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Staff Report
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Report To: Special General Government Committee
Date of Meeting: February 24, 2020 Report Number: FND-002-20
Submitted By: Trevor Pinn, Director of Finance/Treasurer
Reviewed By: Andrew C. Allison, CAO Resolution#: #GG-123-20, C-064-20
File Number:
Report Subject: 2020 Operating and Capital Budget
Recommendations:
1. That Report FND-002-20 be received;
By-law Number:
2. That Council approve the 2020 Operating and Capital budgets, including "external
agencies" as outlined in the 2020 Draft Budget Book, at an estimated tax levy impact
of 1.83%, exclusive of tax policy impacts, as directed in FND-002-20;
3. That Reserve and Reserve Fund contributions and new Reserve/Reserve funds be
approved as shown in the 2020 Draft Budget Book;
4. That the financing of capital projects, as outlined in the attached documents, be
approved;
5. That any cash flow shortfall in the Development Charges Reserve Funds be interim
financed from the Municipal Capital Works Reserve Fund and General Municipal
Reserve Fund, to be repaid with interest, as cash flow permits;
6. That Report FND-002-20 be adopted by resolution in accordance with provisions of
Ontario Regulation 284/09 of the Municipal Act, 2001;
7. That the appropriate by-laws to levy the 2020 tax requirement for Municipal,
Regional and Education purposes be forwarded to Council for approval, once final
tax policy information is available; and
8. That all interested parties listed in Report FND-002-20 and any delegations be
advised of Council's decision.
Municipality of Clarington
Report FND-002-20
Report Overview
Page 2
The purpose of this report is to provide necessary information to Council in order to approve
the 2020 Capital and Operating Budgets. The report includes several important components
and the Budget Book provides specific details. There are significant capital considerations
for 2020 that further enhance the Municipality's capital infrastructure. The Budget is
continuing to carry out the principles and objectives of these important Council priorities. The
2020 Capital and Operating Budget will consider these items, along with a new Strategic
Plan to be adopted later this year.
1. Background
2020 Draft Budget and Levy Impact
1.1 This year's "Clarington Budget 2020: A vision for a strong community" was released to
Council and the public on February 7, 2020. This year's budget book takes on a new
format as the Municipality moves to align budget communication practices with best
practices in the sector. The Budget was also placed on our website and has been
advertised through social media accounts.
1.2 In September 2019, Council directed Staff to bring forth a budget for 2020 with a target
municipal levy increase of 2.0%. Staff worked diligently to meet that target. The draft
budget, including proposed new staffing, increased reserve fund transfers and
maintaining service levels was reached with a 1.83% municipal levy increase.
1.3 The average residential property assessment for 2020 is approximately $390,700 (2019 -
$367,632). A 1.0% increase in the tax levy would be approximately $14.64 annually
(2019 - $14.14) on the property tax bill on the average assessment. As a result of the
proposed budget the average municipal increase is $26.79.
1.4 A 1 % increase in the levy translates into approximately $598,200 in additional revenue
(2019 - $567,600) to the Municipality.
1.5 The Province of Ontario has released its rates for education taxes. In 2019, the
education portion on the average assessment would have been $592 this is anticipated to
increase to $598. The Province's rates are determined by looking at the assessment
base for the whole Province and determining the amount needed to be raised for
education. A single rate is applied across the Province for residential taxpayers.
1.6 The Region of Durham's Budget will be presented to Regional Council in late February. It
is anticipated that the impact to the Clarington taxpayer will be lower than the average
Durham resident as the assessment base in the other municipalities is higher than in
Municipality of Clarington
Report FND-002-20
Page 3
Clarington. It is anticipated that approximately 50% of the total property tax bill will still be
related to the Region of Durham; however, at this time it cannot be confirmed.
Items for Council Consideration
1.7 The budget book included a list of items for consideration on page 33. These items may
have been deferred by Staff in order to meet the 2.0% target or brought forth by members
of Council and the public for consideration.
1.8 Items for consideration include approximately $439,500 in operating costs and
$1,830,000 in capital costs. If all these items were to be included there could be an
additional 3.93% to the tax levy; however, this could be mitigated through use of
development charges (where allowed) or reserve and reserve funds (where feasible).
1.9 An item not included on this list was an increase to the Future Staffing Reserve Fund. It
may be desirable, depending on Council's direction with potential new firefighters, that the
contribution to this reserve fund be increased by $125,000 to $375,000. This $125,000
increase represents an increase of 0.21 % or $3.06 to the levy.
2. Tax Rate Stabilization
2.1 Historically, Clarington has drawn on our Rate Stabilization Reserve Fund approximately
$800,000 per year.
2.2 In 2019, the general draw was decreased by $200,000 to $600,000 with a specific draw
for forestry being added. The intention was to transition the reliance on the reserve fund
to balance the budget generally towards a more specific use for "one-time" items. This
was anticipated to take four years.
2.3 In order to maintain the 2.0% target, a reduction in the transfer from the Tax Rate
Stabilization Reserve Fund was not proposed in 2020.
2.4 The balance in the Tax Rate Stabilization Reserve Fund is sufficient to withdraw the
proposed $600,000.
3. Tax Policy Changes
3.1 A long-term strategic tax policy plan was initially approved in 2002 by the Region of
Durham (who has legislative authority over tax policy), that may have an impact on final
tax rates. The 2020 update is anticipated was presented to Regional Finance and
Administration Committee in February 2020. Any tax ratio changes impact upon the
relative share of the total taxes that each property class pays. A copy of the Region's
report is attached marked Attachment 1.
Municipality of Clarington Page 4
Report FND-002-20
3.2 The 2020 report included a recommendation that the Region not implement a reduced tax
rate for the first $50,000 of assessment on small-scale value-added commercial activities
on farms, which was announced by the Province in 2018. This recommendation was due
to the limited impact to taxpayers (a total of seven properties in all of Durham Region with
a total assessment of $315,000) and the administrative costs of implementation.
3.3 The 2020 report also addressed a request from Whitby for the Region to match support
for a heritage property tax rebate. The Region is only allowed to create a program in a
municipality that already has a program; therefore, the Region's program would be limited
to Ajax (2 properties), Whitby (30 properties) and Oshawa (8 properties). It was
recommended that the Region not match any of the local heritage property tax rebate
programs at this time as the Region has an objective of treating similar properties in a
similar fashion across the whole region.
3.4 Additionally, Clarington is affected by tax policy decisions made on the education side by
the Province of Ontario. This stems from municipalities retaining the education portion of
eligible payment in lieu (PIL) properties such as Ontario Power Generation. In the 2008
Provincial Budget, a provincially mandated reduction in the industrial education rate was
announced. The rate has not been announced for 2019. This could result in tax policy
impacts of lost revenue to Clarington which will be incorporated into the final tax rate by-
law.
4. Staffing Requests
4.1 This year, Department Heads are making the following requests:
• Planning Services — (a) convert contract Planner I to full-time Planner 1 ($20,900); and
(b) convert full-time Clerk I to full-time Planner II ($24,900)
• Community Services — (a) new full-time Aquatic Programmer ($80,800); and (b) new
part-time Customer Service Programmer ($51,400)
• Operations — (a) temporary worker extensions (two additional months) for five staff
($42,950); and (b) convert part-time Clerk II to full-time ($19,600)
• Clerks — new full-time Municipal Law Enforcement Coordinator (no levy impact)
• Emergency & Fire Services — four full-time firefighters ($318,400)
4.2 Finance, Legal, Corporate Services and the CAO's Office have not requested any
additional staff for 2020.
Municipality of Clarington
Report FND-002-20
Page 5
4.3 The specific rationale provided by the departments in support of these requests is set out
in Attachment 2 to this Report. The compensation figures shown above and in
Attachment 2 include salaries and benefits (if applicable).
4.4 All of the staffing requests have been vetted having regard for the recommendations
contained in the Grant Thornton Organizational Structure Review Report. In the opinion
of staff, none of the requests with or will prejudice the Municipality's ability to implement
any of the recommendations in that report. The one exception is in relation to Emergency
& Fire Services (Recommendation #22). Grant Thornton has stated that "our
recommendation is that an external review of the fire suppression service delivery model
(i.e. the number and composition of staffing, number of firefighters per truck on calls) be
completed".
4.5 Included in the proposed budget for 2020 are all of the above positions except for the four
full-time firefighters. As mentioned above, the inclusion of the four firefighters prior to the
results of the staffing review, which is included in the 2020 Budget, could prejudice the
results. The four firefighters have been included on the Council Consideration list on
page 33 of the 2020 Draft Budget.
5. Operating Budget Commentary
5.1 The 2020 Draft Budget Book provides summary information for all the changes in the
operating departments and sub -departments. This information was provided to ensure
that Council was aware of the projected change from 2019.
5.2 Significant changes to operating includes the movement of forestry related expenses to
the Operations Parks sub -department level. This consolidates expenses that may have
been in parks, roads and ditching to one activity within the Parks sub -department.
5.3 A significant increase has also been proposed for winter control which better aligns the
budget with the actual spend over the past several years. The increase is mainly in
materials and supplies and relates to sand and salt.
5.4 We have reviewed revenue accounts and adjusted to better reflect what the Municipality
estimates to be achievable. This includes an increase to investment income to better
reflect the interest earned on our investments, but also includes decreases in certain
programs or Planning Department revenues which are anticipated to result in less
revenue than in 2019.
6. Capital Budget Commentary
6.1 The total capital budget investment of $28,672,886 utilizes approximately $7.6 million of
development charges, $4.2 million of new debenture funds, $7.4 million of reserve funds,
$463,979 from reserves and $804,904 from external financing sources (grants). Over
Municipality of Clarington
Report FND-002-20
Page 6
55% of the investment in capital relates to the Engineering and Operations departments
which is in line with the Municipality's asset base (being 55% roads and related).
6.2 Tax levy support in 2020 to the capital budget is $8,294,354 which is $863,711 higher
than the 2019 tax levy support. This is an increase of 11.6% in the tax levy support to the
capital budget. This is achievable through new assessment growth, debt payment
repurposing, and operating cost control being reallocated towards the capital budget.
6.3 The capital budget recommendations are incorporated in the Draft Budget Book, under
the section "Capital Budget" starting on page 132. A description of the project is included
for each capital budget item.
6.4 Federal Gas Tax proceeds have been incorporated into the 2020 Budget in the amount of
$2,791,328. Interest earned in the Reserve Fund due to timing differences in the receipt
of funds versus invoice payments have also been incorporated into the Budget. Formula
based funding under the Ontario Community Infrastructure Fund has been included under
the Engineering section of the budget in the amount of $1,882,464.
6.5 As directed in Resolution #C-204-19, passed on May 21, 2019 giving the Director of
Finance discretion to identify funding for the additional cost of Farewell Creek Trail,
included in the capital budget is $450,000 funded from a combination of levy, grants,
development charges and reserves.
7. Debt Status
7.1 Current projected annual debt repayment obligations for 2020 Budget purposes total
$2,688,395 (2019 - $2,839,715) predominantly funded from development charges.
Existing debentures include those issued for: Bowmanville Indoor Soccer, Garnet B.
Rickard Recreation Complex, Community Care Durham space, Green Road grade
separation, Courtice branch library, the Diane Hamre Recreation Complex, as well as
retrofits for the Municipal Administration Centre and Pad A of the Garnet B. Rickard
Recreation Complex.
7.2 In 2018, two debenture projects were funded internally and will be repaid through
transfers between Reserve Funds. The Garnet B. Rickard Recreation Complex parking
lot refurbishment will be repaid through a portion of the annual contribution to the Parking
Lot Rehabilitation Reserve Fund. The LED light retrofit will be repaid through savings in
electricity and maintenance costs for streetlights.
7.3 There are projected needs for $4.2 million in debentures related to the design and
construction of the South Bowmanville Recreation Centre. The Municipality has
completed grant applications for approximately 75% funding for this project. The timing of
the issuance of the debenture will be dependant on the needs of the Region of Durham.
Municipality of Clarington Page 7
Report FND-002-20
8. Municipal Grant and Sponsorship Programs
8.1 The Municipal Grant program and the Municipal Sponsorship Programs are administered
through the Community Services Department. The Budget presented via this report
includes $60,000 for the municipal grant program and $35,000 for the municipal
sponsorship program. The funds are allocated based on Council direction when the
appropriate reports are brought forward in compliance with the approved policies for the
two programs.
9. Reserve and Reserve Fund Contributions
9.1 Consistent with past practice, increases in reserve and reserve fund contributions are at
times deemed appropriate to bolster balances in depleting reserve funds or to begin to
put aside funds for an identified need. This is an important part of our asset management
strategies. For 2020, there are several increases to the contributions which have been
recommended in the Draft Budget Book (page 181) including:
Facilities/Parks Maintenance Reserve Fund $ 27,000
Community Services Capital Reserve Fund 25,000
Fire Equipment Reserve Fund 25,000
Operations Equipment Reserve Fund 25,500
Community Services Building Refurbishment Reserve Fund 22,500
9.2 An increase to the Pits and Quarries Reserve also occurred; however, it was as a result
of increased royalties that will be received in 2020 and is a direct offset.
10. External Agencies
10.1 The requests from the external agencies, including the Clarington Public Library and
Museums, Visual Arts Centre, Bowmanville Older Adults Association, Community Care
Durham, Newcastle Community Hall, Grandview Children's Centre
Municipality of Clarington
Report FND-002-20
Page 8
10.2 The largest increase relates to the John Howard Society/Firehouse Youth. In 2019 they
were provided $276,731 from the budget; they are requesting a grant of $331,226 which
represents a 19.7% increase of approximately $54,500. This increase relates to the
annualization of costs to provide services to the Newcastle Youth Centre and the Loft
(Courtice Youth Centre).
11. 2020 Accrual Based Budget for PSAB per Ontario Regulation
284/09
11.1 Public Sector Accounting Board annual reporting requirements for municipal Budgets
require that certain accrual -based items be reported to Council in conjunction with the
Budget for 2011 onwards.
11.2 Accrual based expenses that are excluded from the 2019 tax -based budget include post -
employment benefits and amortization of capital assets. Other items to transfer to a
PSAB Budget include tangible capital asset acquisitions and accounting treatment of debt
principal payments.
11.3 There is no immediate financial impact of these PSAB additions or reductions since the
tax -based budget approves necessary funds to provide municipal services for 2019, but
there are longer term implications.
11.4 The estimated change to the accumulated surplus at the end of 2019 resulting from the
above items is as follows:
PSAB Additions to the 2020 Budget
Tangible Capital Asset Amortization
Post -employment Benefit Estimate
Total PSAB Additions
$ 20,093,171
590,000
$ 20,683,171
Municipality of Clarington
Report FND-002-20
PSAB Reductions to the 2020 Budget
Tangible Capital Asset Acquisitions
Debt Principal Payments
Total PSAB Reductions
Total PSAB Impact
(Increase) / Decrease in Accumulated Surplus
12. Council Options
Page 9
$ (28,672,886)
(2,334,033)
$ (31,006,919)
12.1 The Draft Budget Book includes "Items for Council Consideration" starting on page 34.
These items are not part of the proposed budget increase of 1.83%. This list formerly
would have been called the "B list".
12.2 There are 14 items, which would have a total impact of approximately $2.3 million, or
3.93% to the municipal tax levy. Certain projects may be development charge eligible
including the Newcastle Community Park and Newtonville Estates Parkette; however, the
total cost has been included in this list without consideration for use of development
charges.
12.3 Four new firefighters are included on the proposed list as it was recommended through
the Grant Thornton report that the Municipality review staffing levels in Fire Services. A
Fire Masterplan is proposed to be completed in 2020. The Municipality has been putting
aside funds to the Future Staffing Reserve Fund which may be utilized for firefighters or
any other new staffing position. The 2019 contribution of $250,000 has been maintained
for 2020.
Municipality of Clarington
Report FND-002-20
Page 10
12.4 Not included in the list are the impact of inflation which were not captured. For example,
the budget figure for culverts has been relatively maintained; however, the cost of
individual culverts has increased which means that the purchasing power of the
Municipality and the service we can provide has decreased although the budget has
remained the same.
12.5 Also not included in the list is a request from the Royal Canadian Legion for financial
support for their banner program. This request was received after the draft budget was
sent to print. The impact of the $6,500 request is an impact of 0.01 % or $0.16 to the tax
levy.
12.6 Any item from this list which Council wishes to add to the budget, or items not on the list
which Council wishes to add, will be in addition to the 1.83% proposed municipal levy
increase.
13. Concurrence
While concurrence is not applicable, the Department Heads have been consulted on the
2020 Budget and provided input into the draft figures and draft budget book.
14. Conclusion
This report and accompanying documents are intended to provide Council with the
information necessary to make strategic decisions and ultimately adopt a budget for the
2020 fiscal year.
Staff Contact: Trevor Pinn, Director of Finance / Treasurer, 905-623-3379 ext.2602 or
tpinn@clarington.net.
Attachments:
Attachment 1 — Region of Durham 2020 Strategic Property Tax Study
Attachment 2 — 2020 Staffing Memo from the CAO
Interested Parties:
The following interested parties will be notified of Council's decision:
• Community Care Durham
• The Clarington Public Library and Clarington Museums;
• Bowmanville Older Adults Association
• John Howard Society of Durham
• Newcastle Community Hall
• Visual Arts Centre
Attachment 1 to
FND-002-20
If this information is required in an accessible format, please contact 1-800-372-1102 ext. 2304
The Regional Municipality of Durham
Report
To: Finance and Administration Committee
From: Commissioner of Finance
Report: #2020-F-03
Date: February 11. 2020
Subject:
2020 Strategic Property Tax Study
Recommendations:
That the Finance and Administration Committee recommends to Regional Council that:
A) For the 2020 property taxation year, the municipal property tax ratios for the following
property classes for the Regional Municipality of Durham be set as follows and the
requisite by-law be prepared, and approval be granted,
Multi -Residential
1.8665
New Multi -Residential
1.1000
Landfill
1.1000
Pipelines
1.2294
Farmland
0.2000
Managed Forests
0.2500
Commercial Broad Class
(including Shopping Centres, Office Buildings, Parking Lots and Residual)
Occupied 1.4500
Vacant Land 1.4500
Excess Land
1.4500
On Farm
1.4500
Industrial Broad Class
(including Large Industrial and Residual)
Occupied
2.0235
Vacant Land
2.0235
Excess Land
2.0235
On Farm
2.0235
36
Report #2020-F-03
Report:
1. Purpose
Paae 2 of 23
1.1 The annual Strategic Property Tax Study accompanies the Business Plans and
Budgets and provides an update on various property tax issues related to this
significant revenue source. In 2019, budgeted Regional property tax revenue was
$669.1 million or 54.7 per cent of the total $1.225 billion gross expenditures for
Regional property tax supported services.
1.2 The 2020 Strategic Property Tax Study provides information and analyses on
numerous property tax items, including:
• Assessment base trends including growth and the declining non-residential
share which places upward pressure on the residential property tax rates;
• Impacts from the 2016 reassessment phase -in for the 2020 taxation year and
information on the upcoming 2019 reassessment for the property taxation years
2021 to 2024;
• Update on the vacancy policy phase -out (third and final year) for commercial
and industrial properties;
• Update on the current value assessment (CVA) at risk in assessment dispute
processes;
• Review of Durham's municipal tax ratios and comparison to comparable
municipal jurisdictions;
• Comparison of average residential home and non-residential property taxes
across comparable municipalities;
• Heritage property tax rebate matching request from a local municipality; and
• Impact of the Provincial 2020 education property tax rates.
37
Report #2020-F-03 Page 3 of 23
2. The Assessment Base
Weighted Assessment Base Composition Historic Budgetary Growth
Non -Residential 2.0% 6% 1.e%
1.7% 1.6% .
Classes 1a% 1a% 114% 1.7% 1.7%
1.1% 1.2%
Residential
(199#8 2020
Classes
rn o N M v �2 <R n V rn o
O N
O O O O O O ..
O O O O
N N N N N N N N N N N N
Assessment Growth
2.1 Historically, Durham Region's residential growth has been strong relative to the
non-residential growth, contributing to a continual decrease in the proportionate
share of non-residential assessments in the assessment base.
2.2 For 2020, the estimated total weighted assessment growth is 1.95 per cent.
2.3 Continuing Council's direction contained in Report #2018-COW-19, the 0.17 per
cent of the 2020 growth attributed to the Seaton community has been deferred until
Regional departments begin incurring annual operating expenditures related to the
Seaton development.
• This will ensure long term financial sustainability by matching taxable
assessment growth and the related property tax revenue from the Seaton
community with the budgeted Regional operating costs to service this
community.
• This treatment is unique due to the large scale of the Seaton community and the
intense and rapid planned development that will have a measured impact on the
Regional expenditures in the near term.
Non -Residential Share of Regional Assessment and Taxation Base
2.4 Figure 1 shows the significant decline in the non-residential share of the Region's
property tax base since 1998 and the corresponding increase in the residential
share of the tax base.
Figure 1
Share of Regional Property Taxes 1998-2020
21.3% Non -Residential Residential (including MR)
84.>
78.7%
15.3%
CO O N It O CO O N 'IT O 00 O 00 O N I* O CO O N I* tD CO O
a) O O O O O r N O O O O O O r N
O O O O O O O O O O O O O O O O O O O O O O O O
N N N N N N N N N N N r N N N N N N N N N N N
Report #2020-F-03
Paae 4 of 23
2.5 The only exception to the decline in the non-residential share was between 2006-
2012 when non-residential properties experienced a higher valuation increase due
to reassessment. A significant number of these reassessment increases were
partially reversed through Assessment Review Board (ARB) decisions which
contributed to the continued decreasing non-residential share from 2012.
2.6 The decrease in the non-residential share of the Regional taxation base is primarily
the result of declines in the industrial property class share.
Figure 2
Non -Residential Share of Regional Property Taxes 1998-2020
Non -Residential
Commercial
INIndustrial
Or
00 o co 0 00 0
rn o rn o rn o
T_ N � N � N
2.7 The decrease in the non-residential share places upward pressure on the
residential property tax rate and has a direct impact when comparing relative tax
load as discussed in section 7.10 to 7.14 of this report.
2.8 The changes in Regional taxation shares by property class are the result of:
• differences in assessment growth across the property classes;
• different valuation changes across the property classes from reassessments;
• ARB assessment appeal decisions; and
• changes to municipal tax ratios.
39
Report #2020-F-03 Page 5 of 23
3. 2016 CVA Reassessment for Taxation Years 2017 to 2020
Impacts2020 Regional Reassessment Property Taxation
By Property Class
Commercial Industrial
® Broad Broad Regional Regional
0 2% Class Class Average Reassessment
Home Tax Impact
Residential Multi- Farmland 7
Class Residential Class CVA = $483,100
Class 0.3 0
Reassessment Overview
3.1 In 2016, MPAC conducted the provincially mandated reassessment cycle to update
the assessment valuation date (from January 1, 2012 to January 1, 2016). Per
provincial legislation, assessment increases are phased -in uniformly over the
subsequent four-year taxation cycle (2017 to 2020), while assessment decreases
are fully implemented in the first year (2017).
3.2 2020 is the fourth and final year of the four-year phase -in of the 2016 CVA
reassessment. MPAC is currently working on the next reassessment with a
January 1, 2019 valuation date which will be phased -in over the 2021 to 2024
taxation years.
Reassessment Impacts
3.3 Reassessment does not result in a change in the total municipal taxation.
Municipalities do not collect any additional revenues as a result of reassessment
valuation increases.
3.4 Rather, the previous year's municipal tax rates are discounted by the "Taxation
Average" to ensure that the overall reassessment is revenue neutral to
municipalities.
• For the taxation year 2020, the Regional Taxation Average is 6.12 per cent and
the 2019 Regional property tax rates will be discounted accordingly.
3.5 Reassessment does result in shifts amongst individual taxpayers and, as a result,
Regional taxation shifts occur across property classes and across municipalities.
3.6 A property's reassessment impact is calculated as follows:
Property _ Property's CVA Change — Taxation Average
Reassessment —
Impact One +Taxation Average
3.7 There are different taxation averages for each taxation jurisdiction (region/local
municipal and provincial education) as the assessment base for each taxation
jurisdiction is different. The reassessment impacts discussed in this report are for
the Regional taxation portion of the property tax bill only.
all
Report #2020-F-03
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3.8 A property with a CVA increase of 6.12 per cent in 2020 will have no Regional
reassessment taxation impact, as the 2020 Regional taxation average is also 6.12
per cent.
3.9 Figure 3 provides a summary of anticipated Regional taxation shifts that will occur
between property classes as a result of the 2020 reassessment phase -in.
Figure 3
Estimated Regional Property Taxation Shifts Across Property Tax Classes
Property Class
2020
2017-2020
(fourth/final Year of phase
-in)
(full reassessment)
$m
%
$m
%
Residential *
1.06
0.2%
6.95
1.4%
Multi -Residential
0.61
2.2%
2.93
12.2%
Commercial Residual
(0.85)
(1.6%)
(5.08)
(8.9%)
Shopping Centre
(0.14)
(0.6%)
(0.59)
(2.5%)
Office Buildings
(0.07)
(4.2%)
(0.41)
(20.5%)
Parking Lots **
-
1.1%
0.01
5.4%
All Commercial
(1.06)
(1.3%)
(6.07)
(7.3%)
Industrial Residual
(0.37)
(3.2%)
(2.14)
(16.3%)
Large Industrial
(0.26)
(3.8%)
(1.73)
(21.5%)
All Industrial
(0.63)
(3.4%)
(3.87)
(18.3%)
Farmland
0.07
2.5%
0.30
13.1%
Other
(0.05)
(3.1%)
(0.24)
(13.3%)
Total
-
-
I -
-
" The residential class contains multiple property types, including ones that are typically not thought of as being
residential (e.g. gravel pits and golf course greens). This Study uses the average single-family detached home as
the primary residential comparator and its 2020 Regional reassessment impact is estimated at 0.3 per cent, not
the 0.2 per cent estimated for the full residential property tax class shown in the above table.
Due to small size of Parking Lots class, the dollar impact is below the rounding threshold of the table.
3.10 Figure 4 provides a summary of estimated Regional taxation shifts between local
municipalities that occur as a result of the reassessment.
Figure 4
Estimated Regional Property Tax Shifts by Local Municipality
Local Municipality
Pickering
Ajax
Whitby
Oshawa
Clarington
Scugog
Uxbridge
Brock
Total
2020 2017-2020
(fourth/final year of phase -in) (full reassessment)
$m
%
$m
%
0.19
0.2%
1.05
1.0%
0.30
0.3%
1.66
1.5%
0.74
0.5%
3.64
2.7%
0.18
0.1 %
0.62
0.5%
(0.48)
(0.6%)
(2.13)
(2.5%)
(0.35)
(1.4%)
(1.76)
(7.1%)
(0.36)
(1.3%)
(1.99)
(6.8%)
(0.22)
(2.0%)
(1.09)
(9.5%)
41
Report #2020-F-03 Page 7 of 23
Region -Wide Average Home Impact
3.11 The average Region -wide single-family detached home will have a CVA of
$483,100 in 2020 and an estimated 0.3 per cent, or approximately $7 increase in its
Regional property taxes as a result of the reassessment.
3.12 The 2016 reassessment showed a more significant degree of variability and larger
redistributions than previous reassessments. This was especially true for the
single-family detached home which, on average, will experience a 0.3 per cent
increase in 2020 Regional taxes due to reassessment. However, this average does
not convey the large range of impacts across geographical areas. For example, the
average single-family detached home Regional reassessment tax impact ranges
from a high of a 0.9 per cent increase in Whitby to a low of a 2.3 per cent decrease
in Brock.
3.13 The variance in Regional reassessment taxation impact are a direct result of the
variance in the average CVA change of the local specific average home as shown
in the figure 5.
Figure 5
Average Home 2020 CVA Changes due to Reassessment
8.0%
7.0%
6.0%
5.0%
a�
a
0
4.0%
a
Q
■
3.0%
X
Q
O
O (D
U
0—
_
c6 N
0) 'O
m
O
O �
Y
U
d
> N
U Q
D
O)
C31 X N
<
)
Upcoming MPAC Reassessment
3.14 On April 23, 2019, the Province changed the upcoming reassessment date from
January 1, 2020 to January 1, 2019. The accelerated start date will allow MPAC
additional time to consult with stakeholders and improve assessment roll accuracy
with the hope of reducing future assessment disputes.
3.15 It is anticipated the municipalities will be able to analyze and report on the
preliminary results of the reassessment that will impact the taxation years 2021
2024 in the late summer or early fall of 2020.
3.16 The resulting CVA changes from the upcoming reassessment for this reduced
three-year period will still be phased -in over four tax years (2021-2024).
42
Report #2020-F-03 Page 8 of 23
4. Completion of Vacancy Discount Phase -Out and Municipal Tax Ratio
Reduction for the Occupied Industrial Broad Classes
2.260 Lowering the Industrial Municipal Tax Ratio has resulted
2.185 in a 10.5% decrease in municipal taxation over 3 years
2.104
2.024
2017 2018 2019 2020
4.1 After extensive consultation with the public, business community and local
municipalities, Regional Council, as part of the 2018 Strategic Property Tax Study,
approved the phase -out of the two property taxation vacancy policies that were
applicable to both the commercial and industrial broad classes. More specifically:
Regional Council approved a three-year (2018-2020) phase -out of discounts
applied to municipal property taxes on parcels in the vacant and excess land
subclasses within the broad Commercial and Industrial property tax classes.
For the 2020 property taxation year, the discount will be eliminated for both the
Commercial and Industrial broad property tax classes and the vacant and
excess land subclasses within the broad classes will have the same tax rate as
the applicable occupied tax class.
To improve Durham's industrial competitiveness, Regional Council also directed
that any increased municipal property taxation resulting from the phase -out of
the vacant and excess land subclass discounts in the Commercial and Industrial
broad property tax classes be used to fund a phased -in reduction of the
Industrial broad class municipal property taxes through a reduction in the
Industrial broad property tax class occupied municipal tax ratio. Over the three-
year phase -out program, the industrial broad class occupied municipal tax ratio
was reduced by 10.5 per cent assisting in the overall competitiveness of the
Regional property tax structure.
Regional Council also approved a two-year phase -out (2018-2019) of the vacant
unit property tax rebate program available to eligible units in the broad
Commercial and broad Industrial property tax classes. This program was
eliminated in 2019.
4.2 Figure 6 on the following page, provides the estimated impacts of the vacant and
excess land subclasses' discount phase -out and reduction in the industrial broad
class municipal tax ratio.
43
Report #2020-F-03 Page 9 of 23
Figure 6
2020 Estimated Impact on Total Municipal Property Taxes
Resulting from the Vacant Policy Chancres and Industrial Ratio Reduction
$ millions
2020 Estimated 2020 Estimated 2020 Estimated %
Municipal Taxes Change in Change in
(after ratio adjustment & Municipal Taxes Municipal Taxes
with no budgetary increase)
Residential 919.43 0.00 0.0%
Multi -Residential 50.98 0.00 0.0%
Commercial (broad)
Occupied 131.65 0.00 0.0%
Vacant Land 4.43 0.49 11.1 %
Excess Land 1.51 0.17 11.1 %
Commercial Subtotal 137.59 0.66 0.5%
Industrial (broad)
Occupied 26.83 (1.02) (3.8%)
Vacant Land 3.17 0.28 8.9%
Excess Land 0.87 0.08 8.9%
Industrial Subtotal 30.87 (0.66) (2.2%)
Other 7.31 0.00 0.0%
Total 1,146.18 0.00 0.0%
• Vacant properties and excess land parcels in the broad commercial classes will
experience an 11.1 per cent increase in municipal taxes or $0.66 million in 2020.
• Vacant properties and excess land parcels in the broad industrial classes will
experience an 8.9 per cent increase in municipal taxes or $0.36 million in 2020.
• All properties in the broad occupied industrial property classes will experience a
3.8 per cent decrease in municipal taxes or $1.02 million in 2020.
• There is no impact on the occupied commercial, residential, multi -residential or
farmland property taxes classes as a result of this policy changes.
4.3 Due to the significant uptake in the elimination of the municipal tax rate discounts
applied to the vacant and excess land subclasses, the Province recently eliminated
the corresponding reduction on the education taxes province -wide (previously the
Province simply matched a municipal reduction in the discounts).
5. Municipal Property Tax Reduction for "On Farm" Property Class (Farm Value
Added Activities)
5.1 In the 2017 Ontario Economic and Fiscal Review (November, 2017), the Province
announced a policy change that provided "municipalities with the flexibility to tax the
first $50, 000 of assessment on qualifying value added and commercial activities on
farms at a rate that is 75 per cent lower than the commercial or industrial tax rate
that would otherwise follow."
5.2 The provincial regulations (Ont. Regulation 361/18) required to implement this new
flexibility were filed on May 3, 2018. The Province implemented the full reduction
with respect to provincial education taxation in 2018.
Report #2020-F-03
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5.3 MPAC completed the property inspections and issued the revised assessment
notices in the spring of 2019. The 2018 and 2019 Regional property tax strategy
reports deferred the decision whether the Region would adopt the municipal
discount for these new subclasses until MPAC had identified the eligible properties
and an impact analysis could be completed by the Region.
5.4 There are a very limited number of On -Farm class properties in the Region of
Durham. MPAC returned seven properties on the 2020 assessment roll that had
assessment in the On -Farm subclass.
All these properties had CVA in the Commercial On -Farm subclass, while one
property also had CVA in the Industrial On -Farm subclass.
• The seven properties are located in Clarington (4), Brock (2) and Scugog (1).
• The total assessment in the combined On -Farm classes is less than $315,000.
5.5 Should the optional municipal discounted tax rate be adopted, the estimated
taxation shifts from these seven properties is $2,400 for the Regional portion of
property taxes and a total of $1,400 for the three lower tier's portions. Relative to
the size of the taxation bases, the tax shifts are immaterial and would amount to
less than $0.01 for the average Regional home.
5.6 Due to the small number of qualifying properties in Durham Region, the limited
incentive nature in this program and the local municipal administrative burden
associated with adopting the optional municipal tax rate discount, there is little
justification to institute the municipal portion of this program.
5.7 It is possible in the future that the Province may change the parameters of this
program. However, it is not clear that municipalities will have the opportunity to re-
evaluate their participation in an expanded program at that time.
5.8 The program parameters put in place by the Province have the potential to create
an inequity amongst similar properties. For example, a property valued at
$1,000,100 CVA is not eligible for this reduction, while one valued at $999,900 may
be.
5.9 The abrupt application of this threshold or the "cusp" issue make it difficult to justify
municipal involvement in this program as the Region of Durham attempts, as much
as possible, to treat similar properties in a similar manner.
5.10 For these reasons, it is recommended that the Region of Durham not adopt the
municipal property tax rate reduction option for the Commercial and Industrial On -
Farm subclasses at this time. Regional staff discussed this recommendation with
the Area Treasurers in 2019 who raised no objections.
45
Report #2020-F-03 Page 11 of 23
6. Assessment at Risk Update
■ARB ■ RFR 1.07%
0.93% 0.91 % 0.94%
0.82% 0.23%
01 ,
2005CVA 2008CVA 2012CVA 2016CVA 2006 to
3 Years 4 Years 4 Years 3 Years 2019
Based on medium risk scenario.
Assessment Disputes
6.1 At any given point in time, five to ten per cent of the Region's assessment base can
be involved in an assessment or classification dispute. This represents a significant
financial risk to the Region and the Area Municipalities.
6.2 More specifically, the dispute process and the resulting assessment settlements,
which are typically reductions, represent the following three financial risks to the
municipal sector:
• Municipalities are required to rebate the difference between the previously billed
property tax amount based on the original CVA and the revised billing based on
the revised CVA (typically lower). The longer the complaint has been
outstanding, the more years of municipal taxes that are required to be rebated.
• The most material complaints are for non-residential assessment. CVA
reductions on these types of properties further erodes the non-residential
assessment base, shifting taxes to the residential property tax base.
Finally, changes to previous assessment cycles have the potential to put
downward pressure on the current assessment cycle values, which may result in
reduced assessment growth going forward.
6.3 There are two processes by which taxpayers can pursue assessment disputes.
• The first process, which is mandatory for residential properties, is the Request
for Reconsideration (RfR) process. This is an informal process whereby the
property owner requests MPAC review the file and the owner ensures that
MPAC has up-to-date and correct property information. Through this review,
one of the following two outcomes could occur.
o MPAC may offer to revise the returned assessment based on more
current/accurate information or may confirm the returned assessment as
accurate. Should the property owner not agree with the outcome, they have
90 days to file an appeal to the Assessment Review Board (ARB).
o If a change in the assessment is proposed by MPAC, a Minutes of Settlement
Offer would be provided to the owner and, if it is agreed to by the owner, then
the assessment is adjusted. The owner has 90 days to accept the Minutes of
Settlement or move on to the next part of the dispute process (ARB appeal).
Report #2020-F-03
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The second process is an appeal to the ARB, which is an independent
adjudicative body within the Ministry of the Attorney General that decides
assessment and classification complaints in Ontario. It can take several years
for disputes to reach settlement at the ARB, with many of the more complex
commercial and industrial -type complaints resulting in processes that stretch far
beyond the current four-year assessment phase -in period.
6.4 In response to the increased volume of assessment appeals and based on
stakeholder feedback, in 2017 and 2019, the ARB initiated processes to modify its
Rules of Practice and Procedure with the key objective of more timely appeal
resolutions.
6.5 Although the number of dispute claims are fairly evenly split between the RfR
process (52.1 per cent) and the ARB process (47.9 per cent), the total Assessment
at Risk in the ARB process is almost eight times (88.4 per cent) that of the RfR
process (11.6 per cent). Further, the estimated Regional taxation losses over the
period 2006-2019 in the ARB process ($53 million) are almost four times the losses
in the RfR process based on historical analysis ($14 million).
6.6 The next section briefly summarizes the RfR (primarily residential) historical
disputes, and the remainder of this section focuses on the higher risk ARB
(primarily non-residential) disputes.
Request for Reconsideration Process (RfR) Summary
6.7 Figure 7 provides a summary of the estimated Regional taxation losses for the four
CVA cycles over the period 2006 to 2019 including both the losses on resolved RfR
disputes and the estimated losses on the outstanding RfR disputes based on a
medium risk scenario.
Figure 7
Request for Reconsideration (RfR): Estimated 2006-2019
Regional Property Taxation Losses as a Share of Total Regional Taxation
0.303%
0.234%
■ Resolved
Outstanding
0.133%
0.085%
n nmo/.
2005 CVA Cycle 2008 CVA Cycle 2012 CVA Cycle 2016 CVA Cycle
(2006-2008) (2009-2012) (2013-2016) (2017-2019)
0.176%
0.002%
All Cycles
(2006-2019)
6.8 The Regional taxation loss due to the RfR process has continued to decline since
the 2005 CVA cycle as shown above. A review by the Ontario Ombudsman in
2006 resulted in significant changes to the MPAC RfR process which is believed to
have significantly contributed to this decline.
47
Report #2020-F-03
Assessment Review Board (ARB) Disputes
Paae 13 of 23
6.9 The following analysis covers the last four reassessment cycles (2005, 2008, 2012
and 2016) encompassing taxation years 2006 to 2019.
6.10 Figure 8 outlines the assessment at risk for each reassessment cycle. The
significant jump in the assessment at risk in the 2008 CVA cycle was the result of
the economic downturn, as well as large group appeals by owners who had
significant properties across the Province. This was particularly apparent in the
large retail sector. The non-residential disputes are also driven by various
economic factors including the declining manufacturing sector and the changes in
`brick and mortar' retail sector, driven by on-line shopping.
Figure 8
Assessment at Risk in ARB Disputes 2006-2019 ($m)
Withdrawn or CVA Confirmed ■ Resolved Outstanding
$23,513
$12,785
$445 $21,994
$3,988
$20,551
$15,604
$1,498
$3,450
2005 CVA Cycle 2008 CVA Cycle 2012 CVA Cycle 2016 CVA Cycle
(2006-2008) (2009-2012) (2013-2016) (2017-2019)
6.11 The backlog of ARB disputes has decreased over the previous two years, however
there is still a material backlog in the 2012 CVA cycle. The majority of the ARB
appeals for the 2016 CVA cycle are currently in the appeal process and limited
settlements have been reached thus far.
6.12 As illustrated in Figure 9, on the following page, the Regional taxation loss due to
the ARB settled disputes over the four CVA cycles is $34.2 million. It is estimated
that the outstanding ARB disputes will result in additional Regional taxation losses
of $24.9 million under the medium risk scenario (high risk scenario estimate is
$29.3 million; while low risk scenario estimate is $19.9 million).
Report #2020-F-03 Page 14 of 23
Figure 9
ARB Appeals: Estimated 2006-2019: Regional Property Taxation Loss
As a Share of Total Regional Taxation Under a Medium Risk Scenario
■ Resolved Outstanding
0.834% 0.802%
0.520%
0.829%
0.783%
0.770%
0.325%
2005 CVA Cycle 2008 CVA Cycle 2012 CVA Cycle 2016 CVA Cycle All Cycles
(2006-2008) (2009-2012) (2013-2016) (2017-2019) (2006-2019)
6.13 The estimated Regional taxation losses peaked with the 2008 CVA cycle. It is
estimated that the 2016 CVA cycle losses will also be significant due to weakness
in the auto manufacturing sector and the continued erosion of the large retail
sector, as a result of the shift away from brick and mortar stores to on-line
shopping.
6.14 The Region has a property tax appeal reserve to mitigate this risk and to fund
abnormally high rebates of previous year's Regional property taxes. The Region
has also included an additional provision in its annual budgets since 2016 (the
"Adjustment to Assessment Base") to mitigate property taxation shifts from the
reassessment that may be reversed in the appeal process specific to large
properties.
6.15 Region staff, through the review of the assessment at risk, examined the
sustainability of the Region's Property Tax Appeal Reserve including the annual
contribution to this reserve. Based on this analysis, staff is recommending, as part
of the 2020 Property Tax Supported Business Planning and Budget submission, a
$195,000 reduction in the annual contribution to the Property Tax Appeal Reserve.
This reduction results in an annual contribution of $1.0 million to the reserve in the
2020 Budget.
6.16 Although there is much uncertainty with respect to the outstanding ARB disputes, it
is anticipated that the above proposed changes to the current Property Tax Appeals
Reserve is appropriate and will assist in mitigating the impact of these taxation
losses. Regional staff will continue to monitor the assessment appeals.
i•
Report #2020-F-03
Regional Role in Assessment Disputes
Paae 15 of 23
6.17 The Region's 49 per cent share of total property taxation relies on maintenance of
the assessment base and any reduction due to appeals has a direct financial
impact on Regional taxation revenues. The Region has ongoing dialogue with the
local municipalities when feasible.
6.18 As discussed in previous years' studies, the Region's legislative disconnect from
the assessment complaint and appeals process due to lack of upper tier inclusion in
the relevant provincial legislation represents a financial risk. This impacts the
Region's ability to accurately forecast potential financial losses and effectively
monitor and protect the assessment base.
6.19 Regional Council has previously requested that the Province amend the
Assessment Act to provide upper tier municipalities with the appeals rights that are
commensurate with the responsibilities of the upper tier to set property taxation
policy, as well as recognizing the upper tier's higher share of property tax revenues.
To date, no response has been provided or action taken by the Province on this
issue.
General Motors of Canada
6.20 In late December 2019, General Motors Canada (GM) produced the last vehicle
from its Oshawa manufacturing facility.
6.21 GM has begun work on constructing an oval test track for electrical and
autonomous vehicles at the site which will support GM's Canadian Technical
Centre campuses located in Oshawa and Markham. Other activities may have
been informally referenced, but to date have not been confirmed.
6.22 The 2020 CVA on the property has not been adjusted by MPAC to reflect the
change in use of the property. Further, the property is still subject to appeals for all
taxation years subsequent to 2012 (two full assessment cycles).
6.23 Finance staff will continue to work in collaboration with Regional Economic
Development, City of Oshawa, and MPAC staff on this important file. As more
information becomes available, staff will develop more detailed impact analysis and
report back to the Finance and Administration Committee, as appropriate.
7. Inter -Municipal Comparisons
Municipal Tax Ratios
7.1 The calculation of property taxes is based on a property's CVAs as included in the
returned assessment roll provided by MPAC under the authority of the Assessment
Act and the Municipal Act, 2001 where:
• MPAC is responsible for the classification and CVA assignment for all individual
properties in Ontario; and
Municipalities must use MPAC information along with budgetary requirements
and municipal taxation ratios to calculate annual property tax rates applicable to
individual property tax classifications.
50
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7.2 The upper -tier municipality (e.g. Durham Region) in a two -tiered municipal structure
is responsible for property taxation policy decisions related primarily to property
classes and municipal property tax ratios. Local municipalities are legislatively
required to use the upper tier property classes and municipal property tax ratios in
the calculation of local municipal property rates.
7.3 A municipal tax ratio is the degree to which an individual property class is taxed
relative to the Residential class. If the Multi -Residential municipal tax ratio is 1.867,
then its municipal property taxation rate will be 1.867 times that residential class tax
rate. Since municipal tax ratios show the degree to which the non-residential
classes are taxed relative to the residential class, the ratios have a direct impact on
the competitiveness of municipal non-residential property taxes.
Figure 10
2019 Municipal Tax Ratio Comparison
Multi -Residential I Commercial I Industrial Farmland
� Rank � Rank � Rank
Toronto
2.3444
2.7800
1 2.7632
0.2500
Peel Region
(Mississauga)
1.3461
1.5007
1.6266
0.2500
Halton Region
2.0000
1.4565
2.3599
0.2000
York Region
1.0000
1.2794
1.5704
0.2500
Ottawa *
1.3990
1.8576
2.4358
0.2000
Niagara Region
1.9700
1.7349
2.6300
0.2500
Waterloo Region
1.9500
1.9500
1.9500
0.2500
Hamilton **
2.5671
1.9800
3.3696
0.1767
Windsor ***
2.0000
2.0187
2.3200
0.2500
Average
1.8443
1.8008
2.3049
0.2277
Ratios in table have been rounded to three decimal places.
Ottawa has special classes, the broad class ratios are shown
Hamilton has a Large Industrial class with a ratio of 3.951
Windsor has a Large Industrial class with a ratio of 2.938
7.4 As illustrated in Figure 10, Durham Region has a competitive Multi -Residential ratio
of 1.867. Durham's ratio is marginally above the average of the similar municipal
comparators. For a local municipality with a large share of multi -residential
assessment, any reduction in this ratio would shift significant local municipal taxes
to the residential property tax class.
7.5 Durham Region has a competitive commercial ratio of 1.4500. Durham's ratio is 20
per cent below the average of the comparators (1.8008) in the above table.
Durham has the second lowest ratio and is just slightly lower than Halton's ratio of
1.4565. In several instances, municipalities may be raising the municipal tax ratios
to partially offset the inter -class shifting that occurs in a reassessment which is
permitted by the Province in special circumstances.
51
Report #2020-F-03 Page 17 of 23
7.6 Durham Region's 2020 recommended industrial municipal ratio is 12 per cent
below the average of the comparators (2.3049) in the table. Durham is higher than
Mississauga, York Region and Waterloo Region. Of note, there are higher ratios
for the large industrial class in Hamilton and Windsor which are not considered in
this analysis (Durham industrial and large industrial ratios are the same). The
phase -out of the vacancy programs resulted in a 10.5 per cent decrease in
Durham's Industrial broad class ratio over the past three years.
7.7 The Province has mandated a maximum farmland municipal tax ratio of 0.25.
However, several Ontario municipalities (Durham included) have lowered their ratio
from this provincial maximum as a support to the agricultural industry within
Durham.
7.8 The remainder of this section provides a summary of the property tax comparisons
across comparable municipalities adjusting for the varying market values which
then shows the degree to which the market values affect tax rates.
7.9 Caution should be used in interpreting the results of any municipal property tax
comparison.
• These comparisons do not consider municipal services or service levels and a
whole range of other unique municipal characteristics (non-residential
assessment levels, urban/rural compositions, geographical density and size, and
financial sustainability).
As such, these comparisons can be useful in showing the impact the
assessment base has on property tax rates and to garner an overall impression
of general competitiveness, but the results should not in any way be considered
a ranking of municipalities or commentary on municipal efficiency or service
delivery.
Residential Home Property Tax Comparison
7.10 The following residential home property tax comparison is based on the comparison
of 10 "average" homes from across all of Durham's local municipalities. The homes
were chosen to reflect, as closely as possible, that municipality's average home in
terms of assessment, age, size and building quality. MPAC provided the CVAs for
the comparator municipalities on which the following analysis is based.
7.11 As shown, tax rates and assessments vary significantly between municipalities. In
general, they are inversely related (higher assessments allow for a lower tax rate to
generate the same tax dollars).
7.12 The residential home comparison found that the comparable municipalities'
average residential tax rate was 14.4 per cent lower than Durham's. However,
assessment values for the comparators were found to be 25.7 per cent higher. The
resultant average property tax ($) difference between Durham and the comparator's
average is very minor, at approximately 2.3 per cent, as illustrated in Figure 11 on
the following page.
52
Report #2020-F-03 Page 18 of 23
Figure 11
Residential Home Sample Average: Tax Rate, Assessment and Taxation
100.0
85.6
a�
E (D
0
a
E
�Q
U
Tax Rate
rN
100.v
125.7
100.0 97.7
CVA = Taxes
7.13 The majority of the large gap in tax rates can be explained by Durham's much lower
market values (assessments). The gap of 14.4 per cent is reduced to 2.3 per cent
when Durham's lower assessments are considered.
7.14 As noted in section 2.7, the lower non-residential share in Durham Region puts
upwards pressure on the residential to a greater degree than the comparators.
Non -Residential Property Tax Comparisons
7.15 It is difficult to provide a valid non-residential property tax comparison. The primary
issue is the uniqueness of the individual properties and the lack of robust sales
transactions on which MPAC can base the assessments.
7.16 This difficulty has increased over the last few years, as a result of significant
assessment appeals launched by the non-residential sector across Ontario for the
previous two reassessment cycles and the resultant changes (implemented and
anticipated in both specific property assessments and MPAC methodology).
7.17 However, the 2019 municipal ratio analysis clearly showed that Durham's
commercial ratio is very competitive with comparator jurisdictions. As well, it is
believed that municipal taxation is a lessor consideration in a commercial location
decision when compared to factors such as customer density and affluence.
Further, commercial growth within the Region has kept pace with residential growth
over the past two decades.
7.18 Similar to the residential comparison, a commercial comparison based on 18
properties was conducted. As shown in Figure 12 on the following page, tax rates
and assessment vary significantly between municipalities.
53
Report #2020-F-03
Paae 19 of 23
Figure 12
Commercial Sample Average: Tax Rate, Assessment and Taxation
115.5
111.6
100.0 I 100.0 100.0
a�
E
� a
`m E
Tax Rate X CVA = Taxes
7.19 Although the commercial sample showed a high degree of variability, the average
comparator municipal tax rates were 6.2 per cent higher than Durham's, while the
average CVA was also higher by 15.5 per cent. The resultant property tax average
of the comparators is approximately 11.6 per cent higher than in Durham Region.
7.20 An industrial comparison based on 12 properties was also conducted. Again, as
shown in Figure 13, tax rates and assessment vary significantly between
municipalities.
Figure 13
Industrial Sample Average: Tax Rate, Assessment and Taxation
1 A A /`
94.0
a�
a'
a
E
L
p
U
Tax Rate
M
100.0
CVA
125.9
100.0 94.3
= Taxes
7.21 A high degree of variability exists in the sample, however the averages show that
the Durham Region tax rate is 6.0 per cent higher than the comparators', while the
CVA is 25.9 per cent lower. The resultant property tax average on the comparators
is approximately 5.7 per cent lower than Durham Region.
7.22 The relative historical weakness of Durham's industrial property tax
competitiveness is the reason for Council's decision to lower the industrial tax ratio
approximately 10.5 per cent between 2018 and 2020 as highlighted in section 4.0.
As noted previously, property taxation does not appear to be the significant driver in
an industrial business determination of site selection.
54
Report #2020-F-03 Page 20 of 23
8. Heritage Property Tax Rebates
8.1 On November 29, 2019, the Clerk of the Town of Whitby advised the Regional
Clerk that the Council of the Town of Whitby adopted the following resolution (#323-
19) on November 25, 2019.
"That the Region of Durham be requested to support heritage preservation by
adopting a by-law to provide a Regional property tax rebate for designated heritage
properties, including those properties within heritage conservation districts.
8.2 At the December 10, 2019, the correspondence was considered by the Regional
Finance and Administration Committee and referred to staff for consideration in the
2020 Property Tax Study.
8.3 During the 14 years since heritage property tax rebate programs have existed in
certain lower tier municipalities, Regional Finance staff have regularly consulted the
Local Area Treasurers with respect to these programs.
8.4 Historically, Regional Council, in 2006 and 2014, has opted not to adopt a matching
heritage property tax rebate program based on the principle that, as much as
possible, Regional property taxation policy should treat similar properties across the
Region in a similar fashion.
8.5 The legislative authority to grant a heritage rebate comes from Section 365.2 (1) of
the Municipal Act, 2001 which empowers a local municipality to implement a
program of property tax reductions for eligible heritage properties.
8.6 The upper tier municipality is restricted under Section 365.2 (7) to matching an
existing lower tier program and cannot create a rebate program in a local
municipality that does not have an existing program.
8.7 Currently, in the Region, there are three local municipal heritage property tax rebate
programs with different parameters within each program. Below are the estimated
enrollments of the current local programs.
• Ajax 2 properties
• Whitby 30 properties
• Oshawa 8 properties
8.8 For clarity, if Durham Region were to match the existing three local programs, it
would be in a position of providing property tax relief (funded by all Regional
taxpayers) to heritage properties in three municipalities while not being able to
provide similar relief to similar properties in the other five municipalities. Further,
the legislation requires the upper tier to "authorize a similar reduction", so the
Regional rebates in each of the three local tiers could also be different (tied to
heritage program parameters tailored to meet local objectives and therefore, having
unique features as set by the individual local Councils).
8.9 Therefore, in keeping with the Regional objective of treating similar properties in a
similar fashion across its jurisdiction, it is recommended that the Region not match
any of the local municipal heritage property tax rebate programs at this time. Staff
will continue to monitor the evolution of these local programs.
01
Report #2020-F-03 Page 21 of 23
9. Provincial Education Tax Rates
9.1 On January 20, 2020, the 2020 education tax rates were enshrined in Ontario
Regulation 6/20. Figure 14, on the following page, provides the 2020 provincial
education tax rates.
2020 Residential Ontario Education Tax Rates
9.2 The residential and multi -residential education property tax rate will be 0.153 per
cent in 2020, down from 0.161 per cent in 2019. It is estimated that the Average
Region -wide home will experience a 1.1 per cent, or $8 increase in residential
education taxes as a result of the 2020 Ontario education property tax rates.
2020 Commercial Education Tax Rates: Durham Region Rates
9.3 The commercial broad class education tax rate (for shopping centres, office
buildings, parking lots, on -farm and residual) is set at the provincial target rate of
0.98 per cent in 2020, down from 1.03 in 2019 resulting in an average decrease of
approximately 0.7 percent in education taxes for the commercial occupied class.
2020 Industrial Education Tax Rates: Durham Region Rates
9.4 For 2020, the Province lowered the education tax rate for the industrial broad class
in Durham Region to the provincial 2020 uniform ceiling rate of 1.25 per cent (down
from 1.29 per cent in 2019) resulting in an average decrease of approximately 0.9
per cent in education taxes for the industrial occupied class. New construction in
the Industrial broad class receives the lower provincial target property tax rate of
0.98 per cent.
9.5 It is worth noting, that reduction in Provincial education tax rates also reduces the
education revenue retained by the local municipalities on eligible payment -in -lieu
(PIL) properties.
56
Report #2020-F-03
Figure 14
e22of23
2020 Ontario
Education..- Rates
Property Class
Education Tax Rate
Residential
0.00153000
Multi -Residential
0.00153000
J
a
Commercial
Occupied, Vacant & Excess Land
0.00980000
Shopping Centres
Occupied & Excess Land
0.00980000
w
2
Office Buildings
Occupied & Excess Land
0.00980000
Parking Lots (Commercial)
Occupied & Excess Land
0.00980000
o
U
New Construction
Occupied, Vacant & Excess Land
0.00980000
J
g
Industrial
Occupied, Vacant & Excess Land
0.01250000
Large Industrial
Occupied & Excess Land
0.01250000
o
New Construction
Occupied, Vacant & Excess Land
0.00980000
z
Pipelines
0.00980000
Farmland
0.00038250
Commercial On -Farm
0.00245000
Industrial On -Farm
0.00245000
Managed Forests
0.00038250
Farmland Awaiting
0.00114750
Development Phase 1
57
Report #2020-F-03
10. Looking Forward
Paae 23 of 23
10.1 Regional Finance staff will continue monitoring future developments with respect to
the following and report back to Regional Council on:
• the January 1, 2019 valuation date and 2019 CVA reassessment to be phased -
in over the property tax years 2021 to 2024;
• outstanding and future 2016 CVA assessment appeals and related settlements
(for tax years 2017 to 2020) at the ARB;
impacts of General Motors closure of the majority of its auto manufacturing
activities and related facilities in Durham Region and potential reuse of the
properties; and
10.2 An information report is forthcoming to Regional Council to elaborate on issues
surrounding the changing nature of work in the new economy and its potential
impacts on property taxation (primarily non-residential) and municipal revenues.
Respectfully submitted,
Original Signed By
Nancy Taylor, BBA, CPA, CA
Commissioner of Finance
Recommended for Presentation to Committee
Original Signed By
Elaine C. Baxter-Trahair
Chief Administrative Officer
Resolutions from Advisory Committees
Durham Region Roundtable on Climate Change Committee
Letter from the Regional Chair Henry on behalf of the DRRCC to the Members of
Parliament Representing Durham Region Ridings
That we recommend to the Finance and Administration Committee for approval
and subsequent recommendation to Regional Council:
That Regional Chair Henry send the letter with respect to working together to
ensure we can meet our collective goals for climate action, as approved by the
DRRCC at their meeting on January 17, 2020 to the Members of Parliament
representing Durham Region ridings, on behalf of the DRRCC.
59
Attachment 2.1 to FND-002-20
c1Irl
twimgmil Business
Case
If this information is required in an alternate format, please contact the Accessibility
Co-ordinator at 905-623-3379 ext. 2131
Date: October 7, 2019
Subject: Full -Time Municipal Law Enforcement Coordinator
1 Key Issues
With the complexity and volume of management and Municipal Law Enforcement (MLE)
issues in the department, it has become abundantly clear that a single Manager is not
able to properly attend to all the matters in a fashion that meets management's,
Council's, nor the public's expectations and our customer service levels.
2 Desired Outcomes
Ensure that there is enough oversight of the day-to-day operations of managing the
MLE Division as well as addressing the MLE matters which are escalated or assigned
(including staff scheduling, training, and projects such as by-law reviews).
Scope
This applies only to the MLE Division of the Municipal Clerk's Department.
4 Background Including Current Situation, Statistics, and Service
Levels
4.1 The MLE Division
The MLE Division represents the enforcement arm of the Municipality and is a unique
work environment in that it has several levels of employees and includes two work
locations and two collective agreements. The Division is responsible for enforcing over
30 municipal regulatory and licencing by-laws. This includes investigating complaints
and preparing correspondence. Where compliance cannot be achieved, the officers
must prepare and lay charges for violations, assemble and coordinate all material for
court and testify when needed.
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A second major duty of the Division is to review existing by-laws and research and
prepare amendments or repeals of the by-laws as needed. The officers must be
familiar with current provincial legislation and court rulings as they affect municipal
enforcement. When required, the MLE Manager must prepare written reports and
position papers to advise and assist Municipal Council on various matters affecting the
Municipality as a whole.
In addition the Division administers or enforces or works in accordance with certain
Federal and Provincial statutes and regulations, such as the: Canada Evidence Act,
Criminal Code of Canada, Provincial Offences Act, Statutory Powers Procedures Act,
Ontario Building Code Act, Drainage Act, Fire Protection and Prevention Act, Planning
Act, Highway Traffic Act, Dog Owner's Liability Act, Municipal Act, Cannabis Control
Act, Smoke Free Ontario Act, Weed Control Act, Ontario SPCA Act, Municipal Freedom
of Information and Protection of Privacy Act, Occupational Health and Safety Act,
Accessibility for Ontarians with Disabilities Act. This includes the administering of
Provincial protocols in some cases and acting under provincial authority as tribunal
referees for specific legislation.
4.2 Curren, Situation
We are experiencing difficulty in meeting the service levels and customer expectations
of senior management in the MLE Division. There is one full-time MLE Manager
overseeing 18 employees: four full-time MLEO IIs; four full-time MLEO Is; two part-time
MLEO Is; two MLE Clerks, in addition to the Animal Services Manager, the part-time
Animal Services Clerk and two full-time and two part-time Animal Attendants reporting
to the MLE Manager.
The MLE Manager position is responsible for a very high profile business unit (both from
a Council and public perspective) which deals with volatile clientele. These interactions
with the public frequently being negative as matters are escalated to this position.
There is a constant barrage of negativity directed to the MLE Manager.
Aside from the technical knowledge required for the job, the MLE Manager must be
skilled in conflict resolution and mediation with defendants and complainants.
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The MLE Manager position must work in a high pressure environment and:
• Provide Division leadership in carrying out core functions as well as adhering to
corporate strategies.
• Provide strategic direction for enforcement, licensing, and animal sheltering.
• Provide advice to management and Council in the form of reports and memos to
Council.
• Undertake responsibilities in accordance with applicable Provincial legislation
and municipal by-laws, corporate policies, and department procedures.
• Manage staff by setting policies, coordinate/provide training, creating and
approving work schedules.
• Coach and advise officers on current investigations and options for enforcement.
• Supervise staff to ensure implementation and ongoing compliance with policies
and procedures and monitor on -going quality of work and prioritization of
dispatch duties.
• Complete special projects, including regular reviews of regulatory by-laws.
• Adjudication and advocacy by acting as primary appointee for conducting First
Attendance Hearings for parking tickets and as the agent for the Municipality in a
Property Standards Appeal.
• Prepare and administer the annual budget for the Division and create long range
plans and forecasts for staffing.
• Address public complaints regarding MLE services as may be escalated by MLE
Officers and/or Clerical staff.
In order to provide coverage during a prolonged absence by the MLE Manager,
beginning in July, 2019, with the approval of the CAO, we temporarily assigned one of
the senior MLEO Its to the position of MLE Coordinator in order to address MLE
escalations (i.e. addressing public complaints regarding MLE services), supervision and
training of the MLEO Is, manage work schedules as per the collective agreement,
administer First Attendance Hearings for parking infractions, etc. We have extended
this temporary position for six months to overlap with the return of the MLE Manager in
order to allow the Manager to focus on large files/projects, such as the review/update of
the "Vehicle for Hire" by-law and the "Agri -Tourism" framework.
The current MLE Manager has a four week of vacation entitlement.
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4.3 Statistics
Business
Case
There is a correlation between MLE activities and the volume of issues escalated to the
MLE Manager.
Counter Encounters
As a general indicator of MLE activity, we can use counter encounter statistics. Counter
encounters are in -person interactions at the Trulls Road reception counter and they can
include, but are not limited to, the following:
• Parking Complaints
• Parking Tickets
• Parking Permits
• Property Standards
• Snow clearing
• Grass cutting
• Refreshment Vehicle Licensing
• First Attendances
• Sign Licensing
• Fireworks Licensing
• Taxi licensing
• Pet Licensing
The following shows the total number of counter encounters at Trulls Road in recent
years:
Year
# Counter
Comments
Encounters'
2017
10502
2018
1595
2019 (as of September 30th)
1597
Since we are already at 2018
levels, we anticipate a 25%
increase over 2018.
1 From manual Trulls Road counter encounter statistics (i.e. excludes telephone
encounters).
z The values for 2017 are lower because the counter statistics for Trulls Road only
started May 1st, when the MLE Division moved to Trulls Road.
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Parking Tickets
Similarly, increased numbers of parking tickets issued result in an increased number of
first attendances. If a person wishes to dispute a parking ticket, they schedule a first
attendance, which is a meeting with the MLE Manager. These are in person meetings
which are scheduled Tuesdays and Thursdays between 2:00 PM and 4:00 PM and
Wednesdays between 10:00 AM and noon. First attendances are booked in 15 minute
increments.
The following shows the number of parking tickets issued in recent years:
Year
# Tickets Issued3
Comments
2017
8,322
2018
9,753
17% increase over 2017
2019 (as of September 30th)
10,612
Since we are already 8%
over 2018 levels, we
anticipate a 30% increase
over 2018.
The following shows the number of first attendances scheduled in recent years:
Year
# First
Comments
Attendances4
2017
501
2018
631
26% increase over 2017
2019 (as of September 30th)
824
Since we are already 31 %
over 2018 levels, we
anticipate a 45% increase
over 2018.
Municipal On -Street Parking Permits
Even the issuance of municipal on -street parking permits (MOPPs) can indicate greater
activity escalated to the MLE Manager since the purchasing of parking permits often
arises out of escalations to the MLE Manager.
3 Based on Command Centre query of infraction dates.
4 Based on Command Centre query of Court/Scheduled Appointments.
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The following shows the number of permits issued in recent years:
Year
# Permits Issued5
2017
627
2018
927
2019 (as of October 3rd)
985
Online Visitor Parking Passes
In an effort to streamline the process of first attendances, in February, 2017, we
instituted an online visitor parking pass service where a resident could register for up to
seven days of free on -street parking, which should have reduced the number of first
attendances arising out of "one-off instances where the public felt a need to park on the
street".
The following shows the number of days of visitor parking days:
Year
# Visitor Pass Days6
2017
5616
2018
10286
2019 as of September 30th)
10839
However, although the use of the visitor parking passes has increased dramatically, it
has not decreased the number of first attendances.
5 Based on the MOPP excel document — looking at number issued, not the permit
number.
6 Based on Command Centre query of online visitor parking passes — each record is a
separate day.
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Municipal Law Occurrences
Business
Case
The following are the number of municipal by-law occurrences/cases in recent years
showing that, although the percentage of parking complaints may be decreasing, the
volume of LDO complaints as a total are increasing (i.e. we are already at 2018 levels
as of October 3rd):
Year
Total # LDO'
Complaints
(Of Total)
Parking
Complaints Only
Parking
Complaints
as a %
2017
1800
709
39%
2018
2936
792
27%
2019 (as of October 3rd)
2903
689
24%
Formal Complaints
By the very nature of the MLE Division, it is subject to a higher number of formal
complaints than the other divisions. The MLE Manager is very involved in these
complaints and therefore a great deal of time can be devoted to a complaint. The
following is a summary of formal complaints involving the MLE Division in recent years:
Year
# MLE Division
Formal
Complaints$
2016
2
2017
6
2018
8
2019 (as of September 30th)
10
1.4 Service Levels
The Clerk's Department strives for exceptional customer service and works toward
improving it, so much so that in 2017, we identified a need to have the MLE Manager
focus on continuous improvement initiatives.
7 Based on LDO where the occurrence number begins with the corresponding year.
8 These formal complaints may have been just within our complaint procedure and/or
they may have been formal complaints to the Ombudsman.
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As a result, we instituted a Continuous Improvement Plan which identified actions to
support the following key strategies or responsibilities:
1. Ensure timely, consistent cooperation and relevant communication with Council,
internal clients, Department Head, and CAO
2. Ensure timely and consistent communication with external clients
3. Compliance and Enforcement of Municipal By-laws
4. Division Resources
5. Other management activities outside of the Business Plan
See Attachment 1 for details of the work involved to support the above.
The MLE Manager strives to minimize the response time for complaints, as well as
dedicate time to special projects, and oversee the day to day management of a large
and varied team. With only a single senior manager in MLE, it is near impossible to
achieve these tasks within regular work time frames, resulting in missed vacations, and
regular overtime.
Our next steps in our customer service evolution is to implement Key Performance
Indicators (KPIs). However, this requires a dedicated amount of time to implement and
monitor in order to be successful. At this point, the necessary resources are not
available.
5 Alternatives
5.1 Option 1 — Hire a Full -Time MLE Coordinator
This option involves hiring a full-time MLE Coordinator. This person would be
responsible for assisting the MLE Manager in the day-to-day operation of the MLE
Division, and support to the MLE Manager. The position's main focus is to supervise
the MLEO Is (including the development and approval of their work schedules) as well
as be the primary appointee for conducting First Attendance Hearings for Parking
Tickets. This option provides a backup to the MLE Manager during vacation and other
absences. This option would free up the MLE Manager to address escalations from the
MLEO Ils, special projects, and providing proactive strategic direction for the Division.
See Attachment 2 for a draft of the job posting for this new position.
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5.2 Option 2 — Status quo
Business
Case
This option involves leaving things as status quo. We have worked hard to improve the
image and professionalism of the Division and have succeeded in many areas in recent
years. However, without a dedicated professional focussed on the core values and
duties, this is currently not sustainable. As we have experienced in 2019, this is not a
tenable as it is putting too much strain on the current MILE Manager. To remain status
quo, the service levels of returned calls, escalations, special projects, etc. will need to
be modified.
6 Other Considerations (Strategic Plan, Legal, CUPE, Financial,
Environmental, Technological)
There are no issues anticipated from the union as this position is non-affiliated and is
not taking away from affiliated positions.
: inancial Considerations
It is anticipated that the salary of this position would be at a Grade 6 level which, for
2020, is $79,743 to $96,928. See attached draft job posting.
Consultation with Other Departments
Not applicable
8 Recommendation
At this time, therefore, I am recommending that consideration be given to hiring a full-
time MLE Coordinator.
i
C. Anne Greentree
Municipal Clerk
CAG/jg
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Attachment 1
Work that Supports the Continuous Improvement Focus
• Regular updates to front-line staff
• Conducting information sessions with client departments and individual Members
of Council to understand their needs
• Development of policies such as: licensing policy, dispatch and investigation
policy.
• Streamlining of processes
• Managing dispatch data to ensure that it remains current and accurate.
• Conducting regular systematic review of regulatory by-laws through research and
development to provide Council with the necessary background, analysis and
recommendations to enable them to implement positive by-law policy changes.
• Establishing protocols for responding to requests and inquiries from Members of
Council.
• Educate, through consistent, accurate and timely information.
• Establishing and managing dispatch protocols for follow-up communications with
complainants and interested parties.
• Actively communicating enforcement activities.
• Developing and implementing a communication plan.
• Assessing the community needs and engaging residents and stakeholders to
ensure by-law meet objectives and promote a safe and positive image.
• Ensure timely response and dispatch follow up by establishing and managing call
priority protocols and anticipating service demands.
• Establish policies and protocols that provide for enforcement with a focus on
"solving the problem" approach.
• Undertake risk assessments.
• Promote a professional, impartial, courteous and approachable image.
• Provide for continuous training/education.
• Coach and advise officers on current investigations and options for enforcement.
• Establish and manage staffing succession.
Page 10 of 10
Attachment 2 to
FND-002-20
Planning Services Department
Position: Convert Contract Planner I — Special Projects to Full -Time
Additional Compensation: $20,900
The conversion of the existing contract Planner 1 to full-time would improve the ability of
the Planning Services Department to recruit and retain qualified staff in the Special
Projects Branch. The existing contract expires in August. It has been extremely difficult
to hire and retain qualified staff on contract. In the past 3 years, Planning Services has
gone through 8 planners in this contract position which means that just as they are
getting to know and understand the job, they are moving into other positions. It means
that having the time and focus to achieve quality output from these contracts has been a
challenge and will continue to be unless it becomes a full-time position.
The Special Projects Branch serves the other branches on projects such as ZONE
Clarington, leads planning matters relating to heritage, community improvement and
heritage incentive programs, aggregate resources, agriculture, and environmental
stewardship and climate change. In addition, Special Projects currently serves the
Corporation on real estate (recommended to be transferred to Legal as part of the
corporate reorganization), Environmental Assessments by others, environmental
permitting and other environmental study reviews (e.g. the Alternative Fuels proposal
for St. Marys Cement, the Region of Durham's EFW capacity increase and eventual
expansion, and Lake Ontario shoreline management matters). Managing a wide array
of local issues, Special Projects often requires additional research and analysis to
establish a good understanding of the issues. The issues are often complex and
dynamic, many issues are tracked for several years in advance (e.g. anaerobic
digester) to ensure comments on these projects consider the many potential
ramifications for the Municipality as a whole.
It is anticipated that having a full-time Planner 1 in addition to the two positions in the
Development Review branch would allow for cross -branch transitions. Typically, the
Planner 1 s move into other positions having a diversified background dealing with the
many aspects of land use planning would serve the Department and Corporation well.
For the past three years, a Contract Planner 1 has been augmenting the work on Zone
Clarington. We are recommending this become part of the full-time complement.
Many special projects come with some level of funding for consultants (e.g. St.
Marys/EFW air quality expert, Clarington Transformer, Port Granby, EFW EA review,
Darlington New Build EA review). For these assignments, the Special Projects Branch
serves in a project management capacity. To date, there has not been a mechanism to
recover the costs associated with project management for these assignments. With the
precedent set by the Secondary Plans, it could be possible, in the future, to recover
these costs. In addition, Special Projects has handled grants from FCM (Priority Green
and more recently Climate Change). Greater opportunity exists to pursue grant
Attachment 2 to
FN D-002-20
opportunities; however, our ability to do so is limited by existing high priority projects
and workloads. Grant opportunities require staff time to coordinate the grant application
and for project management, reporting and monitoring, if applications are successful.
In addition to specific project work, the Special Projects Branch also often has
community liaison committees or public engagement that continues for years after
projects have been completed / constructed. Currently, Special Projects Branch staff
represent the Municipality on the St. Marys Cement Community Relations Committee,
the Port Granby Discussion Group, the Region of Durham's Energy from Waste
Advisory Committee, and Ministry of Environment, Parks and Conservation required
community liaison committees (Clarington Transformer, EFW-WMAC, Ganaraska
Windfarm). Being able to share these assignments across additional staff would be a
more efficient use of resources. Special Projects is also the liaison for two Council
advisory committees, Heritage and Agricultural, and manage community liaison
committees for the Bowmanville, Newcastle and Orono Community Improvement
Programs.
Over the past three years, the amount of overtime being carried out by the Manager of
Special Projects (although not paid), the Senior Planner and Planner II in Special
Projects has been in excess of approximately 445 hours at time and a half either by
payout or banked lieu time, which can be attributed to workload. The amount of
overtime can be reduced if this new full-time position is created.
Position: Convert Clerk I to Planner II — Community Planning
Additional Compensation: $24,900
The addition of a Planner II to the Community Planning Branch would mean the
workload for Secondary Plans could be more efficiently and effectively carried out. The
Community Planning Branch has 11 Secondary Plans plus 2 Sub -watershed Plans
underway. This workload is a result of the Council adopted policies in OPA 107
allowing a group of landowners to advance timing by funding of a Secondary Plan
preparation.
To meet the demand, a contract Planner II was hired. The contract expires in
December 2020. As noted above, it is very difficult to find and retain contract planners,
especially one with experience at a more senior level. We have the opportunity with the
vacancy of the Clerk I position to make the Planner II full-time thus providing the
incumbent with a greater incentive to remain with the Municipality.
It is anticipated that the Planner II would remain in Community Planning until the
Secondary Plan and Neighbourhood Plan conversions are complete (3-4 years) at
which time we would review whether the position should be repositioned. We would
position the Planner II between branches depending on where the need is greatest.
This has always been a strength of planning where we have a number of employees
cross -trained and able to assist with the workload of any of the branches. Currently all
Planner I and Planner Its answer counter inquiries on a "planner of the day" schedule.
Attachment 2 to
FN D-002-20
The impact on our 2020 budget would be an increase of $24,900 which is the difference
between the Clerk I and Planner II compensation. This conversion is possible as a
direct result of the proposed corporate restructuring. In future years, the remaining
monies to fund this position could be mitigated through increased application revenues
which are anticipated.
Community Services Department
Position: Full -Time Aquatic Programmer
Compensation: $80,800
The Community Services Department is requesting that a Full-time Aquatic Programmer
position be added in the Aquatics area of Recreation Services. This request has been
discussed internally at the Department level for the last few budget years and has not
been brought forward due to competing budget challenges. The last addition of
supervisory staff in this area was in 2007 when a full time Aquatic Programmer position
was created by combining two part-time positions in advance of the opening of the
Newcastle & District Recreation Complex in 2008.
The Manager of Recreation Services oversees the aquatics business unit and the
Aquatic Coordinator is responsible for the day to day operations of the area. The
Coordinator is assisted by one full-time Programmer and one part-time Programmer.
This new position would be located at Diane Hamre Recreation Complex and would
provide a full-time programmer at each of the two largest/busiest pool facilities. The
existing 24-hour position would be relocated to the Alan Strike Aquatic and Squash
Centre which has a smaller aquatic instructional program.
Duties and Responsibilities
The role of the Aquatic Programmer is to provide day to day support to facility, the staff
team and customers. Currently there are three indoor pools and one outdoor pool. The
day to day duties of the position would include:
assist with recruitment, selection & orientation of deck level staff
coordinate ongoing job specific training and skill development
staff supervision, leadership and scheduling
assist with staff evaluation and feedback
assist with program planning, implementation & evaluation
assist in aquatic administrative tasks
respond to customer inquiries and feedback
Attachment 2 to
FN D-002-20
Justification for Consideration in the 2020 ODeratina Budaet
Over the past few years, municipalities across the Province have been experiencing
challenges recruiting, hiring and retaining aquatic staff. Unfortunately, Clarington has
not been immune to this trend.
We are experiencing decreasing staff availability (as a result of increasing academic
expectations and extracurricular activities) resulting in a need to hire, train and
supervise a greater number of staff to meet our current service levels. We currently
employee approximately 100 part-time deck staff and although we do employ head
instructors and head guards, the responsibility for the supervision, management of risk
and quality control of our programs rests primarily at the programmer level.
In addition to the challenges with the quantity of potential staff, we are also experiencing
a decrease in the quality/experience of staff. In a very competitive marketplace,
potential employees are being offered positions in multiple municipalities with many
making their decisions based on schedules and rates of pay. If Clarington is not the
employer of choice for these reasons, and we generally are not, many of the most
qualified/experienced applicants choose to work in other Durham Region municipalities.
Although we do hire Head Guards and Head Instructors with responsibility for on deck
supervision of staff during their shifts, the prime responsibility for the supervision of all
staff rest with the programmers.
Our three indoor swimming pools operate an average of 207 hours per week and the
majority of those hours require significant staff resources to operate. To help illustrate
the growth in aquatics over the years, we have provided a comparison from 2008 to
2018 on some key performance indicators.
Swimming Lessons/Programs — Registered Participants:
2008 5,599
2018 9,894 77% increase
Recreational Swim Visits:
2008 70,122
2018 107,788 54% increase
Annual Aquatic Revenue:
2008 $ 600,419
2018 $1,152,985 92% increase
This is a critical time in Aquatics. The Municipality needs to invest in staff resources in
order to grow and develop leadership programs and to assist in the development of
future aquatic staff. The addition of this position will allow the Community Services
Department to:
Enhance community education around aquatic job opportunities and explore
potential partnerships to recruit candidates into expanded leadership programs.
Create volunteer opportunities to attract and mentor young staff.
Keep pace with the increasing community demand for aquatic programming.
Attachment 2 to
FN D-002-20
In the recent staff report on future facility development in South Bowmanville, we
indicated a concern on the ability to develop adequate resources to properly staff an
additional swimming pool. This challenge coupled with the growth that has occurred in
the aquatic business unit over the past 10 years has resulted in unmanageable
expectations for key staff that is impacting the quality of service we provide our
customers.
If this new FT position is not considered and approved, we will have an urgent need to
create a new 24-hour Part Time Aquatic Programmer position. Based on the data and
justification above this business unit will not be able to sustain the current levels of
service in both the lesson and public swim areas. Additionally, the quality of the service
provided to our customers will also suffer. The current marketplace for aquatic
professionals is very competitive and staff are concerned that even a permanent part
time position may not be able to attract quality candidates, therefore, the priority for staff
is the full-time solution.
Position: Part-time Customer Service Programmer
Compensation: $51,400
This position is needed in order to deal with the increasing demands and growth in this
business unit (see details below), As with the creation of any new business unit, you
are not always sure the original allocation of staffing resources will be adequate in the
long term. This has certainly been the case with Client Services in Community Services
Some justification information below is provided to assist in moving this position forward
for 2020.
Client Services was created in 2018, and since then the Customer Services area has
evolved as a key support to the rest of the Department as it relates to registrations,
facility permitting, POS transactions, transfer and withdrawal support and
administration. As the other areas of the Department (i.e. aquatics, recreation
programs) grow, so does the support provided by the Customer Services team.
ActiveNet is a complex Recreation Leisure Software. During implementation, users had
a basic knowledge of the system. As requirements and knowledge has grown, there is
an identified need to re -build some of the setup of the system based on our business
model. This work requires extensive resourcing to complete. Not only does it involve
changing structures that were originally created, it also requires annual maintenance as
it relates to rates and fees updating.
Over the past few years, municipalities have become increasingly accountable to
compliance with standards and procedures. With the Coordinator currently supporting
the day to day operations, there are a number of key areas that are not receiving the
required attention. With the addition of a Part Time Customer Service Programmer to
assist with the day to day operation, the following will be able to receive more attention
from the Co-Ordinator to bring into compliance:
Cash Handling and cash audits in conjunction with Finance
Attachment 2 to
FND-002-20
Allocation development of standards and training of full-time staff
Structural review of reporting structures, staff portfolios
Evaluation of hours of operation and departmental coordination to ensure CSR
coverage is paired with peaks in the facilities
SOCAN management, reporting and administration
Continued standardized operations of Customer Service desks across locations
Lean evaluation of Customer Service Desk processes to streamline and evolve
efficiencies.
Duties and Responsibilities
The role of the PT Customer Service Programmer is to assist the Coordinator to provide
day to day support to the customer service team. We currently operate customer
service desks in 5 of our larger recreation facilities. The day to day duties of the position
include:
Assist to hire, train and onboard part time Customer Service Staff
Assist with delivery of training and development of Part Time Customer Service
Staff
Assist with the day to day supervision and guidance of PT staff
Assist with the day to day operations of Customer Service Desks, including
merchandise sales at swimming pool facilities
Assist with the submission of content for General Facility Sections General
Information Sections of the Recreation and Leisure Guide
Assist with the creation and maintenance of customer service procedures for the
Customer Service desks
Filling this PT position is also essential to the ability of the Department to take on the
field permitting responsibilities that are recommended to be transferred from the
Operations Department. These responsibilities alone make up the equivalent of 40% of
an FTE. This position could also assist with some of the additional responsibilities if
accessibility and tourism are transferred over to Community Services.
It is a critical time for this section that requires an investment in staff resources in order
to continue to administer the workload increase in the area. As the number of
customers, programs and transactions increase in all other areas, this will continue to
impact the Customer Service team.
These new positions requested by Community Services can be accommodated within
the Department's overall 2% target established by Council.
Attachment 2 to
FND-002-20
Operations Department
Positions: Five Temporary Workers (40 hours a week for two additional months)
Additional Compensation: $42,950 (total for all five positions)
The Operations Department is requesting that the term of employment for five existing
temporary roads labourers be extended from six months to eight months. The
availability of the additional 1,600 hours of work will help to ensure that required service
levels continue to be met or can be potentially expanded. The two additional months of
employment in April and November will include such duties as pothole patching, litter
collection and providing traffic control for ditching operations. Other assigned duties
that have recently become more frequent and could be covered by these additional
hours include responses to beach flooding, roadway washouts and the clean-up of tree
damage on roads from storms. These temporary provide coverage during the summer
months when full-time staff requests for vacation and lieu time are the most
frequent. The two additional months of April and November that are being requested
are becoming more critical to the Operations Department as climate change is causing
increased maintenance and damage to municipal infrastructure.
Position: Clerk II Part-time to Clerk II Full-time
Additional Compensation: $19,600
The Operations Department has requested that one Part-time Clerk II position be
increased to a full-time Clerk II position. The existing Part-time Clerk II is currently
responsible for completing several duties including the processing of ON1 Call locate
requests, maintaining spreadsheets for budgetary and statistical information (salt, sand,
gravel), preparing accounts receivable requisitions, accepting payments and completing
various other clerical services for the Department.
Additional assistance is required from the Clerk II role due to the development of new
internal tracking processes using "Citywide" software and an increase in work order
requests. In 2018, the Operations Department logged 5,529 customer service requests
and in 2019 the number grew to 6,472. For 2020, with the refinement of the existing
Forestry work order process and the addition of new tracking systems for Fleet Services
the number is expected to grow. The development of these new processes will allow
the capture of data necessary to properly track and report on performance metrics.
Other duties that will be assigned to the full-time Clerk II include the administration of
the Seniors Snow Clearing Program and assisting the Administrative Assistant with the
input of timesheets for 56 full-time staff and 36 seasonal staff. The full-time Clerk II role
is integral to the well-being of the frontline administration of the Department by providing
back-up support during very busy periods and at times of employee absence.
Attachment 2 to
FND-002-20
Clerk's De as
Position: Full Time Municipal Law Enforcement Coordinator
Compensation: $117,205
The rationale for this position is set out in a Business Case prepared by the Clerk dated
October 7, 2019 (attached as Attachment 2.1)
This new position can be accommodated within the Department's overall 2% target
established by Council.
Emergency & Fire Services Department
Positions: Four Full -Time Firefighters
Compensation: $318,400 (total for all four positions)
The Fire Chief provided the following background information in support of his request
for these same four positions in the 2019 Budget:
• In 1987, the Municipality began hiring firefighters, progressively staffing Station
(Bowmanville) and Station 4 (Courtice) with day shift firefighters.
• In 1994 an agreement between the Municipality and Ontario Power Generation
required hiring additional firefighters to staff Station 1 24/7 and Station 4 12/7. In
time, Station 4 would also be staffed 24/7.
• With Stations 1 and 4 staffed 24/7, the total number of firefighters was 32.
• In 2003, a formal Fire Master Plan was commissioned highlighting the growth curve
in Clarington, increased residential development and increased calls for service that
impacted the demand on volunteer firefighters. This, along with future growth and
the need to enhance the department's depth of response, illustrated the need for an
increase in staffing with both full-time and volunteer firefighters.
In 2008, a Fire Master Plan update recognized municipal growth influenced by
Holburn Bio-Medical Science Park, Courtice Energy Park, Darlington Nuclear Plant
refurbishment/expansion, the ITER project, Highway 407 expansion and Go Train
expansion through Clarington. The update provided recommendations projected out
to 2021 that included hiring 4 firefighters annually along with the construction and
staffing of an additional fire station in 2019.
Attachment 2 to
FND-002-20
In the fall of 2011, the Association (Local 3139) recommended that Council endorse
a minimum staffing clause of 4 firefighters per fire truck. The Association referred to
several documents and reports including: NFPA 1710- Standard for the Organization
and Deployment of Fire Suppression Operations, Emergency Medical Operations
and Special Operations to the Public by Career Fire Departments, NFPA 1720-
Standard of the Organization and Deployment of Fire Suppression Operations,
Emergency Medical Operations, and Special Operations to the Public by Volunteer
Fire Departments, The NIST Report and Operational Planning: An Official Guide to
Matching Resource Deployment and Risk from the Office of the Fire Marshal.
• Several Reports were provided to Council addressing staffing fire trucks including
ESD 003-11, ESD 004-11 and ESD 006-11.
• In 2011 full-time firefighters staffed Station 1 and Station 4 24/7 with a total of 49
firefighters.
• In February 2014, a full Master Fire Plan was provided to Council. With regards to
Firefighters, the Plan recommended staffing Station 2 (Newcastle) with full-time
firefighters. In 2015, with the rebuild of Station 2 complete, 16 firefighters were
assigned to staff Station 2 24/7.
• As of 2015, Station 1 was staffed with 20 firefighters, Station 4 was staffed with 20
firefighters and Station 2 was staffed with 16 firefighters with the additional 4
firefighters to be hired in 2016. The 2016 hiring of an additional 4 firefighters is
outstanding and has led to the 2019 budget request.
• It should be noted a 2014 analysis by then Deputy Chief Berney, identified that it
takes on average 5.2 firefighters to minimize firefighters' overtime and staff fire
trucks with 4 firefighters after taking into consideration the total of vacation time, lieu
days, sick days used and fire college assignments.
• Hiring an additional 4 firefighters in 2020 would make a total of 60 firefighters
providing 24/7 protection at 3 stations in the following staffing model:
o Station 1 — 1 Platoon Chief and 4 firefighters (5) per platoon
o Station 2 — 1 Captain and 4 Firefighters per platoon
o Station 4 — 1 Captain and 4 Firefighters per platoon
• Along with a minimum staffing practice of 4 firefighters per fire truck, the Department
would only have to rely on volunteer firefighters staffing one truck to secure a depth
of response equal to 16 firefighters enhancing firefighter safety, operational
efficiency and effective Incident Management. It is for this reason I am strongly
urging the additional 4 firefighters.
• The fire department is a composite department, with 25 volunteer firefighters
approved for each station. Volunteer firefighter hiring and retention is becoming
Attachment 2 to
FND-002-20
increasingly more concerning in a community where a majority of the working
population travels for employment limiting both their daytime availability and hours
per day availability. In 2019, we will hire approximately 20 new volunteers to fill
vacancies.
• Council determines the level of fire protection service to be provided. As Fire Chief,
it is my responsibility to interpret the ability of the Department to respond using the
collective response data and report to Council the service level provided and
recommend changes when warranted.
Industry standards suggest when faced with a moderate risk fire (single family,
single storey residential dwelling) a minimum of 16 firefighters is required to arrive
timely, provide an effective search to rescue and suppress a fire safely. Our current
model that relies equally on full-time and volunteer firefighter numbers to staff fire
trucks is not adequate.
The characteristics of Clarington (611 square kilometers, 4 urban areas, several
hamlets and a large rural area) will require the use of volunteer firefighters within
Fire Services for many years. A fire response model that relies on a depth of
response ratio of 3 on -duty full-time fire trucks and 1 fire truck staffed by volunteer
firefighters with a minimum of 16 firefighters responding is required. To achieve this,
hiring 4 additional firefighters is required.
The following additional comments are provided by the Fire Chief in support of this
request in the 2020 Budget:
• What is new and what I would like to bring to Council's attention is the evolving trend
we are seeing with our volunteers. As Council is aware, we are a Composite
Department made up of career and volunteer staff. For years we have relied on
support of the volunteers to run calls in their respective areas, as well as, to run calls
in conjunction with our career staff.
We have seen a change in our volunteer component over the past several years,
however, the impact has reached a point of real concern recently. Typically, we
were replacing an average of 10 volunteers annually, however that number is ever
increasing: 18 new recruits in our last hiring and we anticipate requiring 22 in our
current hiring. This is having a significant impact on our capital and operating costs
with respect to PPE and training.
We are also experiencing a decline in response at certain times of the day. Our
dispatch model dispatches in two ways: calls in volunteer areas are supported with
full-time crews for every call. For calls at our full-time stations, support of our
volunteers is often required to assist with motor vehicle collisions along major
roadways, medical calls and to stand-by supporting a quick response or in the event
of another call. As our calls increase each year, so does the demand on volunteers.
Attachment 2 to
FN D-002-20
We are experiencing a decrease in their ability to meet this demand. Often there are
not enough to respond.
The previous Master Fire Plan done in 2014 suggested increasing our volunteer
numbers at our stations. Times have changed and I believe this recommendation is
no longer practical and will not address current issues: calls have increased and
declining volunteer response rates have become an area of concern especially
during the weekday.
It is also important that I highlight the concern with regards to the opening of the 407.
Its full impact is unknown at this point, but it does need to be factored into decisions
as this may increase call volumes.
As stated in the body of the Grant Thornton Organizational Structure Review Report
dated December 4, 2019, the consultants have recommended (#22) "that an external
review of the fire suppression service delivery model (i.e. the number and composition
of staffing, number of firefighters per truck on calls) be completed".