GTSB).
1.3 In order to completely assess the financial impact of the Municfp~i#y lung the.
Region of Durham, extensive financial analysis would be required. The analysis
would be required to assess the :impact of development charges cx~rrently
collected by the Region, lost economies of scale, debt and borrowing,
implicat~ns, administrative cost aNoc~tlon, as well as many other unanticipated
or hidden casts. This exercise can not,be completed in the tune:#reme allowed,
and depending on the Provincial decision, it may not be neaassary. The cast..
references in this report are therefore very preliminary and are prepared on an`
"overall" perspective for informatign purposes only.. ft is recommended that
further detailed studies be undertaken. only if the Provincial decisicue is to allow >•
separation from the GTA.
2.p Region of Durham Report on the Estimated lmpa~ of `WHt3'ipt3~S WHAT"
2.1 The report prepared by the Region of Durham #97-F-60 Estimated Impacts On
The Region From The August 6,1997 "Who Does vuhat" Provincial Announcement:
is attached for reference (Attachment #1). The Region report cly anticipates-
a "best case scenario" of a net annual impact of $35:3 million (vr.$17:9 million
without considering the Municipal Support Grant eliminations for' all area
municipalities) from the Provincial downloading. This calculation is an; estimat®
based qn the announcedtransfer ofifunctions to municipalities-and is net of the;
education tax room (value on the tax bill created by removing the eduction tax)
ident~ed by the Province in the August 6 announcements. It has adjusted for the
Region wide value for the loss of Provincial grants and subsidies.
2.2 The Region: report suggests that the 1998 and: future tic bills w#N be
approximately 7596 related to Mega City, GO Transit and GT$~B eos#s. tt is not
possible to determine the value that -will be apportioned fa fire Municipatity of
Clarington until the Region has all the final data and legislatl~re regulations
and guidelines, however 'rf it were to be based on the qurrent 1196
.apportionment applied tq the $17.9 million. to 21.1 million ttts ~ w
be .approximately $1.9 million. to 2.3-million,a~~ tax dtellars ftN
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A~,l' i~iPi-41-97 Faq~ ;
Regional purposes, on the residents of Clarington. ff this $t.9 n is added...
to the $i f .4 milliarr currently paid to the Region through the tax lery4 t*re
impact is a total of $13.5 million (an'Ir~®ase of t~ to 216 fir- Regh~n
portion of .the tax bill). If this is added to the $12 Municipal.9upporf Grant
which is proposed to be eliminated in 1998, the total Impact for that year alone.'
will be at :least $3.1 million in total. This combinatioa of !os# rerrenue an:!
incr®ased c~# wiil cause a ta~c ineuaase equhraiert# #o a~a#ely 15°6
unless drastic, cuts #o services ars Imposed to achieve ~ihue
reductions. Thee average tax bill in Clarington is $2,292 which is made up of
$1,444 Education, $444- Region and $444 for Muniapat tax. A 1S% increase
would make this tax bill approximately $2,442 or approximately $t5p more withou#
considering any;increase on-the education portion of the tax tailt..~iir, caution
should be exercised in reference to these numbers as there:. have been
confirmation of any numbers by the Province.
2.3 The confusion: is further compounded by uncertainty whethe( the Provincial
education relief referred to in the Region's calculations has adjusted for Clarington
being. part of the Northumberland Board of Education. The issue d education tape
support isplored frnther in the followa~g section of this report.
2.4 Report TR-76.-97 should be read in association with this report. ReportTR-78.97
deals with the resolution received at the Council meeting of .}ufy 7, 1997 by
resolution #G-524-97. It references the City of Tororrto's:recommerrdation'to have
social assistance and housing costs. in Toronto shared in the GTA through the
GTSB. ft is questionable whether the full impact of these costs were,ine~uded in
the Provincial numbers and therefore-'these- costs may in irrrpa~
identified in the .don's analysis.
2.5 Much of the, dtlficulty-in preparing any analysis of the'impact is the uncertainty of
the numbers. The Provincial announcements contain a cau#iorr or a disclaimer
that. the numbers should not be used for analysis because fire ultlmate nfethod
of alloca#ion may vary. There are no-details of the methodologies used or what
is included or excluded in the numbers. and therefore it is i to assess
or understand. the true impact. The; Region,. in its report, rues the same
difficulty.
3.fi Education Tax Support/Assessmerri Reform
3.1 The Municipality of Clarington is in a unique situatiomwithin fire Region of Durham
in that the education tax support is to the Peterborough County Board of
Education and the> Northumberland Clarington Board of Edu+tioti and tte±
Reterborough i/ictaria Northumberland Clarington Roman Cadholis ;Separate
School Board, whilethe upper tier. tax support is to the-Region of Durham. Ail
other area RAunicipalities support the Durham School F3oards. this rtrajr tie one
additional reason that affiliation with the Northumberland. County is a reasonable.
request for Glarington.
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3.3 The Provins~ was examining two proposeis with respect
education; one method was a unikum mill ratewhich wou
wide, and the second: was a value which:represents Si}o
existing cost of education. The second vpson appears to k
status quo to the extent that the lace! board costs
pnsiiminary a~,~rsis by the Atlinistry of Municipal Affe3rs
there would be increased costs under a Proving wkle
versrcm of the status quo remains, staff fed that the
of education costs across the GTA. It is estirr~ed that an
resut# in increased .costs .:for the :Municipality of
significant -loss to the t4orthumberts~d education tax
pooled Nato the GTA base. As stated above, R is unclear: a
Provincial numbers :issued to the f~gion for edugtkm`ts
for dr~rvnloadi-tg, have adjusted for Garington being p~pct
Rrs ri# Eclucatio~l_ me Provir~ vrss oorrt~ted enci si!
~4t-97
3.2 Th® Praxinc~e has not dealt with E4luoatkx~ rebrm
it is n~rt poible to determine the relief on 1
to date are-:only ester by the Province.
municipalises wiN be able to t~t+late the it
downloaded ssr+~Ces`in plaae M tt~ ~iuc~tion p
consrm
COn~rm
'eiea88q On AUgU
the edUCatlOn t87t
# a `*-`
4
st,ar~.:t auGh tNne
is. '1'he'~fs it
3.4 Another poten#~1 impact to the property tax bilF may come frcrcratks3 ent
reform implications under Bill 146. n is possible ihffi ~-Mun c-f G~arngku-
will share in tl~s impact of reduced;assessna~'a for lard oo-erc~al ;,
erprises suoh ~ {3M. ~ this is the ccar-clusion, ~ melyr
ratepayers of Gtaringtan to be out of the Region of D~1, 'Fhef lli '
of these changes will not be known wn#I the. ass l~Ve been
procssssed in;early 1998.
4A Opt#oras (Pros snd Gans)
4.1' tf the Province decides that the fringe Municipality are.not to.be~,~ren
participation in ttte GTA and the GT$B; ~e Municipaisy of w~ l'~ve no
choice in the matter.`
4.~ The Munlclpa#ty of Clarrng#on is an:record as recominerxi~ tfee , :quo w~ ;
some ca-ordin~ion of senses across.. the GTA. Fir, if ors Rravince
le~sia#es the GTSB and albws the Munkx:i~pality to c-pf oat of the: ~'A, the
following are the options that-.Staff feel the Mu ' ' of Cris fang:
,.
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4~' ~x° -x~ Sa C4c+
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B) Council could consider. Becoming pawn of the Coa~ty of
Norflwmberfand and explore the possibiNty.of s~l#cm. andl+~`,
cost service sharing: with nely~hbouring mun ~ this option.
would. serve to satisfy the Provincial directive and ~ the same time would
aliow'the Municipality to pay for the upper tier services.throh the County
levy. This option has been discxssed on a preliminary basis ongr, whit the
CAO of Northurnberland County, who was receptive to t~ttfier ~ve~#iga#ion
w#hout any .firm commitment until the matter .:was d" with the .
County Council Members.
B.1) H Gouncii makes the decision to leave the GTA statf are sugges#ing
that the Municipality: should request up to the three year: term at the next
Council fn order to sort out the funding and other detsils:t® fuNy provide ,
the services currently provided by-:the Region of=Durham.
B.2} Ifi .the direction from Council was to beomme part of tine
Northumberland County they may wish to investigate w~ poNCe
services could be provided by the County level for aN rnun~lpa~ties
within ite jurisdiction. if the' County of Northumberland were to consider
providing Polir~ services on a county wide basis, it would elinrina#e the
currentsituaEion of independengy funded Police services #or P+art mope and
Cobourg. This move would also be in keeping ve#ttt~e Provir-dai ~eetive.
B.3) If out cf the GTA Council might explore the-action with one
of the neighbouring'municipatities ~d/or cost sharing anti ~.&ervfces
over the next few years. This option may benefit l~tunfcipali~s ~voNed in
the following manner:
• Reducing overall exposure to increased costs levied through the
GTSSSo municipalities who have virtually no represereation trn the
P 5
A) Separated City : the would be a similes siturs to the; City of
Peterborough which essentially provides all the.. services Oven
the direction of the Province to reduce the number of murk arKl
reduca dupfic~tfon, thFa ~. not considered to be optima that would be ;
well received by the Province.
board..
• The. history grad issues facing neighbouring rural mun is
similar.
• The urban/rural mix of most neighbouring ~clltfes is sim~ar `
which may allow more efficient combined service deNvery on such
areas as roads.
• A combined tax base may allow for an averafi lo~vertex let~t (this is
an estimate and will not be able to be aterified- of. actuaf
value: assessment and wi3W responsibiifiy shifts)
~ Given' the lean Staff corrrplement within the Munk~pelity of
Clarfngton, it may be .reasonable to absorb exfstpg t3taff of any
municipality that. is willing to consider thisoptian, without,any !Wb ,
losses, except.through normal: attrition.
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-91-97 Ems,
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SA) , Potential negative impacts of an arnaigarnation, aW loWults the
following:
• There may be issues such as water and'SIMAW,e+ 81
roads capital',repairs , that imps#WUW**a .c(V 7 j
( this requires more array to be verified)
• The loss of some of the Region beneffis ~ will no der be
available such as their AAA bond rating, sooforAft of soalej and
uniform water and sewer rates, may be a
5,O Region of Durbarwo',Satiric es CurrentlyProiddoct
5.1 The Regkxv of Durham 1907 budg*,net levy is $403,483AWi,,,,Th1s levyr is
apportioned to the eight area municipalities, and t on` :. 11% at,
$11,457,712. The specific apportionment for each of tfre Munici . is
identified on the following table:
t 4 x
IS
Oshawa 28.00 20,803,327
Fu4cedng 20.30 21,060„254'
Whhby 18.34 18,818,441
Alm 13.31 16,774,711
11lfT 11,A50.782-
SCU909 ' 3.97 4,108,338
tlxb[idge 3.82 3947,902
Brock 2.30 2,373,0e
TOTAL UWY 100.00 103,A83
5,2 The cost of°WaWand Sew operabats,and capital( 6851 is r in KWW
in the levy. These costs are ftamed by a c o n
Development Charges, debentures and contributions from York.'
5.3 The $11 million annual apportionment provides serves to the Municipafity of
Clarington in the following proportions, (based on 11% ofeauh,departmental
budget)
1206
_ 41-97
POGO 6�l,sse aoa
H"th &s0ow SWAM 27,42ZWO g,Qe6;74$
Roach-CapM&Op®►ation 18 t 200 1849,716
I kanpe. 00,409-
( r cwAu) 443kM 4MW
a;tes,tse
I�iq•Dep &Reg.A1r. 4,x,893 17ff,4Si8 i ,. ,
e
SUB TOTAL 115,143,M 1,2 '51,045
$G#d WNW 1,700,000
l Pragram Rrux�g (13.849,35 } 11.<79,
T 11i4�. t
Add back Anpndrig:-w1H riot bs wadable
TOTAL For$ERVIC9S In REG NJAL LEVY ;
5.4 The above allocation is based on the 11% apportionment vaIue:rd ed O the
totaVbudget-far that function. in most Cases this +ill not tre i r:� Cost to
replace this service, for example, ft cost of Health arts So", . i + 27
million allocated on an 11% share results in Clarfnri $
whereas If the cast were based on a caseload allocatiorr#0
MS Clarington caseload was 8.5% of the total; 806 of the try bf
million is $2.8 Minton). This is based on the
assurrlp -that
attributed per case. The opposite may be true for CWW loofte, wfi#1`
water and sower capital, where it is"rn*ed OvIAGWOngW elf
Regional cost sharing.
1.0 Cosh Ilor M 'Ser vicow-ft be Pied°bye ,
8.1 In order to assess the prellminivy capital and maintenance .ooW that the
Municipality might face on {saving the Region of .Durham ",auder s+ervloe'
categories were defined as follows:
a. Roads
b. Water aruf Sewer
C. Police
d. Ffeoffh *W Social Services
e, SON ate
1201
14ete: a. &b. The fits ofTotten'9AffMbidd VAVasked to W410 ?s art 0 , NW*Ad
Sevres' e'and related costs and MM Put WWkwin cfc *"Wnw*, ,
psis to sWwn as Aaachmerst#2. (snider WPW08 cover)
c.d,e: The c psis associated whh Polloo, Health and Socha Mona and Sctpdr nfaow are
based on'iMormallon prwAded In Start from the on of Dow". "k#iW c c t8
and allooatlon fornvAes are furdwupiored below.
`s 6.2 The optionsior service delivery of major categories amPwwftd by tel:
table. . caution should be 'exercised in interpreting the numbers, as they are
estimations only and urd detailed kf4)W"studies sirecondUcled they am.not-
verifiable. Untit the Province confirms Its intention to allow ttwmunklpi t t tow,
out of the :QTA, it would not be recommended to v end AugW and" tirra to
determine costs that may not be reabed
IM
rt s <a £
poke a.W,327 .5,511,346• BwW an OPP ccwts IntfrlMt�Pisf2laer(tarn !•
for
or NorMureftelond AtM pst EM'P to tp lte an pravldfNgM ,.,.
or Mgien odst lablp
7211,000 . Per'DI~f>
Park a odk4do of ACKM Laft Y May "
•Used In - OMMIae folmirds"hon MWt"rib~fa#M4de. :::
tolml Coe*
Heam& a03e.746 2,330,895 1995etwomkigwn is- ""rIJ%A*WWpa 6o@tu1
Steel 6,6%cttaseload s"M;
s«wae
:Roads 1,848,716 1176.565 T.s.H:st for Take aver asRegt ifRaeds:in
+ OPeratlmfsr Olat +.irega4i( 3em•Chaz4a
1.000,000 CepIW per T.a,H. Rnure$#am Roo",
est.0angt IM W 1.3
Min)
'Wade 1,3201000"- 1,320000 Cost per.twmtoUpby NatlnxnbwWldw M*provicko
Region;not expected to bdh eoAroiomnW°tlsAeh : ,
0 634torm $0310me choW.No meW Unpact OWWdk i WOW to,00tWwkTMWw
expsarad: BMpon pwpasWar*M do.
VVAW 0 0 Per T.&K.OparaBons rtMV310 sl~Nk"nets for
Isewer net of re6eredea W4*w%0W8sa for%W*Sewer,
boprsysr cpfa ntOlmgaswotAd
Oap#&W 131,000'• 1,tooAoo Cap"-tax lsvypaUQn be,awfto Wbe adhOod.,
cap*" 136,000*• 1 "AW WOW%
Toros 12,917,789 14,340.905 Estimated cost for major services
NBT COST 1, MIG "1111110" Cost for Clarkow
I ESS {1,3t161,f1130) Savings-if Adrnin. Services rA PAQUireaVROW49 etc)
(1,479.522) Non ProWam Financing Idd bs*to
SANfNQS MAW TOTAL PRELIMINARY SAYWHIS ISTMiAM
**EWneW based of tax bvy se*natad by TOW Slurs HUbid #VpWdWW OW RAP"WIW A aNW USW&,
t
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not been added to,either the cost or the savings projected any mt~re thanthey wfil
as part: of the Region levy. n is difficult to assign -costs and' tt- assess the
potential increased internal impact to Clarington for increased workktad if some.
of.these #unctions were to be taken back at the lower tier, therefore any-impact
will be absorbed or addressed through the annual budget proca. Rlthewgh the
savings may be more or less than the `ball park" estimate al~te, it is anticipated.
that the increased requirements for staff and additional av~head costs to
Clarington as a result of taking on the additional. responsibfilties vsrifl not outweigh
the savings-that are to be achieved..
6.4 Water and -Sewer costs .are estimaRed by Totten Sims Hubicki: based 'ten the
Regional documents provided and discussions with the Regiot staff. The
'd d t 'I the cost analysis The true atiorts
N•r ? , a,.- - .s
* 6.3 Administrative type functions which are currently part of the Region budget such-
as, planning, finance & administration, agencies, and other riactmentat
functions have not been built into .the cost impact abaroe. The N1~at~ipsdiEy ~
Clarington is apportioned appro~cirrtately $1.8 million #or'theea fuotna~rough
the general levy. Some of the :costs, such-as those assoa~ed w n
authorities and other agencies, are not expected to increase have~re#csre
attachment prowl es more a ai s on oper
impact is difficult to assess because the Region revenues are based on a fiat rate
user fee across the Region. The. user fee may go up if the ~n is cor~iained
wfihin Cla~rington based on the general. principle that the. ~peraticn of the ~afitt
will be finar~ed by a smaller number-of ratepayers.:.
i
6.5 If Clarington were to leave the GTA, the capital InfrastructurerCests for f~u~e water;
and sewer facilities are expected to be significant since these " also can be
spread. over a large number of ratepayers when they-are financed through the.
Region. of Durham.. The capital for. water and sewer has been based
on the Clarington related capital expenditures as determined by 'Pollen Sims'
Hubicki calculated over the total .water" connections in the Regkx~ and then:
applied to Ctarington users. The calculations show a significant savings to "
Clarington from the economies of scale .provided by the tot81 t~gfanal treat base.
However, the significance of the capital decisions resting with Couno~-raker than
with he GTSB in terms of when a facilely will be built, can not. be overhked. If
the GTSB is to decide on whether a fadiity is built in Clarington oe in Toronto, with
no voice on the board, the decision will not likely ;favour Mwticipallly.
Development Charges would continue. to be collected at the kteal levy for fhe `
proposed future capital projects.
6.8 The Regional Officiat Plan would no longer be applicablerf Clarington leaves the
Region of Durham. The Director of Planning has advised. that the approval
process and direction on Official Plan matters would tae dealt with direc~y by the
Province. This process would eliminate some costs associated with the Regional.
Planning .function but it .will not necessarily alleviate the --time conatrair~ts
associated with the approval and response time for .planning iseues::
6.7 The impact of soHcf waste services br Clarington outside of .ttie tt7A, is not
anticipated o have a severe impact _on Clarington ~'ll+ in light: of the ,
continued investigation with Canadian Waste Inc. regarding the purchase of a site.
..for a waste transfer station within the_Municipality. R is antics theta report
on this issue will be forthcoming in the near future which wiN make final
recommendations and update the pr~-iously ~pp~pved d
„~. r
. "~ -+l 41 97 Race t C3
The Region of [3urham has no long range plan in p at precept tts deal with
waste. In addition it is antiapated that within the next five to ten yes ills existing
reserve fund, which heavily subsidizes waste and retyot~g; wfi
resulting in a significant increase in the tipping fees. Gts'-~ k tt~t
it may be in the Municipality's best ir~tei'est to consider' indepEendenc~ frbm the .'
Region on waste issues. The recycling cx>mponent of the waste ~+ ttas not
been fully..explored and alternate arrangements wHl be expkrred should the
approval be given to leave 4he Region of .Durham.
7.tt Conclusion
7.1 It is,Gear that the status quo would be the preferred option for the Mity of .
Claringfon because many of the services provided by the Region: are on a more
efficien# basis particularly those associated with: large capital ~oy for
c construction pro}ects and facilities. Atihe same time there are a~umtsa~c tt# costs ,
such as azlministraticn -etc that are overpaid for by ar~~:muniapa~es and
theta is soma duplication of functions between the two levels of,~overnment.
7.2 The analysis,is not conclusive because many of the cx-stgare d+ffiCUit~9M~tportivn '
or aesess, howeverrf the best case scenario is a "break men" or even a~ irx~'ease
in the cost to provide major service; the cost wits be much less than that which
will 'be do+nmloaded through the GTSB to the Region of t~uufianww .and levied
through the'Regonal levy #o -the resider>ts of Claringtan.
7.3 ff Council decides that the best option ~r servicedelivery is fur Clarington to
became part ofi the County of Nor#humbarland, as the largest urban centre it wiH,
have a signiflcar-t voice in future dec>,aions and it will oantinue to be, ~cauntable
and accessible to the citizens of the Municipality of Glarington., ~ the studies
conclude that it is not in the best interests of the Municipality tts part of
the County structure, further negotiations wfth the Prownee cam t~ce place at that '
time. 1f Council decides to leave the GTA, and therefore the of Durham;.
and-not to berx5me part of the Northumberland Cour-ty further nago with
the Province can take place at that time..-
. 7.4 The G.T.A. and- GTSB would not benefit financiaNy: -from the Muniity of
Clarington remaining within its boundaries because of t#+e inoreask-g servioe
demands, rapid growth, water and sewer expansion reiaukements, and ite'largely
rural road netrivork. Ctarington has virtually no won issues w~- #~ large
urban developments to the west and they would fmd it dif#icuR W effectively
,address the'rural community problems and complexities.
7.5 ff the Province decides not. to allow the Municipality or+e year o decide on its
membership in the GTSB,: It would therefore seem that it may :t?e ~e best
interest of ail concerned to allow the Municipality of Clarington t6 ~ the GTA - '
.and the Region of'Rurharn immediately. This is the de~ion that Council wifi ,
have to cx~r-sider once the Provina9 has responded to the rec~aest put fonaard by
the Municipality of Clarington.
i~~Q _.
ANIN 41 97 Pam 11
Respectively Submitted, Reviewed by, ?
. Marano, W.H. Stocky ,
Treasurer Chief-Administrative Officer
P: Baal e
S. Vokes, Director of Public Works
WHSfMAM/pP
1211
~'e1-(Ir"_y~V~~ i~ I
r '~n''U{IIIVVVU~~ sFP , o ~s97 `J
MUki~L-~._:: ~ „i :_A3iNG i:-.
The Regional Municipality Of Durham
ADDENDUM TO THE TWELFTH
ATTACHMENT #1
SECTION 4
REPORT OF THE FINANCE & ADMINISTRATION COMMITTEE
To The Council Of The Region of Durham
September 10, 1997
Members of Council:
The Finance & Administration Committee presents an ADDENDUM to the TWELFTH
Report and respectfully reccmmerds as follcws:
6. REPORT #97-F-60 (REVISED} OF THE COhdM!SSIONER OF FINANCE
REGARDING THE ESTIMATED IMPACTS ON THE REGION FROM THE
See AUGUST 6. 1997 "WHO DOES WHAT' PROVINCIAL ANNOUNCEMENT
Attached
Pages RECOMMENDATIONS TO COUNCIL
53.1 - 66
WHEREAS on August 6, 1997, the Minister of Municipal Affairs and
Housing released an impact analysis which provided the estimated
changes in municipal costs and revenues ihatwill result from the Who
Does What package but also cautioned chat the numbers 'should not be
used to estimate over-all impacts on municipalities'; and
WHEREAS on August 21, 1997, Bill 152 the Services Improvement Act, to
provide new municipal funding responsibilities related to the Who Does
What package, received first reading by the Provincial Legislature; and
WHEREAS the Regional Council of Durham strongly objects to the lack of
accountability for Regional taxpayers created by the downloading of the
funding responsibility for certain services and .the pooling of service costs
across the GTA municipalities without any 'say' in the management,
delivery or scope of these services; and
403
1Zi2
-2-
r
WHEREAS the Regional Council of Durham has serious concerns
regarding the uncertainty of Provincial estimates; the lack of Provincial
direction regarding services to be downloaded; and, the lack of
information regarding the Provincial transitional funding for interim
property tax relief with a proposed implementation date of January 1,
1998; and
WHEREAS the Region of Durham has already adapted to successive
significant reductions in Provincial funding transfers over recent years
and the Province has promised that actions taken at Queen's Park would
riot have an adverse impact on property taxpayers; and
WHEREAS the Province of Ontario expressed its commitment to ensure a
fair and equitable property tax system across Ontario, and given the
acknowledged difficulties with residential undertaxation in Metro Toronto,
the Region of Durham strongly objects to cost sharing with residential
taxpayers of Metro Toronto; and
BE IT RESOLVED THAT the Province defer its plans to download costs to
the municipal sector until the Ontario Fair Assessment system is fully
implemented and its impacts known to all municipalities.
AND BE IT FURTHER RESOLVED THAT if the Province proceeds vrith
the download of costs to the municipal sector that:
i) the Province honour its commitment of no increases in property
taxes.by providing sufficient funding to offset any additional casts
to each individual municipality;
ii} the distribution of GO Transit costs across the GTA municipalities
be based on an equitable balanced formula that takes into account
service levels, system wide benefits and costs, capital expansion
and benefits to Metro Toronto businesses;
iii) any pooled downloaded costs only include the costs related to a
mutually agreed level of service in order to exclude the cost
differential associated with Metro Toronto's higher level of service;
and
iv) the Province immediately release all relevant information to
municipalities and prc~aerty taxpayers to validate the Provincial
assertion that the transfer of services will ease the burden on
property taxes.
404
1~i3
~ -3-
AND BE IT FURTHER RESOLVED THAT the Regional Chair express
these concerns to the Premier of Ontario directly by letter with a copy of
that letter and Report #97-F-60 (Revised) on the Commissioner of
Finance be forwarded to the Minister of Fnance, the Minister of Municipal
Affairs and Housing; the Minister of Community and Social Services;
Durham M.P.P.'s, the eight local area municipalities; the four local Boards
of Education; the Local Boards of Trade and Chambers of Commerce; the
Durham Region Manufacturers Association; the Durham Chapter of the
Urban Development Institute; the Oshawa-Durham Homebuilders
Association; the Durham Labour Council and the Durham Region
Federation of Agriculture.
Respectfully submitted,
W. Arthurs, Chair
.J
405
'~i4
r
The Regional Municipality Of Durham
ADDENDUM TO THE TWELFTH
SECTION 4
REPORT OF THE FINANCE & ADMINISTRATION COMMITTEE
To The Council Of The Region of Durham
September 10, 1997
Members of Council:
The Finance & Administration Committee presents an ADDENDUM to the TWELFTH
Report and respectfully recommends as follows:
6. REPORT #97-F-60 (REVISED) OF THE COMMISSIONER OF FINANCE
REGARDING THE ESTIMATED IMPACTS ON THE REGION FROM THE
See AUGUST 6. 1997 "WHO DOES WHAT" PROVINCIAL ANNOUNCEMENT
Attached
Pages RECOMMENDATIONS TO COUNCIL
53.1 - 66
WHEREAS on August 6, 1997; the Minister of Municipal Affairs and
Housing released an impact analysis which provided the estimated
changes in municipal costs and revenues that will result from the Who
Does What package but also cautioned that the numbers'should.not be
used to estimate over-all impacts on municipalities'; and
b'VHEREAS on August 21, 1997, Bill 152 the Services Improvement Act, to
provide new municipal funding responsibilities related to the Who Does
What package, received first reading by the Provincial Legislature; and
WHEREAS the Regional Council of Durham strongly objects to the lack of
accountability for Regional taxpayers created by the downloading of the
funding responsibility for certain services and the pooling of service costs
across the GTA municipalities without any 'say' in the management,
delivery or scope of these services; and
s
403
1~i5
r -2-
WHEREAS the Regional Council of Durham has serious concerns
regarding the uncertainty of Provincial estimates; the lack of Provincial
direction regarding services to be downloaded; and, the lack of
information regarding the Provincial Vansitional funding for interim
property tax relief with a proposed implementation date of January 1,
1998; and
WHEREAS tqe Region of Durham has already adapted to successive
significant reductions in Provincial funding transfers over recent years
and the Province has promised that actions taken at Queen's Park would
not have an adverse impact on property taxpayers; and
WHEREAS the Province of Ontario expressed its commitment to ensure a
fair and equitable property tax system across Ontario, and given the
acknowledged difficulties with residential undertaxation in Metro Toronto,
the Region of Durham strongly objects to cost sharing with residential
taxpayers of-Metro Toronto; and
LE IT RESOLVED THAT the Province defer its plans to download costs to
the municipal sector until the Ontario Fair Assessment system is fully
implemented and its impacts known to all municipalities.
Respectfully submitted,
W. Arthurs, Chair
404
1~i6
September 10; 1997
TO: The Finafrice and Administration Committee
FROM: R.J. Clapp, Commissioner of Finance
HANDOUT
"REVISED"
RE: REPORT #97-F-60 (REVISED) OF THE COMMISSIONER OF FINANCE
REGARDING THE ESTIMATED IMPACTS ON THE REGION FROM THE
AUGUST 6, 1997 "WHO DOES WHAT" PROVINCIAL ANNOUNCEMENT
RECOMMENDATION
That the Finance and Administration Committee recommend to Regional Council that the
following resolution be adopted:
WHEREAS on August 6, 1997, the Minister of Municipal Affairs and Housing released an
impact analysis which provided the estimated changes ir. municipal costs and revenues that will
result from the Who Does What package but also cautioned that the numbers "should not be used
to estimate over-all impacts on municipalities"; and
WHEREAS on August 21, 1997, Bill 1 ~2 the Services Improvement Act, to provide new
municipal funding responsibilities related to the Who Does What package, received first reading
by the Provincial Legislature; and
WHEP.EAS the Regional Council of Darhant strongly objects to the lack of accountability for
Regional taxpayers created by the downloading of the funding responsibility for certain services
and the pooling of service costs across the GTA municipalities without any "say" in the
management, delivery or scope of these services; and
WHEREAS the Regional Council of Durham has serious concerns regazding the uncertainty of
Provincial estimates; the lack of Provincial direction regarding services to be downloaded; and,
the lack of information regarding the Provincial transitional funding for interim property tax
relief with a proposed implementation date of January 1, 1998; and
WHEREAS the Region of Durham has already adapted tc successive significant reductions in
Provincial funding transfers over recent years and the Province has promised that actions taken at
Queen's Park would not have an adverse impact on property taxpayers; and
WHEREAS the Province of Ontario expressed its commitment to ensure a fair and equitable
property tax system across Ontario, and given the acknowledged difficulties with residentiat
undertaxation in Metro Toronto, the Region of Durham strongly objects to cost sharing with
residential taxpayers of Metro Toronto.
BE IT RESOLVED THAT the Province defer its plans to download costs to the municipal sector
_, until the Ontario Fair Assessment system is fully implemented and its impacts known to all
municipalities.
- -- ~ ~ . ~
L I
• -~ K6YVK/ ny/-r-ou (KGViJ6U)VM IHt LVMMIJJIVNEK Vt FINANCE KEI;AKUING ~ -
'THE ESTIMATED IMPACTS ON THE REGION FROM THE AUGUST 6,1997.
••WHO DOES WHAT^ PROVINCIALANNOUNCEMENT ~ - Page 2.
~.
RECOMMENDATIO.PI/cont'd "REVISED"
AND BE IT FURTHER RESOLVED THAT if the Province proceeds with the download of
costs to the municipal sector that:
i) the Province honour its commitment of no increases in property taxes by providing
sufficient funding to offset any additional costs to each individual municipality;
i i) the distribution of GO Transit costs across the GTA municipalities be based on an
equitable balanced formula that takes into account service levels, system wide benefits
and costs, capital. expansion and benefits to Metro Toronto businesses;
iii) any pooled downloaded costs only include the costs related to a mutually agreed level of '
service in order to exclude the cost differential associated with Metro Toronto's higher
level of service; and
iv) the Province immediately release all relevant information to municipalities and property
taxpayers to validate the Provincial assertion that the transfer of services will ease the
burden on property taxes-
AND BE IT FURTHER RESOLVED THAT the Regional Chair express these concerns to the
Premier of Ontario directly by letter with a copy of iliat letter and this report to be forwarded to
the Minister of Finance, the Minister of Municipal Affairs and Reusing; the Minister of
Community and Social Services; Durham M.P_Ps, the eight local area municipalities; the four
local Boazds of Education; the Local Boards of Trade and Chambers of Commerce; the Durham
Region Manufacturers Association; the Durham Chapter of the Urban Development Institute; the
Oshawa-Durham Homebuiiders Association; the Durham Labour Council and the Durham
Region Federation of .Agriculture-
- 33.z
t ~,
z~~
Knrvnl ari-r-oo-(ntv Wr.Uj VM 1tlC.lVMMI551U1Vh.R VF h7NANCE REGARDING -
THE ESTIMATED IMPACTS ON THE REGION FROM THE AUGUST 6, t997
"W HO DOES WHAT"PROVINCIAL ANNOUNCEMENT - - - Page 3.
REPORT ~.
1.0 INTRODUCTION
On August 6, 1997, the Honourable AI Leach, Minister of Municipal Affairs and
Housing released an impact analysis which was to provide "...the next level of
detail on estimated changes in municipal costs and revenues that will result from
the Who Does What package announced on May I , 1997".
Further, on August 21, 1997, Bill 152, the Services Improvement Act received
first reading by the Provincial Legislature. An overview of Bill 152 is provided in
Report #97-F-59 of the Commissioner of Finance as contained in the agenda for
the September 3, 1997 Finance and Administration Committee.
Attachment # 1 to this report provides a copy of the letter to the municipalities in
Ontario from the Minister of Municipal Affairs and Housing and the applicable
schedule of Potential Allocation of Costs and Revenues to Durham Region.
2.0 ESTIMATED FISCAL IMPACT ON THE DURHAM MUNICIPAL SECTOR
The financial impact information contained in this report has been provided
solely by the Province. The Province has not provided further details
regarding the downioading data ar pooling metirodoiogy which forrns the
basis of their financial analysis. In addition, the financial information is
subject to the following qualification:
The Province has itself indicated that "There are several ways to
allocate costs and revenues ... this packcge should not be used to
estimate overall impacts on municipalities" (Complete Provincial
qualification of the data is provided in Attachment N2).
The Province has estimated that the net costs of downloadins to the Durham
taxpayer may range from $17.9 million to $21.1 million depending upon the
allocation of the residential education tax relief.
The "real" financial impact on the Durham tax~aver increases to the range
of $353 million to $38.5 million when the additional cost of previously
announced downloading is taken into consideration, (elimination of the
Municipal Support and Library Grants and the transfer of Provincial Highways).
See table on following page.
d
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1~i9
2.0 ESTIMATED.IMPACT ON THE DURHAM MUNIC[PAL SECTOR/cont'd
PROVINCIAL IMPACTON THE DURHAM TAXPAYER
OF THE FUNDING TRANSFERS ANNOUNCED BY THE PROVINCE
ALT#1 A T#2
50°/ OF SINGLE
ED-RES. ED. RES.
TAXES TAX RATE
($'s million) ($'s million)
1- Pooled Services
Social Assistance 27.1 27.1
Child Care 3.4 3.4
Public Health 7.4 74
Social Housing 40.8 40.8
Sub Totzl -Social Services 78.7 78.7
GO Transit 21J 21.7
Ambulances 7.6 7.6
Sub To[al - PoolcA Services f 08.0 108.0
2. Non-Pooled Services
Property Assessment 4.5 4.5
I
Farm Tax Rebate 4.9 4.9
Gross P.ceciptTv 3.4 3.4
Other 3.1 3.1
Sub Total Non Pooled Services 15 o 15.9
3. Total Download Costs 123.9 123.9
4. Less Residential Education Tax Relief 106.0 102.8
5. Net Additional Cost 17.9 21.1
HOWEVER THE REAL TAX IM1tPACT' IS
(.A) CH.AtiCES OF AUGUST 6/97 tPER ABOVE) 17.9 21.1
(B) PLUS PREVIOUSL\~ DOWNLOADED COSTS
?tunicipal Supper. Grant .h5 16.5
Library Grans 0.9 0.9
Provincial Hi_eh.ravs '+'+ ~~
Sub Total 17.4 17.4
(C) TOTAL REAL IM1iPAC'I' TO DURHAM
M UNICIPAL SECTOR 353 38.5
..... .........-.-.moo..-•....:..~... .c winnuamvn~n yr ruvnrvt,cncx.AnVnvb
- -THE ESTIMATED IMPACTS ON THE REGION FROM THE AUGUST 6. 1997
^WHO DOES WHAT" PROVINCIAL ANNOUNCEMENT
~.
:~ e~
4.
1«J
RrsruRl ir/i-r-ou (RrvtJtu)VF tHC CUMMIJSIUNER OF FINANCE REGARUtNG
TH,E ESTIMATED IMPACTS ON THE REGION FROM THE•AUCUST6, 1497 ~ -
^WHO DOES WHAT^PROVINCIA6ANNOUNCEMENT - - - -Page S.
2.0 ESTIMATED.jMPACT ON THE DURHAM MUNICIPAL SECTOR/cont'd
The estimated impact of the Provincial downloading is an increase in residential
property taxes ranging from $214 to $144 per household (depending on the
education tax alternatives).
3.0 HIGHLIGHTS OF MAJOR CONCERNS ASSOCIATED WITH PROVINCIAL
ANNOUNCEMENT
3.1 Uncertainty of Provincial Estimates
The Provincial announcement indicated that the impact data should not be
used to estimate an overall impact for Municipalities. In many case's, the
Province has cautioned that the information is unreliable, unavailable and
lacking methodological detail.
• The lack of certainty and the unavailability of financial operational data
related to the downloaded services, places staff in an untenable position in
terms of meting the responsibilities associated with planning, budgetting and
delivering these services with a starting date of less than four months.
3.2 Additional Burden on Municipal Property Tax Base
The impact of the Auw t 6, 1997 Provincial announcement along with the
previously announced cast transfer to municipalities is a direct download
burden of an additional 51.0 billion to the municipal proper , tax base in
Ontario for 1993 as follows:
Cos! of Downloads tc Ontario Municipalities in 1998 S million
Additional Costs to All Municipali[ia
(Net of S0% of Education Credit) 545.3
Elimination of h1unicipal Support Grant 666.0
Downloading of Provincial Highways 75.0
Elimination of Rater Works Support 100.0
Shift in Education P.1-L-'s 100-0
Education Share of Gross Rtxeipts Tax 100.0
Sub Total Costs 15863
Less_ Community Reinvestmrnt Fund (500-0)
Transitional Assistance (annual) f70.0)
Total net Savings to Province 1.0163
It is generally agreed that social service costs should be funded from
income redistributive sources -not the property tax base. In addition,
these costs are subject to volatility in economic downturns which may
impose financial burdens beyond the scope of the property tax base in the
future.
- J ~?
~~~~
- narvn~ w>i-r-oJ {nw~a~u)vr ~nC'(,VMMtJJ1Vl'~tK Vr FIIVAIVIa KEI;AKUING
- ~ THE ESTIMATED IMPACTS ON THE REGION FROM THE AUGUST 6,1997
"WHO DOES WHAT' PROVINCIAL ANNOUNCEMENT ~ Page 6.
33 Provinciai~aim of No Property Taz Increase
• It does not appear poss~bie for Durham to absorb the additional cost being
downloaded from the Province without an increase in property taxes in 1998.
The Region has already absorbed reductions in Provincial funding through the
Social Contract, Expenditure Control Plan, Municipal Support Grant and red
circle funding for the Homes for the Aged totalling approximately $24 million
and implemented a Re-engineering process to save an initial $6.0 million with no
increase or very slight increases in property taxes over the past few yeazs.
3.4 Lack of Provincial Direction on Downloaded Services
Many key decisions regarding the allocation of costs. service de]ivery and
operational decisions have not been made by the Province relating to those
services scheduled to be downloaded on January 1, 1998 (including Social
Housing, Ambulances, GO Transit, Welfare, etc.).
Moreover, the Province has not yet indicated which tier of municipal government
is to assume responsibility for each downloaded service.
It is imperative that these decisions be finalized in the very near future so that
plans can be fmalized by municipalities for the delivery of services commencing
on January I, 1998.
3.5 No Information on Transitional Funding
The Province has not announced the details on the distribution of the Communitv
Reinvestment Fund (500 million), transitional assistance (570 million) nor
restructuring assistance (5800 million over four years).
While transitional funding may provide interim financial relief to the local tax
payer, this type of funding cannot be relied upon in the long term to offset the
additional costs resulting from the downloaded services.
4.0 FISCAL IMPACT OF THE POOLING OF DOWNLOADED SERVICES
• Approximately $300 million of service costs would be shifted from Metro
Toronto to the 905 Regions effective January 1, 1998 (Social Assistance, Child
Care, Public Health, Ambulance, Social Housing and GO Transit) as a result of
the pooling of sen ices across the GTA.
The pooling of GO Transit costs based upon "morning boardings" is an example of
the significant biases against the 905 Regions in favoer of Metro Toronto.
J~
> >2
L L
REPORT #97-F-60 (REVISED) OF THE COA1M(SSIONER OF FINANCE REGARDING
'TH.E ESTIMATED IMPACTS ON THE REGION FROM THE AUGUST 6, 1997
"WHO DOES WHAT" PROVINCIAL ANNOUNCEMENT ~ Page 7.
~'
4.0 FISCAL IMPA£I' OF THE POOLING OF DOWNLOADED SERVICES/cont'd
• The Province has not provided "pre pooling" cost information nor the details
concerning the methodology used to determine the fiscal impact of pooling upon
a
individual 905 Regions.
• However, based on previous analysis conducted by Regional staff, it is estimated that
the marginal cost savings to the Durham municipal sector due to pooling of social
services will be more than offset b ty he sienificant additional costs to Durham related
to the t? olin° of GO Transit Social Housino Health and Ambulance services.
5.0 PAY WITHOUT SAY -NON ACCOUNTABLE TO REGIONAL TAX PAYERS
• Municipalities will be obliged to "pav without sad" by contributing financially for a
number of functions without any accountable input to the management and delivery
of both downloaded and pooled services.
- In addition, municipalities may be asked to assume contracts that the Province has
entered into with third parties (e.g. ambulance, social housing etc.).
• It is highly unlikely that the Region will be able to achieve savings of approximately
2.0'/o per year or $4 L 1 million over titree.yeats (refer to page 5 of Attachment iF i) as
suggested by the Province for pooled services for which the Region has no
adminisiraiive authority or accountability.
• The concept of saving $41.1 million from efciencies as estimated by the Province to
offset the cost of the downloaded sen•ices for Durham is flawed as it:
(1) represents a total savings of 2% per year for three yeazs -but applied in year 1 to
offset the Provincial download cost
(2) includes eficiencies on 2% of the Region's uncontrollable budget costs relating to
Police and General Welfaze (approximately 80% of the current general tax levy
budget).
(3) includes savings on the cost of downloaded and pooled services for which the
Region will have no accountable input i.e. pay without say
• Furthermore, it is unreasonable for the Province to contend that Durham Region can
save an additional $41.1 million in savings through efficiencies over and above the
$24 million in funding reductions previously absorbed by the Region due to the
Social Contract, ECP, Municipal Support Grant elimination and red circle funding for
Homes for the Aged.
6.0 1998 REGIONAL MUNICIPAL SECTOR TAX BILL
• This Provincial downloading initiative will further "entangle" the services delivered
by the Durham municipal sector and result in an increased level of confusion for the
taxpayers of Durham:
~8 '2~3
REPORT#N7-t-6UtRt~wtu)t/r ~~ttLVMhtIJJ~~1wLK Vf t11~Ai~•.gncy,•rt~~nv
THE ESTIMATED IMPACTS ON THE REGION FROM THE AUGUST b, 19?7
"W HO DOES WHAT"PROVINCIAL ANNOUNCEMENT
~ ,.
6.0 1998 REGIOtYAI MUNICIPAL SECTOR TAX BILL/cont'd
COST COMPONENTS OT; THE PROPERTY TAX B[LL
Educatlort
Lxal
SUiVIMARI'
pion
Mega CKY
Educadon
GTSB
• In 1998, the Durham Municipal sector will be facing unprecedented budget related cost
pressures. Not only will the Region be faced with renewed budgetary requirements for
current operations such as roads and police, but also the local tax bill will he affected bv:
• Impact of market value reassessment
• Cost of new services downloaded for the first time
• Changes in the sharing of funding for existing services
• Charges imposed by the Greater Toronto Services Boazd
• Cost of services "pooled" with Metro Toronto
• Limitations imposed on services and costs for which development charges can be
collected
8.
• In light of these fiscal impacts facing the Durham Municipal Sector in 1993, it is
recommended that the Province delay the imposition of the downloading and pooling of
municipal services until such time as market value reassessment has been fully implemented.
• If the Province does proceed with the downloading and pooling initiatives in 1998, Provincial
funding to municipalities must be realigned to ensure that there is no additional tax burden to
the local propeRy tax payer in 1998 and subsequent years.
R.J. app, CA
Commissioner of Finance
Recommended for Presentation to Committee
G.H. Cubitt, M.S.W.
Chief Administrative Officer _ J ~ o~.K•.nr:roarsw-o-w
1 J /~ n
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MirRStryp6
Municipal Affairs
r ° a;~d Housing
OKCe of the Minister
777 Bay SVeet
Toronto ON MSG 2E5
(a16)585-7000
August 6, I997
To all Heads of Council:
Ministere Qes
Affaires monidpafes
et du Logerrrert
Bureau du m" -
777 rue Bay
Toronto ON MSG
(at67 sas-7ooo
CLERK'S flEPnRfMt:rvt
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I
.ornane. ... ``',
I am writing to provide you with the ne_r level of detail on estimated changes in municipal costs
and revenues that will result from the E~Lo Does What package announced May 1. We provided
this data yesterday to the Provincial-Municipal Implementation Team and the Social and
Community Health Services Implementation Team for their information.
I know you are concerned about your ability to begin your 1998 budget process, and I understand
that concern. I believe the number in r^;u package, along with the information provided about
how these numbers were amved at will ?_ilow you to begin the process-
Please keep in mind, though, that these numbers do not represent the actual impact of Who Does
What on your municipality. They aze based on the current cost of providing the services in
question. The wlroIe point of Who Does What is to eliminate duplication and gut i*r place a more
efncient and less expensive way to deliver services- The cost of delivering these services in the
future will be lower than the current cos-s shown here.
The n.rmbers in this package do not show- the effect of the Community Reinvestment Fund. That
permanent 5~0O million a veaz pro~*at, _. tong with C70 million in adaitional artnual transition
funding, w1I help municipalities that face unique circumstances-
You will notice as well that we have calc-,r1aL°d what the impact of Who Does WlrzI would be if
each municipality fmds new efflciencies_ If municipalities can save about two cents on the dollar
each year over the next three years, they uilI be able to offer property taxpayers a tax cut by the
year 2000. Across the province, property tax cuts should average five to 10 per cent
At the provincial level w-e are working hard to deliver services as efficiently as possible. We are
cutting internal administrative costs by a third, eliminating the deficit and delivering a tax cut,
.while absorbing reductions in federal mzrtzfer payments. The 52.5 billion extra tax room you
will receive when we cut residential pror:e_^.v taxes for education in half, the Community
Reinvestment Funds and the new flexibility you will have to deliver services cast effectively will
put you in a good position to cut taxes too. I encourage you to set your own tax reduction target,
and we will provide you with the tools to help you achieve it.
n~~auuaeii~ I/i .
_ ~ Page 2 of 5
/.
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The government also announced today that the cost of social services, social housing, public
health services, and ambulance. services will be equalized across the. Greater Toronto Area .G0
Transit costs will be shared by GTA regions, the new City of Tomnto and Hamilton-Wentworth,
which is also served by GO_ We made this decision.because the GTA is really a single
catchment area for social and health services. This equalization will allow Toronto to meet the
demands it faces; with the rest of the GTA paying.its fair share of the cost The economic health
of the whole region depends on a solid core. Everyone in the GTA loses if the core starts to
erode..
In addition to the over-all numbeis, the lvfmisuy of Finance released preliminary assessment data
today to help municipalities plan for the new Ontario Fair Assessment System. As well, the
Ontario Provincial Police has released cost-estimates for municipalities that until now have been
receiving local policing services from the OPP at no direct cost to their municipal taxpayers.
That information is enclosed
i here aze many levels of govennmenf, bin only one taxpayer. The. people of Ontario will hold all
elected ofttcials accountable fordelivering the best possible services while holding taxes down_
If you have questions about this package of numbers, please call your local office ofthe Ministry
of Municipal Affairs and Housing Regional Operations litanch. For information on specific
programs, please contact the approprate ministry.
Sincerely,
L a~
'Minister
G1
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fpp M )~Y old
Oe ~a
?~~6
mews Release
Communique
Ministry of Ministers des
Municipal Affairs Affa"ues murocipales
and Housing et du Logement
For immediate release
August 6, 1997
Page 3 of 5
O Ontario
Leach says municipal tax cuts achievable
Municipalities can cut taxes, Municipal Affairs and Housing Minister AI Leach said today
following the release of estimated changes in municipal costs and revenues that would result
from the government's Who Oces V~fiat initiative.
He said the numbers show municipalities will be able fo manage the new alignment of municipal
and provincial responsibilities announced May 1. The new alignment, based on a proposal from
the Association of Municipalities of Ontario, is intended to bring education costs under control,
and provide better services at lower cost to taxpayers.
"By finding new efi;ciency savings of about two cents on the dollar per year over the next three
years, municipalities will be able to lower their residential preperty taxes by the year 2000,"
Leach said. "Across the province, property tax cuts should average five to 10 per cent.'
"Every level of y^ovemment, every business, every taxpayer in Ontario has a responsibility to
manage within his or her means,' Leach said. 'The province is cutting internal administrative
costs by a third, eliminating the deficit and delivering a tax cut, while absorbing reduc5ons in
federal transfer payments. Municipalities should set their own tax cut targets, and we've given
them the tools to help them do it_'
Since the Greater Toronto Area is really a single catchment area for sodaf and health sevices,
those costs -along with GO Transit costs -will be equalized across the entire GTA
'Metro - at the heart of the GTA - cerries more than its fair share of the responsibility for social
services in the GTA,' Leach said. 'In some cases, people who need services cross municipal
boundaries to get them. It's only fair to equalize the cost of those services, especially since the
economic and social health of the whole region depends on a solid core.'
The government is also implementing a new assessment system that will make property taxes
fairer, more accountable, more consistent and more understandable for taxpayers. Preliminary
data to help municipalities plan for the new system were released today.
Also released today were cost estimates that are part of the process to bring fairness to police
financing in Ontario. Currently 576 municipalities receive local policing services from the Ontario
Provincial Police at no direct cost to the;r municipal taxpayers while 202 municipalities pay for
the same services. OPP costing estimates are based on a standard formula that takes into
account the actual cost of delivering police services in each municipality.
l2
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Page 4 of 5
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t
The release of this costing information is a first step Toward enabling every municipality in
Ontario to decide how best to provide police services far its residents. Local governments will
make decisions about local services, while the provincial govemment will ensure province-wide
standards of policing and community safety.
To help municipalities make the transition to their new roles under Who Does What, the
govemment will spend 5800 million over three years through the Municipal Capital and
Operating Restructuring Fund to support municipal restructuring. As well, the govemment will
establish a permanent S500-million-a-year Community Reinvestment Fund and provide S70
million a year in additional transition assistance for municipalities with special needs.
Two teams of municipal representatives are advising the govemment on implementation issues.
The Social and Community Health Services Implementation Team and the Provincial-Municipal
Implementation Team will look at how responsibilities should be transferred, how new municipal
costs should be allocated, and on what basis the Community Reinvestment Funds should be
distributed. As the teams' recommendations come in and the govemment makes decisions on
them, municipalities should be in a much better position to budget for 1998.
"The Community Reinvestment Funds, the new flexibility municipalities will have to deliver
services cost-effectively and the 52.5 billion in tax room they will have when we cut residential
property taxes for education in half should put them in an excellent position to cut property
taxes," Leach said.
"There are several levels cf govem:.,ent, but only one taxpayer," Leach added. "The people of
Ontario will hold all elected officials accountable for delivering the best possibly services white
ho{ding taxes down.°
-30-
For more information, please contact:
Myra Wiener Christine Burkitt
Municipal Finance Branch Office of the Minister
{4'16) 585-7200 (416) 585-6932
For information on Ontario Provincial Police costs, please contact:
Stephanie Bolton Graham Gleason
Communications Branch Ontario Provincial Police
Ministry of the Solicitor General (705) 329200
and Correctional Services
(416} 325-9692
Please visit the Ministry of Municipal Affairs and Housing's World Wide Website at
http://www. m mah.gov_on.ca
Disponible en frangais
G~
1 );
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f
POTENTIAL ALLOCATION OFCOSTS ANi.i REVENUES
AS PEA" MAY 1,1997~AGREEMENT
$"Million
Social Assistance
Chad Care
Public Health
ial Housng
dren`S Aid Societies
Transit
isQ -Operating and Capital
Inspections
offences Nei Revenues
rty Assessment
3ed Forests /Conservation t2~ds
Tax debate
Receipts Tams
Net Change n Municpal Cosh /Revenues:
Post-WDW Municpal Own-Purpose Spend"ng
gficiencies try 2000-01
(23go per year n each of nett 3 years)
WDW Net Change After Elflctancies
Aa Ye of Post-WDW Municipal Own-Purpose Spendng
A/tunat/w l
SO%of Ed.
aes. Tams
27.1
3"4
7"4
7.6
40.6
{2.6)
22.7
5.4
OA
OA
02
OA
(1.7}
a~
4"6
1.2
4.9
3.4
Alterrra~ y
Sirgle Ed. Aes.
Tax Rate
2T.1
3.4
7"4
7.6
40$
(2.6}
22.7
5:4
OA
0.0
02.
OA
(1.~
o.~
4b
1.1
4.g
3.4
1T.9 2~2
6063
(41.2 )
(23.1)
(3.8)
6083
(41.1)
(29.6}
(33)
wr tgurea are esttnates. see accomParryng notes. Transfer of responsib83)es~nd related changes may
require the appnrvai of the l.egislatttre, where applicable. -" ,
6 s~
~2~~
a ~ ~ ~
r BACKGROUNDER
A New Way of Doing Business
On May 7 , 1997, the Ontario government announced an agreement on transfers of
resoonsibifities between the province and municipalities under the Who Does What
initiative.
The Who Does What initiative has three goats:
- controlling the spiralling cost of education
- making governments Iess_costiy and more effective by disentangling and by
eliminating duplication in service delivery
- bringing tax fairness to Ontarians in every municipality.
On itilay 1 , the province released information on the province-wide impacts of these
transfers of responsibilities. The attached information shows these impacts at The
upper-tier district and municipal level.
How to use the attached information on local impacts of 4VDW transfers
This information is intended to assist the provincial/municipal implementation teams
as they develop recommendations for the government on how transfers of
responsibilities should be implemented. There are several ways to allocate costs
and revenues; this package illustrates only one. For the following reasons this
package should not be used to estimate over-all impacts on municipa(ities-
- Many key decisions around the cost-sharing arraneements between the province
and municipalities, the allocation of costs and revenues across municipalities or
regions, and the allocation of provincial restructuring and support funds have not
been made- Distribution of the 5500 million annual Community Reinvestment
Fund and the S70 million annual Additional Transition Assistance will have a
significant effect on the outcome. These decisions will be made through the
ongoing consultations between the province and representatives of municipal
governments.
- Many municipal services will be facing some sort of change. Whether it is
greater responsibility for current municipal services, such as sewer and water, or
taking on a new rote such as social housing, municipalities need to look at how
to provide services in a more efficient and effective way. By using the tools and
flexibility to find innovative and different ways of delivering services,
municipalities should be able to find savings and efficiencies.
6a
.~ 0
Page 2 of 2
'. ~ ~ ~'- Assessment numbers used for allocation are still preliminary as new OFAS data
will not be ready u~xtil fall '97. The weighting factor is also an approximation
ifurther decisions on tax ratio target ranges must be made before final
weighting).
- The attached information is based on ministries' most up-to-date information on
program costs- Due to the nature of individual programs, data for some
programs is more current than for others.
- Note that while the data are shown at the upper tier level, this is not intended to
indicate that all program impacts will be shared at the upper tier. For some
programs, such as policing, costs will be allocated a the lower tier.
- The information provided in this package is only a next step. More will be
provided as further decisions are made. Ultimately, decisions made by
municipalities as they set their budget priorities will determine what the bottom
line will be in each municipality.
Aucust 6, t 997
66
_~ I
ATT CHMENT D10. 2
COST OF REGIONAL .WATER,
SEWER AND TRANSPORTATION
SERVICES
REPORT
September 1997
totten sims hubicki associates
engineers architects and planners
i~
ii
totten sims hubicki associates
LETTER OF TRANSMITTAL
September 17, 1997
Mr. S.A. Vokes, P.Eng., Director of Public Works
Corporation of the Municipality of Clazington
Municipal Administration Centre
40 Temperance Street
BOWMANVILLE, Ontazio
L1C 3A6
Deaz Sir:
513 DIVISION STREET, P.O. BOX 970, COBOURG
ONTARIO, CANADA K9A 4W4
(905)372-2727 FAX (9051372-3627
Re: The Corporation of the Municipality of Clarington
Report on The Cost of Regional Water, Sewer and Transportation Services
TSH Project No. 10676
We aze pleased to submit the above noted report for your review and approval.
The report identifies and summazizes in general terms, the cost of providing Regional Water, Sewer and
Transportation Services in the Municipality of Clazington. Both operating and capital costs have been
identified through a review of Region of Durham documentation and discussion with Region staff.
A summary of study findings aze attached for your convenience.
During preparation of this repoR, information was received from the staff of the Region of Durham and the
Municipality of Clazington. Their assistance is gratefully acknowledged.
Yours truly,
totten sims hubicki associates
D.R. Bourne
Projects Manager
William McCrae, P.Eng.
Design/Construction Engineer
WMC/DRB/ag
7b7/wtc/97
encl.
pc: Mazie Mazano, Treasurer, Municipality of Clazington
ENGINEERS ARCHITECTS AND PLANNERS
MUNICIPALITY OF CLARINGTON
COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
SUMMARY OF COSTS FOR REGIONAL WATER, SEWER & ROAD SERVICES
IN CLARINGTON
OPERATIONS AND MAINTENANCE
ITEM CLARINGTON % OF 1997 CLARINGTON % OF 1997 NET
SHARE OF REGION SHARE OF REGION COST
REGION SERVICE BUDGET RECOVERIES BUDGET
star Supply 52,565,651.81 13.20% 52,617,613.02 9.4% 551,961.2
nitary Sewerage 52,585,729.41 14.90% 52,475,778.30 8.0% (5109,951.1
oad System 52,023,721.45 14.60% 5489,292.74 14.5% ($1,534,428.7
OTAL 57,175,102.67 14.18% 55,582,684.06 9.4% (51,592,418.60
CAPITAL COSTS
ITEM CLARINGTON ESTIMATE ESTIMATED COMMENTS
SHARE OF TAX LEVY D.C.
REGION SERVICE SHARE SHARE
COST ARE FROM THE 1996-2015
star Supply 594.000,000 522,500,000 571,500,000 CAPITAL COST SUMMAY
PREPARED BY REGION STAFF
COST ARE FROM THE 1996-2015
Sanitary Sewerage 577,900,000 536,600,000 .541,300,000 CAPITAL COST SUMMAY
PREPARED BY REGION STAFF
COSTS FROM 1991 DEVELOPMENT
Road System 553,000,000 $24,500,000 528,500,000 CHARGES STUDY ADJUSTED
FOR LACK OF MTO SUBSIDY
OTAL 5224,900,000 583,600,000 5141,300,000
Cotten sims hubicki associates
MUNICIPALITY OF CLARINGTON
' COST OF REGIONAL WATER, SEWER AND
TRANSPORTATION SERVICES
' September 1997
t
totten sims hubicki associates
' engineers architects planners
MUNICIPALITY OF CLARINGTON
COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
TABLE OF CONTENTS
1. INTRODUCTION ............................................ 1
2.0 WATER DISTRIBUTION ....................................... i
2.1 Description of Facilities
2.2 Operating Costs
2.3 Capital Works
2.4 Recovered Costs
3.0 SANITARY SEWERAGE ....................................... 6
3.1 Description of Facilities
3.2 Operating Costs
3.3 Capital Works
3.4 Recovered Costs
4.0 TRANSPORTATION .......................................... 11
4.1 Description of Transportation Network
4.2 Operating Costs
4.3 Capital Costs
4.4 Recovered Costs
TSH Project No. 12106M
16626~IS/SIC
totten aims hubicki associates
i~
I' MUNICIPALITY OF CLARINGTON
COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
ii
1. INTRODUCTION
' On January 1, 1998 the province of Ontazio is expected to form the Greater Toronto Services
Boazd (G.T.S.B.). The Mandate of the G.T.S.B. is to coordinate azea wide services within
the Greater Toronto Area (G.T.A.). In time there is a possibility that the G.T.S.B. could
replace the Metro and Regional levels of government. The Municipality of Clarington is
' concerned that should this happen, they would be a small player in the G.T.S.B. and therefore
have little say in decisions directly impacting the delivery of the Regional level of services to
their Municipality.
As an option to joining the G.T.S.B., Clazington would like to explore the potential for
forming a single tier Municipal Government. Under this scenazio services currently provided
by Durham Region would be assumed by Clazington or purchased from adjacent
municipalities or other agencies.
' The first step in investigating this scenario is to define the current cost of delivering Regional
Services. This report does this in general terms for water, sewer and transportation services
through the review of Region of Durham budget documentation.
It has been assumed in prepazing this report that all facilities would be handed to the
Municipality at no cost and debt free.
2.0 WATER
2.1 Description of Facilities
Five azeas within the Municipality of Clazington aze serviced by municipal water distribution
systems. The Courtice Urban azea is fed via the City of Oshawa from a network of
interconnected supply plants located in Oshawa, Whitby and Ajax. Bowmanville is supplied
from two water sources. The Bowmanville Water Supply Plant draws water from Lake
Ontazio to the south while the Mackie Creek Well System provides an additional source to the
north. The Newcastle Water Supply Plant feeds both the Newcastle Urban area and
Newtonville using Lake Ontazio as its supply. Orono is serviced by a system of wells located
southwest of the Village.
An inventory of major system components is illustrated on Drawing No. I. Distribution
system components as of February 1996 aze summazized on Table 2.1. Inventory information
was obtained from Regional staff and budget documentation.
totten Sims hubicki associates
1
MUNICIPALITY OF CLARINGTON
' COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
I'
i~
' 2.2 Operating Costs
Information regazding operating costs was obtained from the "1997 Current and Capital
' Budgets Works Committee Works Department Water Supply" budget document. Costs aze
summazized on Table 2.2. It was assumed that all maintenance operations were performed
from the Orono Depot. Budget figures for 1997 were used. Items 3 to 6 on Table 2.2 were
' referred to as "Other Costs" in budget documentation. They were assumed to be operational
in nature and not related to capital works. A portion of these costs was prorated to Clazington
as noted on Table 2.2.
' 2.3 Capital Works
A summary of estimated capital expenditures for the period from 1996 to 2015 is provided in
Table 2.3. Information was obtained from Region of Durham staff. This 20 yeaz forecast
has no official status as it has not been endorsed by either the Regional Works Committee or
' Council. The costs aze expressed in 1996 dollazs and represent the best available information
on capital requirements based on current Region and Clazington Official Plans. Capital costs
shown on Table 2.3 have been broken into 2 funding streams so that impacts on Development
' Chazges and Tax Levy funding sources can be determined.
2.4 Recovered Costs
' Region budget documentation identifies a number of sources of Revenue. The primary source
is chazges based on metered water usage. Other sources of revenue include chazges for
hydrant usage, service installations and metre installations. A summary of estimated revenues
for 1997 is presented on Table 2.4.
totten aims hubicki associates
MUNICIPALITY OF CLARINGTON
COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
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COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
3.0
3.1
3.2
SANITARY SEWERAGE
Description of Facilities
Three Urban Centres within Clazington aze serviced by municipal sewer collection systems.
Courtice connects by gravity to the City of Oshawa at two locations. The effluent from
Courtice is treated at the Harmony Creek Water Pollution Control Plant (W.P.C.PJ.
Bowmanville and Newcastle Villages both have their own W.P.C.P, and associated collection
systems.
The location of major sanitary sewerage facilities is illustrated on Drawing No. 1. A
summary of collection systems components as of June 1995 is provided on Table 3.1.
Operating Costs
Information regazding operating costs was obtained from the "1997 current and Capita!
Budget, Works Committee, Works Department Sanitary Sewerage", budget document. Costs
aze summazized on Table 3.2. It was assumed that all maintenance operations were
performed from the Orono Depot. Budget figures for 1997 were used. Items 3 to 6 on
Table 3.2 were referred to as "Other Costs" in budget documentation. They were assumed to
be operational in nature and not related to capital works. A portion of these costs was
prorated to Clazington as noted on Table 3.2.
totten aims hubicki associates
MUNICIPALTTY OF CLARINGTON
COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
' 3.3 Capital Works
' A summary of estimated capital expenditures for the period from 1996 to 2015 is provided in
' Table 3.3. Information was obtained from Region of Durham staff. This 20 yeaz forecast
has no official status as it has not been endorsed by either the Regional Works Committee or
Council. The costs aze expressed in 1996 dollars and represent the best available information
on capital requirements based on current Region and Clazington Official Ptans. Capital vests
shown on Table 3.3 have been broken into 2 funding streams so that impacts on Development
Chazges and Tax Levy funding sources can be determined.
3.4 Recovered Costs
' Regional budget documentation identifies two major sources of revenue. The primary source
is user fees based on a percentage of metered water usage. The second source of revenue is
chazges for installation of sewer services. A summary of estimated revenues for 1997 is
_ presented on Table 3.4.
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Mi1NICD?AL1TY OF CLARINGTON
COST OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES
4.0
4.1
TRANSPORTATION
Description of Transportation Network
I1
The Region of Durham operates 145.95 kilometres of roadways and 19 sets of traffic signals
located in Clazington. Of the 19 sets of traffic signals 14 aze owned by the Region and 5 aze
owned by Clazington. The Regional Road System within Clazington is illustrated on Drawing
No. 1. A summazy of pertinent data relating to the transportation system is shown on
Table 4.1 below.
September 1997.
4.2
Operating Costs
Information regazding operating costs was obtained from the "1997 current and Capital
Budget, Works Committee, Works Department General Levy Program" and Regional Staff.
In identifying operating costs for Municipal Roads in Clazington it was assumed that all road
maintenance activities were performed from the Orono Depot. Maintenance of traffic control
devices such as pavement mazkings, signs and traffic signals aze performed from the Oshawa
Depot. Clazington's shaze of this work was prorated using the percentage calculated for these
operations shown in Table 2.1. Transportation related costs such as Engineering and
Operations were prorated as identified on Table 4.2.
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Note: Lane and Road kilometres aze as of January 1, 1997. Signal Data is from
MUNICIPALITY OF CLARINGTON
' COST' OF REGIONAL WATER, SEWER AND TRANSPORTATION SERVICES 12
4.3 Capital Costs
' Future capital works expenditures were obtained through a review of the Region's
Development Chazges Report which provides an estimate of future spending requirements. In
reviewing development chazges data, it was assumed that all projects would be completed by
' the yeaz 2011. A summary of estimated capital expenditures for the period from 1992 to
2011 is provided on Table 4.3. The costs aze expressed in 1991 dollazs. It should be noted
that MTO subsidy was included as a funding source and it is no longer available.
4.4 Recovered Costs
' The primary source of recoveries for the Transportation System is work done for other
municipalities in the maintenance and operation of traffic control devices such as pavement
mazkings, signage and signals. Recovered costs aze summazized on Table 4.4.
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FACILITIES