By Doug Hallett
Guelph Tribune

City hall finance officials are proposing a new 10-year capital budget forecast that increases capital spending in 2013 beyond the levels seen in the past two years. Such a move would put upward pressure on property taxes in Guelph next year.
The proposed capital budget calls for $51.5 million in capital spending in 2013. That’s 20% of the city’s tax revenues in 2012, which is the maximum percentage allowed under the city’s guideline for capital spending.
Approving capital spending at the 20% level – instead of the 19% level used in the 2012 capital budget and the 18% level used in the 2011 budget – would put upward pressure on the city’s 2013 operating budget and on property taxes next year, says a city staff report made public Friday.
A new main library and a south end recreation centre – two of the big projects absent since council retooled its 10-year capital forecast in 2011 – still aren’t included in the latest 10-year, $471-million forecast.
However, the new forecast does include some money to bring both of these projects closer to reality.In the case of the library, it includes money to complete land assembly for a new library, says Al Horsman, the city’s new chief financial officer. So far, two of four needed properties on Wyndham Street North have been acquired by the city.
South end centre
The new 10-year forecast also includes funding for a feasibility study for a long-awaited south end recreation centre.
Horsman said the feasibility study will replace the component study for a south end recreation centre that was delivered to council by a consultant in July 2009.
“It will explore further opportunities and options to make the south end facility budget more shovel-ready,” he told the Tribune.
The component study of 2009, which was done in conjunction with a 10-year strategic master plan for recreation, parks and culture in the whole city, said the price tag of a south end community centre had soared.
At the time, the south end facility was listed in the city’s 10-year capital forecast as a $34.7-million project that was to start construction in 2013 and be opened in 2015. However, the component study found the cost had soared to between $42 million and $51 million, even without factoring in inflation, and that there were potential problems fitting all the recommended components into the site south of Clair Road near Bishop Macdonell high school.
Meeting Wednesday
The new proposed capital budget for 2013 and the new 10-year capital forecast will be discussed at a 7 p.m. city council meeting this Wednesday. However, final approval won’t happen until Dec. 5, when council is scheduled to debate both the operating and capital budgets for 2013.
The proposed capital budget “recognizes the need to continue to be somewhat conservative” about relying on debt financing of capital projects, says a new staff report on the capital budget.
“This recognition has resulted in some notable capital projects that would be debt-financed continuing to be absent from the long-range forecast as staff explore alternative financing opportunities to pay for the city’s share of these projects,” it says. “Opportunities for alternative funding arrangements include grant funding, partnerships, and innovative and new ways of providing these services and facilities.”
Private money
City staff, aided by an international consulting firm, are currently looking at how much public cost could be offset by private money going into a proposed redevelopment of the Baker Street Parking Lot that would include a new library on Wyndham Street North backing onto the parking lot. A detailed business case is to be presented by staff to council by early 2013.
The new 10-year capital forecast calls for additional debt financing for only two projects – land assembly for the new library and the city’s share of the cost of new public health buildings to be built by Wellington-Dufferin-Guelph Public Health in Guelph and Orangeville. The Guelph facility will be built on leased university land east of Stone Road Mall.
Infrastructure and IT
Among other things, the proposed capital budget would “begin to address a massive infrastructure gap that threatens our community’s quality of life,” Horsman says in the budget document.
The capital budget also includes spending on a new information technology strategic plan that was approved in principle by council last week.
“It’s a transformative time” for the Guelph community and for the way city hall operates, Ann Pappert, the city’s chief administrative officer, said in a news release Friday.
“The capital budget would align investments with our 2012-16 strategic plan – a plan that sets a path for the city to be more adaptive and responsive to the needs of a growing, more complex community,” she said. “We’re proposing investments in technology that would help us deliver public services better, and we’re recommending capital investments that would benefit Guelph residents today and in the future.”
Over half of the proposed $51.5-million 2013 capital budget focuses on infrastructure renewal, with $29.1 million earmarked for projects such as facility maintenance, road reconstruction, replacing aging transit vehicles and improving the public drop-off at the city’s Waste Resource Innovation Centre, the release said.
‘City-building’
City staff also propose spending $12.7 million on “city-building” projects, it said. “The Hanlon Creek Business Park would attract new investment and jobs to Guelph, the Eastview Community Park would enhance neighbourhood well-being, and automated waste collection carts and trucks would help reduce the amount of waste Guelph sends to landfill and decrease the city’s carbon footprint.”
Another $9.61 million would be used for more initiatives associated with the city’s 2012-16 strategic plan, the release said. This includes further work on the Baker Street redevelopment project, the South End Community Centre feasibility study, and spending on improved information technology and business systems for city administration.
“Guelph’s responsible financial policies continue to serve us well as we face today’s economic, social and technological realities,” Horsman said in the release. “The investments we make today are designed to ensure Guelph residents and businesses receive the highest quality, most affordable and efficient services from their city government.”
For more details, visit guelph.ca/budget.