Preliminary capital budget presented to council

Lisa
Lisa Goudy
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Councillors listen to the presentation of the proposed 2014-2018 capital budget at the Dec. 16, 2013 council meeting.

Budget proposes $10 million over five years for cast iron water mains

From 2014 to 2018, capital expenses total $120.98 million.

Over 10 years, the City of Moose Jaw has $236.28 million in infrastructure deficit.

The 2014-2018 capital budget and the 10-year unfunded capital budget were presented to council at Monday’s meeting. The estimates were unanimously referred to budget committee for detailed review.

“The capital budget provides for the provision of funds to allow the City of Moose Jaw to undertake major construction, renovation or rehabilitation projects,” said Brian Acker, director of financial services. “Projects that enter into the capital plan are first evaluated and refined by city administration.”

Coun. Brian Swanson said he took issue with the amount of funding allocated for cast iron water main replacement and would advocate for additional funding in budget deliberations.

The water and sewer expenses include $1.87 million in carry forward funding and $1.5 million in 2014 for the east feeder line rehabilitation project. It also includes $10 million for the Buffalo Pound Water Treatment Plant; $18.90 million for the Buffalo Pound pipeline project and $10 million to cast iron water mains over five years.

The budget suggests $2 million per year in city funding for the replacement to total $10 million in five years.

“It looks like a lot of money, but from where I sit, it looks like only about a third of what would be required,” said Swanson. “The trouble is it’s about an $80-million project and, at that funding level, it’s 40 years at best, assuming no increase in budgeted cost.”

City administration is also suggesting a Local Improvement Program (LIP) for cast iron water line replacement beginning in 2015.

“By going to a 50/50 cost shared program it will double the amount of water main that can be replaced and also place part of the cost of replacement on the abutting property owner who will benefit from the replacement,” said the background report on the budget.

Swanson said it’s estimated to cost $1,000 per meter of cast iron water line replacement. With a 50/50 LIP, he said the owner of a 50-foot lot would have to pay $8,300.

“Even if the city were to spread that over, say, seven years in your taxes or water bill, you’re looking at an additional $1,100 or $1,200 a year,” said Swanson. “It’s easy to say that this looks like we could get another $20 million in revenue for the cast iron water lines, but the devil will certainly be in the implementation of that.”

He said there are more than 88 kilometers of cast iron water line in the city and they are long overdue for replacement.

“I believe we have to spend $6 million a year on cast iron water main replacement,” said Swanson. “I will not accept a 40-year timeframe for replacing the cast iron water lines.”

In the capital expenses section of the budget, out of the $120.98 million in capital expenses, $99.19 million is for expense requests.

Those requests include funding for the new hospital, road renewal, cast iron water main replacement, the rehabilitation of the east feeder line, the Buffalo Pound Water Treatment Plant upgrade project and the Buffalo Pound pipeline project, landfill expansion and the CPR dam replacement.

There are also a number of uncompleted works being carried forward for a total of $21.79 million out of the total expenses of $120.98 million.

Those include transportation upgrades, replacement of the CPR dam, multiplex capital upgrades, rehabilitation of the east feeder line, upgrades to the Buffalo Pound Water Treatment Plant and the pipeline project, water and sewer main replacement and upgrades to the wastewater treatment plant.

In the general capital reserve, there is $9.42 million in carry forward for core infrastructure projects. Those include sidewalks, pavement rehabilitation, bridges and building improvements.

The funding for the general reserve are from 10 sources: Saskatchewan Power Corporation Municipal Surcharge (SPC Funds), the hospital levy, taxes, capital expenses fund interest earnings, land sale proceeds, funding from the parks dedication reserve, federal and provincial contributions, building reserve contributions, fundraising contributions, uncompleted works and the Downtown Facility and Fieldhouse (DFFH) capital contribution.

The DFFH does not have a capital request in 2014. As such, there is no offsetting revenue required. As of Nov. 30, the City of Moose Jaw had received $6.32 million of the $10.1 million committed by the Multiplex Builders.

Follow Lisa Goudy on Twitter @lisagoudy.

Sidebar: Surplus and other details of proposed budget

The general capital expenditures in the current five-year capital budget presented to council on Monday have a surplus of $8.8 million. That is because of additional capital revenues of $3.5 million and $3.7 million less in expenses compared to the 2013-2017 capital plan. Council, along with city administration, will need to identify which projects to use the surplus.

“In selecting projects it is important that projects are selected such that work is done in a systematic manner starting with replacement of underground services followed by above ground infrastructure such as paving and sidewalks,” said the report relating to the capital budget.

Public works accounts for approximately $12.70 million of the general capital reserve expenses. Of that, there is $6.59 million for roadway improvements, $3.35 million for bridges and other transportation upgrades and $1.95 million for sidewalks.

There is funding allocated to the CPR Dam in 2014. The project is expected to be tendered in early 2014 and construction finishing by the end of 2014.

The preliminary budget has $1.55 million to repair the Ninth Avenue Bridge. Based on a “detailed bridge evaluation,” the report said that money wouldn’t be needed at the time. It added the Sioux Bridge and the Seventh Avenue Bridge have “passed their service life and need replacement sooner than later.”

However, the five-year capital plan doesn’t address their replacement. There is also no funding for the municipal airport. City administration is instead suggesting an exploration of the “economic opportunities” regarding the airport through a request for proposal to the private sector.

The parks and recreation department has $5.07 million, including $830,000 in park improvements and $1.26 million for building improvements. Upgrades to the city complex are included at a cost of $475,000.

There is $20.15 million in the other services area, including new hospital funding of $7.68 million and $11.57 million in multiplex loan repayments.

- Goudy

 

Organizations: Saskatchewan Power Corporation Municipal Surcharge, SPC Funds, Multiplex Builders

Geographic location: Moose Jaw, Buffalo Pound

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