METRO VANCOUVER REGIONAL DISTRICT PERFORMANCE AND AUDIT COMMITTEE
REGULAR MEETING
Wednesday, May 6, 2020 9:00 a.m. 28th Floor Boardroom, 4730 Kingsway, Burnaby, British Columbia
A G E N D A1
1. ADOPTION OF THE AGENDA
1.1 May 6, 2020 Regular Meeting Agenda That the Performance and Audit Committee adopt the agenda for its regular meeting scheduled for May 6, 2020 as circulated.
2. ADOPTION OF THE MINUTES
2.1 January 22, 2020 Regular Meeting Minutes That the Performance and Audit Committee adopt the minutes of its regular meeting held January 22, 2020 as circulated.
3. DELEGATIONS
4. INVITED PRESENTATIONS
5. REPORTS FROM COMMITTEE OR STAFF
5.1 Metro Vancouver Final Report Designated Speakers: Bill Cox and Brian Szabo, Partners BDO Chartered Accountants That the Performance and Audit Committee receive for information the report dated April 17, 2020, titled “Metro Vancouver Final Report” from BDO Canada LLP Chartered Accountants.
1 Note: Recommendation is shown under each item, where applicable.
April 30, 2020 Performance and Audit Committee Performance and Audit Committee Regular Agenda May 6, 2020 Agenda Page 2 of 3
5.2 Audited 2019 Financial Statements Designated Speaker: Dean Rear a) That the MVRD Board approve the Audited 2019 Consolidated Financial Statements for the Metro Vancouver Regional District; b) That the GVS&DD Board approve the Audited 2019 Financial Statements for the Greater Vancouver Sewerage and Drainage District; c) That the GVWD Board approve the Audited 2019 Financial Statements for the Greater Vancouver Water District; d) That the MVHC Board approve the Audited 2019 Financial Statements for the Metro Vancouver Housing Corporation.
5.3 2019 Financial Results Year-End Designated Speaker: Dean Rear That the MVRD Board receive for information the report dated March 27, 2020, titled “2019 Financial Results Year-End”.
5.4 Semi-Annual Report on GVS&DD Development Cost Charges Designated Speaker: Dean Rear That the Performance and Audit Committee receive for information the report dated April 27, 2020, titled “Semi-Annual Report on GVS&DD Development Cost Charges”.
5.5 Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020 Designated Speaker: Dean Rear That the GVS&DD Board: a) give first, second and third reading to Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020; and b) pass and finally adopt Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020.
5.6 Capital Program Expenditure Update as at December 31, 2019 Designated Speaker: Dean Rear That the Performance and Audit Committee receive for information the report dated March 28, 2020, titled “Capital Program Expenditure Update as at December 31, 2019”.
5.7 Investment Position and Returns – September 1, 2019 to March 31, 2020 Designated Speaker: Dean Rear That the Performance and Audit Committee receive for information the report dated April 19, 2020 titled “Investment Position and Returns – September 1, 2019 to March 31, 2020”.
37074133 Performance and Audit Committee Performance and Audit Committee Regular Agenda May 6, 2020 Agenda Page 3 of 3
5.8 Tender/Contract Award Information – December 2019 to February 2020 Designated Speaker: Roy Moulder That the Performance and Audit Committee receive for information the report dated April 20, 2020 titled “Tender/Contract Award Information – December 2019 to February 2020”.
5.9 Manager’s Report Designated Speaker: Dean Rear That the Performance and Audit Committee receive for information the report dated April 30, 2020, titled “Manager’s Report”.
6. INFORMATION ITEMS
7. OTHER BUSINESS
8. BUSINESS ARISING FROM DELEGATIONS
9. RESOLUTION TO CLOSE MEETING
10. ADJOURNMENT/CONCLUSION That the Performance and Audit Committee adjourn/conclude its regular meeting of May 6, 2020.
Membership:
Dhaliwal, Sav (C) - Burnaby Harvie, George - Delta Walker, Darryl - White Rock Brodie, Malcolm (VC) - Richmond Marsden, Dennis - Coquitlam West, Brad - Port Coquitlam Dingwall, Bill - Pitt Meadows Morden, Mike - Maple Ridge Dominato, Lisa - Vancouver Nagra, Mandeep - City of Surrey
37074133 Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT PERFORMANCE AND AUDIT COMMITTEE
Minutes of the Regular Meeting of the Metro Vancouver Regional District (MVRD) Performance and Audit Committee held at 9:03 a.m. on Wednesday, January 22, 2020 in the 28th Floor Committee Room, 4730 Kingsway, Burnaby, British Columbia.
MEMBERS PRESENT: Chair, Councillor Sav Dhaliwal, Burnaby Vice Chair, Mayor Malcolm Brodie, Richmond Mayor Bill Dingwall, White Rock Councillor Dennis Marsden, Coquitlam Mayor Mike Morden, Maple Ridge Councillor Mandeep Nagra, Surrey Mayor Darryl Walker, White Rock Mayor Brad West, Port Coquitlam (arrived at 9:24 a.m.)
MEMBERS ABSENT: Councillor Lisa Dominato, Vancouver Mayor George Harvie, Delta
STAFF PRESENT: Dean Rear, Chief Financial Officer Jerry Dobrovolny, Chief Administrative Officer Janis Knaupp, Legislative Services Coordinator, Board and Information Services
1. ADOPTION OF THE AGENDA
1.1 January 22, 2020 Regular Meeting Agenda
It was MOVED and SECONDED That the Performance and Audit Committee adopt the agenda for its regular meeting scheduled for January 22, 2020 as circulated. CARRIED
2. ADOPTION OF THE MINUTES
2.1 October 10, 2019 Regular Meeting Minutes
It was MOVED and SECONDED That the Performance and Audit Committee adopt the minutes of its regular meeting held October 10, 2019 as circulated. CARRIED
Minutes of the Regular Meeting of the MVRD Performance and Audit Committee held on Wednesday, January 22, 2020 Page 1 of 5 Performance and Audit Committee 3. DELEGATIONS No items presented.
4. INVITED PRESENTATIONS No items presented.
5. REPORTS FROM COMMITTEE OR STAFF
5.1 MVRD Audit Plan from BDO Canada LLP Report dated December 20, 2019 from Dean Rear, General Manager, Financial Services/Chief Financial Officer, providing members with the external auditor’s plan for completing the annual external audit for Metro Vancouver Districts and Housing Corporation fiscal year 2019.
Bill Cox and Brian Szabo, BDO Canada LLP, provided members with an overview of the MVRD Audit Planning Report. Members were informed that the 2019 audited financial statements will be presented to the Performance and Audit Committee at its April 8, 2020 meeting.
In response to questions, members were informed about how accounting entries are reviewed, the work being done on asset retirement obligations which may result in a non-funded liability with no dedicated reserve, and about staff efforts to collaborate with BC local governments to share best practices on and ensure a consistent approach to asset obligation accounting.
It was MOVED and SECONDED That the Performance and Audit Committee receive for information the report dated December 20, 2019, titled “MVRD Audit Planning from BDO Canada LLP”. CARRIED
5.2 2020 Performance and Audit Committee Priorities and Work Plan Report dated December 10, 2019 from Dean Rear, General Manager, Financial Services/Chief Financial Officer, providing members with the 2020 Performance and Audit Committee Work Plan and priorities.
Members were informed that staff will also explore investment policy and procurement trends, as part of 2020 Work Plan efforts.
9:24 a.m. Mayor West arrived at the meeting.
It was MOVED and SECONDED That the Performance and Audit Committee: a) endorse the work plan as presented in the report dated December 10, 2019 titled “2020 Performance and Audit Committee Priorities and Work Plan”; and
Minutes of the Regular Meeting of the MVRD Performance and Audit Committee held on Wednesday, January 22, 2020 Page 2 of 5 Performance and Audit Committee b) receive for information the Performance and Audit Committee Terms of Reference as attached to the report dated December 10, 2019 titled “2020 Performance and Audit Committee Priorities and Work Plan”. CARRIED
5.3 Bowen Island Municipality – Metro Vancouver Regional District Security Issuing Bylaw No. 1298, 2020 Report dated December 17, 2019 from Dean Rear, General Manager, Financial Services/Chief Financial Officer, seeking MVRD Board adoption of Metro Vancouver Regional District Security Issuing Bylaw No. 1298, 2020, to authorize a borrowing request from Bowen Island Municipality in the amount of $2,533,000 for the Spring 2020 MFA long-term debt issue for construction and improvements to water infrastructure and the Cove Bay Water Treatment Plant.
It was MOVED and SECONDED That the MVRD Board: a) pursuant to Sections 182(1)(b) and 182(2)(a) of the Community Charter, give consent to the request for financing from Bowen Island Municipality in the amount of $2,533,000; b) give first, second and third reading to Metro Vancouver Regional District Security Issuing Bylaw No. 1298, 2020 being a bylaw to authorize the entering into an Agreement respecting financing between the Metro Vancouver Regional District and the Municipal Finance Authority of British Columbia; c) pass and finally adopt Metro Vancouver Regional District Security Issuing Bylaw No. 1298, 2020; and d) forward Metro Vancouver Regional District Security Issuing Bylaw No. 1298, 2020 to the Inspector of Municipalities for Certificate of Approval. CARRIED
5.4 Village of Lions Bay - Metro Vancouver Regional District Security Issuing Bylaw No. 1299, 2020 Report dated December 17, 2019 from Dean Rear, General Manager, Financial Services/Chief Financial Officer, seeking MVRD Board adoption of Metro Vancouver Regional District Security Issuing Bylaw No. 1299, 2020, authorizing a borrowing request from the Village of Lions Bay in the amount of $600,000 for the Spring 2020 MFA long-term debt issue for construction and improvements to water infrastructure.
It was MOVED and SECONDED That the MVRD Board: a) pursuant to Sections 182(1)(b) and 182(2)(a) of the Community Charter, give consent to the request for financing from the Village of Lions Bay in the amount of $600,000; b) give first, second and third reading to Metro Vancouver Regional District Security Issuing Bylaw No. 1299, 2020 being a bylaw to authorize the entering
Minutes of the Regular Meeting of the MVRD Performance and Audit Committee held on Wednesday, January 22, 2020 Page 3 of 5 Performance and Audit Committee into an Agreement respecting financing between the Metro Vancouver Regional District and the Municipal Finance Authority of British Columbia; c) pass and finally adopt Metro Vancouver Regional District Security Issuing Bylaw No. 1299, 2020; and d) forward Metro Vancouver Regional District Security Issuing Bylaw No. 1299, 2020 to the Inspector of Municipalities for Certificate of Approval. CARRIED
5.5 Tender/Contract Award Information – September 2019 to November 2019 Report dated December 16, 2019 from Roy Moulder, Director, Purchasing and Risk Management, Financial Services, providing members with information on contracts handled through the Purchasing and Risk Management division with a total anticipated value at or in excess of $500,000 (exclusive of taxes).
In response to questions, members were informed about: staff efforts and responses when a single contract bid is received through the Request for Proposal process to ensure the process remains competitive the rationale for the amended change order for the Annacis Island Waste Water Treatment Plant Supply and Delivery of Cogeneration System Project
Members were informed that as part of 2020 Work Plan efforts staff will report back, as directed by the Board, with a review of and options for Metro Vancouver’s project delivery management process.
It was MOVED and SECONDED That the Performance and Audit Committee receive for information the report dated December 16, 2019 titled “Tender/Contract Award Information – September 2019 to November 2019”. CARRIED
5.6 Manager’s Report Report dated December 23, 2019 from Dean Rear, General Manager, Financial Services/Chief Financial Officer, highlighting the upcoming Municipal Finance Authority Annual General Meeting and Financial Forum, Bank of Canada key interest rates, and merger of Westminster Credit Union and Prospera Credit Union.
Members discussed the need for new local government investment tools and Municipal Finance Authority (MFA) efforts to develop these tools to be announced following the March 2020 MFA Annual General Meeting.
It was MOVED and SECONDED That the Performance and Audit Committee receive for information the report dated December 23, 2019, titled “Manager’s Report”. CARRIED
Minutes of the Regular Meeting of the MVRD Performance and Audit Committee held on Wednesday, January 22, 2020 Page 4 of 5 Performance and Audit Committee 6. INFORMATION ITEMS No items presented.
7. OTHER BUSINESS No items presented.
8. BUSINESS ARISING FROM DELEGATIONS No items presented.
9. RESOLUTION TO CLOSE MEETING
It was MOVED and SECONDED That the Performance and Audit Committee close its regular meeting scheduled for January 22, 2020 pursuant to the Community Charter provisions, Section 90 (1) (d) as follows: “90 (1) A part of the meeting may be closed to the public if the subject matter being considered relates to or is one or more of the following: (d) the security of the property of the regional district.” CARRIED
10. ADJOURNMENT/CONCLUSION
It was MOVED and SECONDED That the Performance and Audit Committee adjourn its regular meeting of January 22, 2020. CARRIED (Time: 9:46 a.m.)
______Janis Knaupp, Sav Dhaliwal, Chair Legislative Services Coordinator
36596688 FINAL
Minutes of the Regular Meeting of the MVRD Performance and Audit Committee held on Wednesday, January 22, 2020 Page 5 of 5 Performance and Audit Committee
5.1
To: Performance and Audit Committee
From: Dean Rear, Chief Financial Officer
Date: April 17, 2020 Meeting Date: May 6, 2020
Subject: Metro Vancouver Final Report
RECOMMENDATION That the Performance and Audit Committee receive for information the report dated April 17, 2020, titled “Metro Vancouver Final Report” from BDO Canada LLP Chartered Accountants.
EXECUTIVE SUMMARY Under provincial legislation, an external audit must be undertaken annually for all Metro Vancouver Districts’ and the Housing Corporation. The attached report, prepared by Metro Vancouver’s external auditors, BDO Canada LLP Chartered Accountants, summarizes the results of the annual audit for fiscal year 2019.
PURPOSE To provide the committee with our external auditor’s final report related to the annual audit for the Metro Vancouver Districts’ and Housing Corporation for fiscal year 2019.
BACKGROUND It is required, under provincial legislation, that an external audit be undertaken annually for all Metro Vancouver Districts’ and the Housing Corporation. This audit must be conducted by a public accounting firm that is licensed to conduct such audits. The attached report summarizes the results of the annual audit for fiscal year 2019.
BDO Canada LLP Chartered Accountants were appointed by the Board in July 2019 as our external auditors for a five-year period. Fiscal year 2019 is the first year of that five-year period.
ALTERNATIVES This is an information report, no alternatives are presented.
FINANCIAL IMPLICATIONS The annual audit fulfills our statutory responsibility.
CONCLUSION As prepared by BDO Canada LLP Chartered Accountants, our external auditors, the final report for the 2019 external audit of the Metro Vancouver District’s and Housing Corporation is presented to the committee for information.
Attachments: 1. Metro Vancouver Final Report
37083208
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT
FINAL REPORT TO THE PERFORMANCE AND AUDIT COMMITTEE ForMETRO the year ended VANCOUVER December 31, 2019 REGIONAL DISTRICT Dated April 17, 2020 for presentation on May 6, 2020 METRO VANCOUVER REGIONAL DISTRICT April 17, 2020
METRO VANCOUVER REGIONAL DISTRICT April 17, 2020
BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. Performance and Audit Committee AUDIT FINAL REPORT TO THE PERFORMANCE AND AUDIT COMMITTEE Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
April 17, 2020 Members of the Performance and Audit Committee Metro Vancouver Regional District 4730 Kingsway Burnaby, BC V5H 0C6
Dear Performance and Audit Committee Members:
We are pleased to present this report on the results of our audit of the consolidated financial statements of Metro Vancouver Regional District, Greater Vancouver Sewerage and Draining District (“GVSDD”), Greater Vancouver Water District (“GVWD”), and Metro Vancouver Housing Corporation (“MVHC”) (together referred to as the “District”) for the year ended December 31, 2019. The purpose of this report is to summarize certain aspects of the audit that we believe to be of interest to the Performance and Audit Committee (the “Committee”) and should be read in conjunction with our planning report to the Committee dated December 20, 2019, 2020 and the draft consolidated financial statements to which our draft auditor’s report is attached.
We would like to bring to your attention that our audit and therefore this report will not necessarily identify all matters that may be of interest to the Performance and Audit Committee in fulfilling its responsibilities.
This report has been prepared solely for the use of the Performance and Audit Committee and should not be distributed without our prior consent. Consequently, we accept no responsibility to any third party that uses this communication.
We wish to express our sincere appreciation for the co-operation we received during the audit from Metro Vancouver Regional District’s management and staff who have assisted us in carrying out our work. We look forward to connecting with you to discuss the contents of this report and any other matters that you consider appropriate.
Yours truly,
Brian Szabo, CPA, CA Bill Cox, FCPA, FCA Partner through a corporation Partner through a corporation BDO Canada LLP BDO Canada LLP Chartered Professional Accountants Chartered Professional Accountants
1 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
TABLE OF CONTENTS
SUMMARY ...... 3 AUDIT FINDINGS ...... 6 INTERNAL CONTROL MATTERS ...... 11 OTHER REQUIRED COMMUNICATIONS ...... 13 APPENDIX A: ADJUSTED AND UNADJUSTED DIFFERENCES ...... 15 APPENDIX B: REPRESENTATION LETTER ...... 18 APPENDIX C: MANAGEMENT LETTER ...... 21
2 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
SUMMARY
Status of the Audit Materiality
As communicated to you in our Planning Report to the Performance and As of the date of this report, we have substantially completed our audit of Audit Committee, preliminary materiality was as follows. Final materiality the 2019 consolidated financial statements, subject to completion of the remained unchanged from our preliminary assessment. following items:
Receipt of signed management representation letter Entity MATERIALITY Subsequent events review through to financial statement approval date MVRD (Consolidated) 16,900,000 Approval of consolidated financial statements by those charged with MVRD (Non-consolidated) 15,200,000 governance. GVSDD 12,700,000 We conducted our audit in accordance with Canadian generally accepted GVWD 12,700,000 auditing standards. The objective of our audit was to obtain reasonable, MVHC 1,700,000 not absolute, assurance about whether the consolidated financial statements are free from material misstatement. Our draft independent auditor’s report is attached to the consolidated financial statements. For our audit work over tangible capital assets (“TCA”) and other assets Except as described in this report, the scope of the work performed was and liabilities related to TCA, we set a higher materiality based on the net substantially the same as that described in our Planning Report to the book value of TCA. This is to recognize the fact that the Districts have a Performance and Audit Committee dated December 20, 2019. significant value of TCA which is much larger in comparison to its operating activities. With respect to the Annual Report, we review this document to ensure that there are no inconsistencies with the consolidated financial statements and that the information is consistent with our knowledge of the District. We are not responsible for, nor did we review the Annual Report to determine if the information was complete or sufficient for the readers, if factors were omitted or if the disclosures were adequate.
3 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Audit Findings Internal Control Matters
Our audit focused on the risks specific to your operations and key accounts. We are required to report to you in writing, any significant deficiencies in Our discussion points below focus on key areas of audit focus: internal control that we have identified. There were no control deficiencies noted that, in our opinion, are of Management override of internal controls significant importance to discuss with those charged with governance. Grant and revenue recognition However, please refer to Appendix D for the management letter which Consolidation outlines recommendations over areas of operational improvement. Landfill closure and post closure costs
Sale of Metrotown Place I and III Employee future benefits Independence Staff compensation Our annual letter confirming our independence is provided in Appendix B. Tangible capital assets and accumulated amortization We confirm that we are still independent as of the date of this letter. Subsequent events related to COVID-19
4 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Adjusted and Unadjusted Differences Significant Audit Estimates We have disclosed all adjusted and unadjusted differences greater than 5% of materiality, as well as all material disclosure omissions identified Management is responsible for determining Metro Vancouver Regional through the course of our audit engagement. Each of these items has been discussed with management. District’s significant accounting policies. The choice between accounting policy alternatives can have a significant effect on the financial position Management has determined that the unadjusted differences are and results of the organization. The application of those policies often immaterial both individually and in aggregate to the consolidated financial statements taken as a whole. Should the Performance and involves significant estimates and judgments by management. Based on Audit Committee agree with this assessment, we do not propose further the audit work that we have performed, it is our opinion that the adjustments. accounting policies and estimates in the consolidated financial For purposes of our discussion, a summary of adjusted and unadjusted statements are reasonable and the disclosures relating to accounting differences and disclosure omissions has been presented in Appendix B. estimates are in accordance with Canadian public sector accounting standards.
Management Representations
During the course of our audit, management made certain Fraud Discussion representations to us. These representations were verbal or written and therefore explicit, or they were implied through the consolidated Through our planning process, and current and prior years’ audits, we financial statements. Management provided representations in response have developed an understanding of your oversight processes. We are not currently aware of any fraud affecting the entity, other than items to specific queries from us, as well as unsolicited representations. Such previously reported or discussed. representations were part of the evidence gathered by us to be able to draw reasonable conclusions on which to base our audit opinion. These If you are aware of changes to processes or are aware of any instances of actual, suspected or alleged fraud affecting the District since our representations were documented by including them in the audit discussions held at planning, we request that you provide us with this working papers, memoranda of discussions with management and information. written representations received from management. Please refer to the Auditor’s Responsibilities for Detecting Fraud in the Planning Report to the Performance and Audit Committee. A summary of the written representations we have requested from management is set out in the draft management representation letter included in Appendix C to the report.
5 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
AUDIT FINDINGS
As part of our ongoing communications with you, we are required to have a discussion on our views about significant qualitative aspects of the District's accounting practices, including accounting policies, accounting estimates and financial statement disclosures. In order to have a frank and open discussion, these matters can also be discussed verbally with you. A summary of the key discussion points are as follows:
KEY AUDIT AREAS
As described in our Planning Report to the Performance and Audit Committee, the following key audit areas were identified based on our knowledge of the Metro Vancouver Regional District’s operations, our past experience, and knowledge gained from management and the Performance and Audit Committee.
Management Override of Internal Controls
Key Audit Area Approach Results
Management is in a unique position to We reviewed transactions recorded in the various All audit testing in this area was executed as planned with perpetrate fraud because of the ledgers for unusual or non-recurring adjustments no issues to be reported. ability to directly or indirectly not addressed by other audit procedures. manipulate accounting records, and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively.
Note this risk is applicable for all audits and is not specific to the District.
6 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Grant and Revenue Recognition
Key Audit Area Approach Results
Accounting standards are complex and Grant funding received was confirmed through a We noted GVSDD recorded $7.4M in grant revenue in the subject to variation in application. review of agreements, which ensures that the current year related to interest on unspent funds There is a risk that revenue may be amounts recorded existed. We also ensured the received from the date of receipt of the funding up to incorrectly deferred into future revenue was recorded accurately in accordance December 31, 2018. This amount was previously periods or recognized prematurely. with the settlement of any stipulations. recorded as deferred grant revenue. In addition, we noted GVSDD also recorded $5.1M in grant revenue in Other revenue streams also contain revenue the current year related to amounts spent in the prior recognition issues which will were reviewed in year. We have included an unadjusted audit difference accordance with latest revenue recognition related to the opening accumulated surplus of these standards. prior year amounts as well as a classification adjustment between interest and grant revenues.
All other audit testing in this area was executed as planned with no issues to be reported.
7 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Consolidation
Key Audit Area Approach Results
We were engaged to perform separate audits of All audit procedures in this area were executed as The District’s consolidated financial the Greater Vancouver Sewer & Drainage District, planned with no issues to be reported. statements are made up of the Greater Vancouver Water District and Metro balances and transactions of the Vancouver Housing Corporation. Regional District, Greater Vancouver
Sewer and Drainage District, Greater We have reviewed management’s consolidation Vancouver Water District and Metro process and ensure consolidation entries are Vancouver Housing Corporation. appropriate and accurately recorded and that all
inter-entity transactions and balances are Accounting standards requires the eliminated for purposes of the consolidated elimination of inter-entity financial statements. transactions and balances upon
consolidation. We reviewed the disclosure of the basis of consolidation in the notes to the financial statements.
Landfill Closure and Post Closure Costs
Key Audit Area Approach Results
Due to the complexity of this We evaluated key inputs used in the estimation of All audit testing in this area was executed as planned with standard, there is a risk that liabilities the landfill closure and post closure liability based no issues to be reported. may not be identified or appropriately on models created by external engineers in 2018 estimated and updated by the City of Vancouver and management in the current year.
We reviewed calculations and disclosure prepared by management and management’s experts.
8 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
For the Cache Creek post-closure liability which is entirely funded by investments held in a post- closure fund, we confirmed the monies held in trust by the Province.
Sale of Metrotown Place I and III
Key Audit Area Approach Results
We reviewed the sales agreement to determine the The sale of Metrotown Place I and III All audit testing in this area was executed as planned with appropriateness of management’s accounting was completed in March 2019. no issues to be reported. treatment.
We reviewed the calculation of gain on sale and related disclosure in the notes to the financial statements to ensure the transaction was appropriately accounted for and disclosed.
Employee Future Benefits
Key Audit Area Approach Results
We read actuarial reports and audited the All audit testing in this area was executed as planned with A complex area that requires significant assumptions. no issues to be reported. significant estimation and use of the
work of actuarial experts to ensure We directly communicated with the independent the completeness and accuracy of the actuaries. We audited the underlying data liability for future benefits which are provided to the actuary for accuracy and incurred over time and paid in the completeness. future.
We verified the appropriateness of financial statement disclosure.
9 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Staff Compensation
Key Audit Area Approach Results
We performed tests of design, implementation All audit testing in this area was executed as planned with A significant expenditure category and effectiveness of controls. no issues to be reported. that covers many employees and We performed substantive analytical procedures departments. As a public body, this over total staff salaries and benefits. figure is often of particular interest to
financial statement users (taxpayers). We reviewed the consistency and appropriateness of the allocations of staff costs from Metro Vancouver Regional District to the other Districts and to MVHC.
Tangible Capital Assets and Accumulated Amortization
Key Audit Area Approach Results
We performed tests of controls over appropriate The Districts and MVHC have All audit testing in this area was executed as planned with authorization of purchases combined with significant capital investments. The no issues to be reported. substantive testing of additions and disposals in the valuation and useful lives of these year. We performed substantive analytical assets involve a high level of procedures over amortization expense. estimation and coordination of the
finance department with other We considered impairment for existing assets that departments. are being replaced by new capital projects.
We reviewed actual useful life of assets for purposes of amortization.
10 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Subsequent events related to COVID-19
Key Audit Area Approach Results
Discussed with management the impact to date of Subsequent to the year end, the Management has included a note to the financial COVID-19. effects of COVID-19 on the global and statements that outlines the uncertainties caused by
local economies became increasingly COVID-19 subsequent to year-end. At this time it is too Considered observable impacts on the economy severe. This has created uncertainty soon to determine what, if any, impacts on specific and other public sectors organizations. in the future operations, revenue financial statement items may occur.
sources and expenditures of all public We considered specific financial statement sector organizations. We agree with management’s approach to disclosing the amounts that may be susceptible to COVID-19 uncertainties. impacts.
11 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
INTERNAL CONTROL MATTERS
During the course of our audit, we performed the following procedures with respect to the District’s internal control environment:
Documented systems to assess the design and implementation of control activities that were determined to be relevant to the audit.
Discussed and considered potential audit risks with management. The results of these procedures were considered in determining the extent and nature of substantive audit testing required.
We are required to report to you in writing significant deficiencies in internal control that we have identified during the audit. A significant deficiency is defined as a deficiency or combination of deficiencies in internal control that, in the auditor's professional judgment, is of sufficient importance to merit the attention of those charged with governance.
As the purpose of the audit is for us to express an opinion on the District’s consolidated financial statements, our audit cannot be expected to disclose all matters that may be of interest to you. As part of our work, we considered internal control relevant to the preparation of the consolidated financial statements such that we were able to design appropriate audit procedures. This work was not for the purpose of expressing an opinion on the effectiveness of internal control.
SIGNIFICANT DEFICIENCIES IN INTERNAL CONTROL
Deficiency Issue and Impact
None noted NA
12 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
OTHER REQUIRED COMMUNICATIONS
Professional standards require independent auditors to communicate with those charged with governance certain matters in relation to an audit. In addition to the points communicated within this letter, the table below summarizes these additional required communications.
Audit Planning Audit Results Required Communication Auditor Comments Presentation Presentation
1. Our responsibilities under Canadian Included in our engagement letter dated December 18, 2019 Auditing Standards (CAS) 2. Our audit strategy and audit scope Included in our Planning Report dated December 20, 2019
3. Fraud risk factors Included in our Planning Report dated December 20, 2019
4. Going concern matters None
5. Significant estimates or judgments See Page 13
6. Audit adjustments See Appendix C
7. Unadjusted differences See Appendix C
8. Omitted disclosures None noted
9. Disagreements with management There were no disagreements with management
10. Consultations with other accountants No external experts were consulted during this engagement or experts 11. Major issues discussed with None management in regards to retention 12. Significant difficulties encountered No significant difficulties were encountered during our audit during the audit
13 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Audit Planning Audit Results Auditor Comments Required Communication Presentation Presentation
13. Significant deficiencies in internal No significant deficiencies were noted control 14. Material written communication No material written communications were noted between BDO and management 15. Any relationships which may affect our No independence issues noted independence 16. Any illegal acts identified during the No illegal activities identified through the audit process audit 17. Any fraud or possible fraudulent acts No fraud identified through the audit process identified during the audit 18. Significant transactions with related None noted parties not consistent with ordinary business operations 19. Non-compliance with laws or No legal or regulatory non-compliance matters were noted as part of regulations identified during the audit our audit
20. Limitations of scope over our audit, if None any
21. Written representations made by See Appendix D management 22. Any modifications to our opinion, if Please see our draft independent auditor’s report included in required Appendix A
14 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
APPENDIX A: INDEPENDENCE LETTER
April 17, 2020
Members of the Performance and Audit Committee Metro Vancouver Regional District 4730 Kingsway Burnaby, BC V5H 0C6
Dear Performance and Audit Committee Members:
We have been engaged to audit the consolidated financial statements of Metro Vancouver Regional District (the “District”) for the year ended December 31, 2019.
Canadian generally accepted auditing standards (GAAS) require that we communicate at least annually with you regarding all relationships between the District and our Firm that, in our professional judgment, may reasonably be thought to bear on our independence.
In determining which relationships to report, we have considered the applicable legislation and relevant rules and related interpretations prescribed by the appropriate provincial institute/order, covering such matters as:
Holding a financial interest, either directly or indirectly in a client;
Holding a position, either directly or indirectly, that gives the right or responsibility to exert significant influence over the financial or accounting policies of a client;
Personal or business relationships of immediate family, close relatives, partners or retired partners, either directly or indirectly, with a client;
Economic dependence on a client; and
Provision of services in addition to the audit engagement.
We have prepared the following comments to facilitate our discussion with you regarding independence matters arising since January 9, 2019, the date of our last letter.
We are not aware of any relationships between the District and our Firm that, in our professional judgment, may reasonably be thought to bear on independence that have occurred from January 9, 2019 to the date of this letter. We hereby confirm that we are independent with respect to the District within the meaning of the Code of Professional Conduct of the Chartered Professional Accountants of British Columbia as of the date of this letter.
This letter is intended solely for the use of the Audit Committee, the Board of Directors, management and others within the District and should not be used for any other purposes.
Yours truly,
Brian Szabo, CPA, CA Bill Cox, FCPA, FCA Partner through a corporation Partner through a corporation BDO Canada LLP BDO Canada LLP Chartered Professional Accountants Chartered Professional Accountants
15 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
APPENDIX B: ADJUSTED AND UNADJUSTED DIFFERENCES
SUMMARY OF UNADJUSTED DIFFERENCES
The following is a summary of uncorrected differences noted during the course of our audit engagement:
Metro Vancouver Regional District Dr. (Cr.) (consolidated) Assets Liabilities Accumulated Annual Surplus Surplus
Greater Vancouver Sewerage and Drainage District
Dr. Grant revenue $ 17,400,000 Cr. Investment income $ (5,100,000) Cr. Accumulated surplus $ (12,300,000) To record opening accumulated surplus impact of interest earned on and revenue recognition over grant funding relating to prior years.
Metro Vancouver Regional District
Dr. Debt reserve fund $ 2,120,898 Cr. Debt reserve fund, $ (2,120,898) TransLink To record TransLink debt reserve fund for debt matured in 2019 but cash received in 2020.
Total $ 2,120,898 $ (2,120,898) $ (12,300,000) $ 12,300,000 $ - $ - $ - $ - Effect of Prior Year’s Reversing Errors
Total Adjusted Differences $ 2,120,898 $ (2,120,898) $ (12,300,000) $ 12,300,000
16 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
SUMMARY OF ADJUSTED DIFFERENCES
The following is a summary of differences that were corrected by management during the course of our audit engagement:
Metro Vancouver Regional District Dr. (Cr.)
(consolidated) Assets Liabilities Accumulated Annual Surplus Surplus
Dr. Other revenue $ 7,577,000 Cr. Tangible capital assets $ (7,577,000) To adjust accounting entry incorrectly recorded to other revenue.
Total Adjusted Differences $ - $ - $ (7,577,000) $ 7,577,000
SUMMARY OF DISCLOSURE OMISSIONS
The following is a summary of disclosures that have not been made within the consolidated financial statements:
Disclosure Omission Management’s Response
None NA
17 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
APPENDIX C: REPRESENTATION LETTER
DATE
BDO Canada LLP Chartered Professional Accountants 600 Cathedral Place 925 West Georgia Street Vancouver BC V6C 3L2
This representation letter is provided in connection with your audit of the financial statements of Metro Vancouver Regional District and the following entities (collectively the “Districts”) for the year ended December 31, 2019, for the purpose of expressing an opinion as to whether the financial statements are presented fairly, in all material respects, in accordance with Canadian public sector accounting standards:
Greater Vancouver Water District (“GVWD”) Greater Vancouver Sewerage and Drainage District (“GVSDD”) Metro Vancouver Housing Corporation (“MVHC”)
We confirm that to the best of our knowledge and belief, having made such inquiries as we considered necessary for the purpose of appropriately informing ourselves:
Financial Statements
We have fulfilled our responsibilities, as set out in the terms of the audit engagement dated December 18, 2019, for the preparation of the financial statements in accordance with Canadian public sector accounting standards; in particular, the financial statements are fairly presented in accordance therewith.
Significant assumptions used by us in making accounting estimates, including those measured at fair value, are reasonable.
Related party relationships and transactions have been appropriately accounted for and disclosed in accordance with the requirements of Canadian public sector accounting standards.
All events subsequent to the date of the financial statements and for which Canadian public sector accounting standards require adjustment or disclosure have been adjusted or disclosed.
The financial statements of the entity use appropriate accounting policies that have been properly disclosed and consistently applied.
The effects of uncorrected misstatements are immaterial, both individually and in the aggregate, to the financial statements as a whole. A list of the uncorrected misstatements is attached to the representation letter. Information Provided
We have provided you with:
access to all information of which we are aware that is relevant to the preparation of the financial statements, such as records, documentation and other matters; additional information that you have requested from us for the purpose of the audit; and unrestricted access to persons within the entity from whom you determined it necessary to obtain audit evidence.
18 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
We are responsible for the design, implementation and maintenance of internal controls to prevent, detect and correct fraud and error, and have communicated to you all deficiencies in internal control of which we are aware.
All transactions have been recorded in the accounting records and are reflected in the financial statements.
We have disclosed to you all known instances of non-compliance or suspected non-compliance with laws and regulations whose effects should be considered when preparing the financial statements.
We have disclosed to you the identity of the entity’s related parties and all the related party relationships and transactions of which we are aware.
Fraud and Error
We have disclosed to you the results of our assessment of the risk that the financial statements may be materially misstated as a result of fraud.
We have disclosed to you all information in relation to fraud or suspected fraud that we are aware of and that affects the entity and involves:
management; employees who have significant roles in internal control; or others where the fraud could have a material effect on the financial statements. We have disclosed to you all information in relation to allegations of fraud, or suspected fraud, affecting the entity’s financial statements communicated by employees, former employees, analysts, regulators, or others. General Representations
Where the value of any asset has been impaired, an appropriate provision has been made in the financial statements or has otherwise been disclosed to you.
We have provided you with significant assumptions that in our opinion are reasonable and appropriately reflect our intent and ability to carry out specific courses of action on behalf of the entity when relevant to the use of fair value measurements or disclosures in the financial statements.
We confirm that there are no derivatives or off-balance sheet financial instruments held at year end that have not been properly recorded or disclosed in the financial statements.
Except as disclosed in the financial statements, there have been no changes to title, control over assets, liens or assets pledged as security for liabilities or collateral.
The entity has complied with all provisions in its agreements related to debt and there were no defaults in principal or interest, or in the covenants and conditions contained in such agreements.
There have been no plans or intentions that may materially affect the recognition, measurement, presentation or disclosure of assets and liabilities (actual and contingent).
The nature of all material uncertainties have been appropriately measured and disclosed in the financial statements, including all estimates where it is reasonably possible that the estimate will change in the near term and the effect of the change could be material to the financial statements.
19 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
There were no direct contingencies or provisions (including those associated with guarantees or indemnification provisions), unusual contractual obligations nor any substantial commitments, whether oral or written, other than in the ordinary course of business, which would materially affect the financial statements or financial position of the entity, except as disclosed in the financial statements.
Other Representations Where the Situation Exists.
We have informed you of all known actual or possible litigation and claims, whether or not they have been discussed with legal counsel. Since there are no actual, outstanding or possible litigation and claims, no disclosure is required in the financial statements.
The financial statements and any other information in the annual report provided to you prior to the date of this representation letter are consistent with one another, and there is no material misstatement of the other information. We have provided you with the final version of the document(s) comprising the annual report.
We have specifically considered the impacts of COVID-19 on the amounts and disclosures in the financial statements. To the best of our knowledge and belief the disclosures in the financial statements are accurate and complete.
We will provide to you, when available and prior to issuance by the entity, the final version of the document(s) comprising the annual report.
Yours truly,
______Signature Position
______Signature Position
20 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
APPENDIX D: MANAGEMENT LETTER
April 30, 2020
Mr. Jerry Dobrovolny Chief Administrative Officer Metro Vancouver Regional District Metrotower III 4730 Kingsway Burnaby BC V5H 0C6
Dear Mr. Dobrovolny
During the course of our audit of the consolidated financial statements ("financial statements") of Metro Vancouver Regional District for the year ended December 31, 2019, we identified matters which may be of interest to management. The objective of an audit is to obtain reasonable assurance whether the financial statements are free of any material misstatement and it is not designed to identify matters that may be of interest to management in discharging its responsibilities. Accordingly an audit would not usually identify all such matters.
The responsibility for producing financial statements and ensuring adequate internal controls and sound business practices is the responsibility of the Board of Directors through management and is a part of management's overall responsibility for the ongoing activities of the District . Policies and procedures developed by the District to safeguard its assets and to provide reasonable assurance that errors and irregularities or illegal acts are promptly identified, must be properly monitored to ensure that all staff are complying with the guidelines provided. Where we determined, from our testing, that there exists a need for improvement in existing systems of internal control or if we detected that the District 's staff are not complying with the critical accounting policies and procedures provided by management, we increased our year-end testing of account balances to ensure that audit risk was kept to an appropriately low level.
The comments and concerns expressed herein did not have a material effect on the District 's financial statements and, as such, our opinion thereon was without reservation. However, in order for the District to ensure the safeguarding of its assets and the accuracy of its records, we believe our comments and concerns should be taken into consideration by management. Our comments are not intended to reflect upon the honesty or competence of the District 's employees.
The matters we have identified are discussed in Appendix 1.
This communication is prepared solely for the information of management and is not intended for any other purposes. We accept no responsibility to a third party who uses this communication.
We would like to express our appreciation for the cooperation and assistance which we received during the course of our audit from Dean Rear, Linda Sabatini, and the rest of the Finance Department.
We shall be pleased to discuss with you further any matters mentioned in this report at your convenience.
21 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Yours truly,
Brian Szabo, CPA, CA Bill Cox, FCPA, FCA Partner through a corporation Partner thorough a corporation BDO Canada LLP BDO Canada LLP Chartered Professional Accountants Chartered Professional Accountants
22 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Appendix 1
1. Password complexity
During our review of IT controls over Unit4 and PeopleSoft, we noted the password complexity setting within Active Directory was not engaged. This setting requires passwords to include characters with certain criteria to be considered valid. We recommend that this setting be enabled to ensure there is no unauthorized access within information systems and that segregation of duty is appropriately maintained.
Management response: System security is very important to Metro Vancouver. We will investigate the impact of turning on the password complexity settings in Active Directory to strengthen our system security.
2. Accruals for outstanding invoices
During the audit process, we reviewed the recorded transactions for accruals over invoices that are outstanding but unpaid at year end. These invoices may span multiple departments and are overseen by various department heads. The amounts are recorded in the general ledger primarily through complex journal entries composed of numerous individual invoices.
Though no material issues were noted, due to the manual nature of this process, there is increased risk of error and/or duplications. More importantly there may be opportunity for further automation to improve efficiency. We recommend reviewing the accrual and accounts payable reporting to explore ways to automate the process, reduce the manual inputs, and provide improved technology controls to reduce the risk for errors.
Management response:
While the UNIT 4 financial system had been in place for a couple of years, we continue to investigate opportunities to implement efficiencies enabled by the system. We will review opportunities in our UNIT4 financial system to automate the invoice accrual process to reduce manual entries.
3. Efficiency of accounting records
As the District grows in size and scope, so does the complexity of internal accounting processes, supporting schedules, and financial reporting. Though no material errors were noted, as internal schedules become more complex, the risk of errors occurring increases and management’s ability to efficiently review information decreases. We recommend that management critically analyze internal accounting records and schedules to ensure, where possible, reports are automated, and summarized with key information such as prior year and budget comparisons, and documentation of nature and purpose of transactions. Schedules should be summarized to support detailed transactional listings. This will allow transparency between departments who may rely on these schedules, and ease of understanding to make higher level review more efficient.
23 Performance and Audit Committee Audit Final Report for Metro Vancouver Regional District For the year ended December 31, 2019
Management response:
Agreed. Management continues to take steps to automate reporting and undertake a proactive review of transactions. During the year, through the UNIT4 system, a new process was implemented where all significant entries are reviewed prior to being posted into the system. In addition, we are investigating improved reporting capabilities within the UNIT4 system and working towards a corporate digital reporting strategy to automate reporting and business intelligence.
4. Grant revenue recognition
We have proposed an uncorrected audit adjustment over the accounting for revenue recognition over grants. The adjustment relates to how grant revenue is recognized for capital projects where the project may be funded by more than one funding source, including internal funding. We recommend management establish an accounting policy over recognition of grants to ensure consistency of revenue recognition across all grants while meeting the requirements of PS 3410 Government Transfers.
Management response:
Agreed. Grant revenue related to capital project funding will be recognized in a consistent manner to meet PS 3410.
24 Performance and Audit Committee 5.2
To: Performance and Audit Committee
From: Dean Rear, General Manager, Financial Services/Chief Financial Officer
Date: April 17, 2020 Meeting Date: May 6, 2020
Subject: Audited 2019 Financial Statements
RECOMMENDATION a) That the MVRD Board approve the Audited 2019 Consolidated Financial Statements for the Metro Vancouver Regional District; b) That the GVS&DD Board approve the Audited 2019 Financial Statements for the Greater Vancouver Sewerage and Drainage District; c) That the GVWD Board approve the Audited 2019 Financial Statements for the Greater Vancouver Water District; d) That the MVHC Board approve the Audited 2019 Financial Statements for the Metro Vancouver Housing Corporation.
EXECUTIVE SUMMARY Although we have recently encountered unprecedented uncertainty with COVID-19, the 2019 Audited Financial Statements illustrate that Metro Vancouver entered this period in strong financial position with excellent liquidity and solid reserves following the Board policy.
The statements have been prepared in accordance with Canadian Public Sector Accounting Standards (“PSAS”) and have received an unqualified audit opinion by the external auditors, BDO Canada LLP.
PURPOSE To present, for approval, the Audited 2019 Financial Statements for the Metro Vancouver Districts and the Metro Vancouver Housing Corporation.
BACKGROUND Legislation requires that annual Audited Financial Statements be prepared for the Metro Vancouver Districts and Metro Vancouver Housing Corporation and presented at a public meeting of the Board of Directors. The Audited Financial Statements for 2019 have been prepared by management in accordance with Canadian public sector accounting standards (“PSAS”) and have received an unqualified audit opinion by the external auditors, BDO Canada LLP.
2019 FINANCIAL STATEMENT HIGHLIGHTS Under PSAS regulations, governments are required to present four statements with explanatory notes - Statement of Financial Position (Exhibit A), Statement of Operations (Exhibit B), Statement of Net Debt (Exhibit C) and Statement of Cash Flows (Exhibit D). The District also includes a number of schedules for additional reference. It is important to note that there are differences between the presentation in these financial statements and the annual Metro Vancouver budget, which is prepared to determine the annual revenue requirements to meet expenditure obligations. These differences are outlined in note 17 of the consolidated statements.
Performance and Audit Committee Audited 2019 Financial Statements Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 2 of 3
The complete set of 2019 Audited Financial Statements is attached. These are presented for the Boards’ approval and include: Audited 2019 Consolidated Financial Statements for the Metro Vancouver Regional District Audited 2019 Financial Statements for the Greater Vancouver Sewerage and Drainage District Audited 2019 Financial Statements for the Greater Vancouver Water District Audited 2019 Financial Statements for the Metro Vancouver Housing Corporation
The consolidated financial statements combine the accounts of the Metro Vancouver Regional District, Greater Vancouver Sewerage and Drainage District, Greater Vancouver Water District and the Metro Vancouver Housing Corporation.
Two statements, the Summarized Consolidated Statement of Financial Position (Appendix 1) and the Consolidated Statement of Operations (Appendix 2), similar to the Balance Sheet and Income Statement in private organizations, are the foundation of the audited statements. They contain three key indicators, the accumulated surplus, annual surplus and net debt.
The Summarized Statement of Financial Position (Appendix 1) contains two of the indicators, the net debt and the accumulated surplus. The net debt position represents the amount by which the Districts’ liabilities exceed the financial assets. Although the amount appears as unfavourable, the vast majority of the organization’s liabilities are long-term debt which is repayable over several years. The organization’s financial assets are more than sufficient to offset the amount of short- term obligations. The current ratio which is current assets divided by current liabilities and is a measure of an organization’s liquidity is 3.3 to 1. A ratio of 2 to 1 is considered to be a measure of favourable liquidity. The net debt position increased by only $153.7 million, while the increase in tangible capital assets was $642.6 million. This indicates that more of the District’s investment in capital infrastructure is being funded more through operations and reserves rather than debt.
The next indicator, also presented in the Summarized Statement of Financial Position (Appendix 1) is the accumulated surplus. Commonly thought of as “Net Worth” in private organizations, the District’s accumulated surplus is favourable at $4.9 billion, which indicates that the organization owns (Financial and Non-Financial Assets) more than it owes (Liabilities). This reflects the member municipalities’ net investment in the District’s consolidated entity. It comprises reserve balances of $260.1 million and the investment in tangible capital assets (assets less debt owing) of $4.6 billion.
The accumulated surplus increased by $489.6 million in 2019 which represents the annual surplus for the year, the final indicator. The annual surplus is calculated as the difference between revenues and expenses and detailed in Consolidated Statement of Operations (Appendix 2). For PSAS purposes, annual surplus does not include contributions to and from reserves, capital contributions or principal payments on long-term debt.
Additional explanations pertaining to the Summarized Consolidated Statement of Financial Position (Appendix 1) and the Consolidated Statement of Operations (Appendix 2) are included in the 2019 Financial Statement Highlights (Appendix 3) and in a separate report titled “5.3 2019 Financial Results Year-End”.
Performance and Audit Committee Audited 2019 Financial Statements Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 3 of 3
ALTERNATIVES These financial statements are a statutory requirement prepared in accordance to specific accounting principles. No alternatives are presented.
FINANCIAL IMPLICATIONS There are no financial implications relative to the approval of the Audited 2019 Financial Statements.
SUMMARY / CONCLUSION The financial statements are part of the legislated reporting requirements for 2019 and staff recommends their approval. As noted in the Auditors’ Report, it is the Auditors’ opinion that these Financial Statements present fairly the financial position of the Metro Vancouver Districts and the Metro Vancouver Housing Corporation as of December 31, 2019, and the results of their financial activities and changes in their financial position for the year then ended in accordance with Canadian public sector accounting standards.
Attachments: Appendix 1 - Summarized Consolidated Statement of Financial Position Appendix 2 - Consolidated Statement of Operations Appendix 3 - Management Discussion and Analysis - 2019 Financial Statement Highlights Attachment 1 - Metro Vancouver Districts and Metro Vancouver Housing Corporation Financial Statements for the year ended December 31, 2019
Performance and Audit Committee APPENDIX 1
Performance and Audit Committee
APPENDIX 2
Performance and Audit Committee
APPENDIX 3
Management Discussion and Analysis – 2019 Financial Statement Highlights
Summarized Consolidated Statement of Financial Position
The purpose of the Consolidated Statement of Financial Position (Appendix 1) is to present the organization’s assets, liabilities, net debt position and accumulated surplus or equity position. The accumulated surplus could also be interpreted as the net worth of the organization.
Relevant explanations pertaining to the Summarized Consolidated Statement of Financial Position are as follows:
Accumulated The key performance indicator on Statement of Financial Position is the Surplus Accumulated Surplus. The accumulated surplus for the District is favourable at $4.9 billion, which indicates that the organization owns (Financial and Non- Financial Assets) more than it owes (Liabilities). This amount is often referred to in private organizations as “Net Worth”, and reflects the member municipalities’ net investment in the District’s consolidated entity. It comprises reserve balances of $260.1 million and the investment in tangible capital assets (assets less debt owing) of $4.6 billion.
The accumulated surplus increased by $497.2 million in 2018 which represents the annual surplus for the year, calculated as the difference between revenues and expenses and detailed in Appendix 2. For PSAS purposes, annual surplus does not include contributions to and from reserves, capital contributions or principal payments on long-term debt.
Financial Assets
Cash, Cash Cash, cash equivalents and investments consist of cash and both long and short- Equivalents term investments. The 2019 balance was significantly lower than 2018 as a and result increased approved capital spending in 2019 for utility infrastructure Investments projects funded in part from the application of deferred grants and reserves previously held in cash and investments.
Accounts Accounts receivable are amounts due through the normal course of District Receivable business and are net of any allowance for doubtful accounts, which is negligible. The balance at December 31, 2019 comprises mainly of tipping fees due from commercial solid waste haulers, development cost charge (DCC) income, industrial sewer charges from commercial customers and payments due from our member municipalities for water sales. The amount is higher than 2018, mainly due to the increase in DCC receivable from members as a result of the increase in DCC rates in 2019.
Asset held for On March 12, 2019, Metro Vancouver’s two former head office properties were sale sold. The gain from the sale, net of book value, of $63.15 million was included in the income in the 2019 financial statements.
Performance and Audit Committee
Financial Assets (continued)
Debt Reserve The debt reserve fund represents the amount required, under agreement with Fund the Municipal Finance Authority (MFA), as security for debt service obligations related to MFA debentures issued to the Districts and its members. This represents 1% of the debenture issues. These amounts are refundable, with interest, upon debenture maturity. This balance fluctuates upward with new debt issues and downward as issues mature. The total debt reserve fund balance can be segregated into two components: 1) Member Municipalities and Translink ($34.1 million). This amount is the related to debt service obligations for these organizations and is fully refundable to them. Therefore, it has no impact on Metro Vancouver’s financial position. 2) Metro Vancouver ($20.7 million). This amount is related to debt incurred to fund infrastructure.
Liabilities
Accounts Accounts payable and other liabilities consists of amounts owing: Payable and • to suppliers for goods received and services rendered, primarily those Other relating to capital projects; Liabilities • to employees for future benefits which represent the potential payments to employees of entitled benefits, such as banked vacation; • to MFA and mortgage providers for interest accrued on debt; and • for the District’s share of landfill closure and post closure costs at the Vancouver and Cache Creek landfills.
The increase of $74.1 million is mostly a result of an increase of in construction holdbacks, trade and other payables due to the increase in capital project spending of $735.8 million compared to $422.7 million in 2018.
Deferred Deferred revenue and refundable deposits include: Revenue and • $227.6 million of restricted funds raised through the collection of Refundable development cost charges (DCCs), which will be used to fund future liquid Deposits waste growth capital projects; • $153.7 million for the Provincial grant associated with the construction of the new North Shore Wastewater Treatment plant; • $15.5 million of restricted funds in MVHC which will be used for the replacement of equipment and specified building components and to offset future operating deficits in specific programs; • $2.4 million in security deposits in MVHC and Parks; and • $3.9 million from miscellaneous deferred grants and revenues in other programs.
The decrease of deferred revenue for the year is due mainly to the utilization of DCCs and the Provincial grant to fund GVS&DD capital projects, including the North Shore Wastewater Treatment plant.
Performance and Audit Committee
Liabilities (continued)
Debt Debt, net of sinking funds reflects the amount of long term borrowing outstanding at the end of 2019. Sinking funds consist of principal payments made over the term of the debt issue. These payments are invested which along with the interest earned will offset the debt repayment at maturity.
TransLink and The debt owing to MFA for TransLink and member municipalities reflects Member borrowing on behalf of these entities to fund major capital projects. The amount Municipalities is completely offset reflecting the fact that these entities are responsible for the debt. Therefore, the impact on Metro Vancouver’s financial position is nil.
Overall debt for these entities decreased by $13.5 million. New long-term borrowing during the year totaled $94.095 million relating to debt borrowed by the Township of Langley ($19.95 million), Port Coquitlam ($52.0 million) and New Westminster ($22.145 million). This increase is offset by debt and sinking fund payments of $53.8 million and sinking fund interest earned of $26.8 million. In addition, there was $50.4 million in debt maturities with an equal offsetting amount of sinking fund retirements.
Metro The debt owing on behalf of the Metro Vancouver Districts and Metro Vancouver Vancouver Housing Corporation reflects borrowing to fund major infrastructure projects. The net amount owing for Metro Vancouver at the end of 2019 is $1.24 billion. To put this in context, Metro Vancouver has tangible capital assets of $5.7 billion and an investment in non-financial assets (assets less debt owing) of $4.5 billion.
The debt decreased by $1.97 million. New long term borrowing was $109.5 million – $86.0 million borrowed on behalf of GVS&DD, $22.0 million for GVWD and $1.5 million related to MVHC forgivable loan. This increase is offset by debt and sinking fund payments of $90.4 million and sinking fund interest earned of $21.07 million. In addition, there was $57.5 million in debt maturities with an equal offsetting amount of sinking fund retirements.
Net Debt The net debt position indicates the amount by which the organizations’ liabilities exceed the financial assets. Although the amount appears as unfavourable, the vast majority of the organization’s liabilities are long-term debt which is repayable over several years. The organization’s financial assets are more than sufficient to offset the amount of short-term obligations. The current ratio which is current assets divided by current liabilities and is a measure of an organization’s liquidity is 3.3 to 1. A ratio of 2 to 1 is considered to be a measure of favourable liquidity.
While the increase in tangible capital assets of $642.6 million, the net debt position increased by only $153.7 million, which indicates that more of the District’s investment in capital infrastructure is being funded through operations and reserves rather than debt.
Performance and Audit Committee
Non-Financial Non-financial assets represent the value of tangible capital assets, inventories of Assets supplies held by the organization, the prepaid portion of land leases on housing properties, and prepaid expenses for items such as insurance.
The Tangible Capital Assets balance represents the historical cost of the asset less accumulated amortization. The increase in 2019 is the direct result of the capital expenditures made during the year, the majority of which were for water and sewer infrastructure projects.
Consolidated Statement of Operations
The Consolidated Statement of Operations (Appendix 2) identifies the results of the organization’s financial activities for the year by presenting revenues less expenses, which is the annual surplus. This statement consolidates the revenues and expenses of the Districts’ and MVHC.
The annual surplus of $489.6 million serves as the 2019 addition to the organization’s overall accumulated surplus position or net worth of $4.9 billion. The accumulated surplus in this statement is also articulated in the Summarized Consolidated Statement of Financial Position and Equity (Appendix 1).
As noted above, the annual surplus as presented under PSAS is different from the annual surplus as determined in the context of the annual budget, which is $21.3 million. The primary difference is that PSAS excludes contributions to and from reserves as well as capital contributions and principal payments on long-term debt. These excluded items form a significant part of the annual approved budget.
Relevant explanations pertaining to the Consolidated Statement of Operations are as follows:
Revenue
Metered Sale of Metered water sales for 2019 were lower than budget due to slightly less Water consumption than anticipated, but $10.7 million higher than 2018 as a result of the increased consumption over the prior year and a 5.8% increase in rates.
Tipping Fees Tipping fee revenues in Solid Waste were higher than budgeted due primarily to higher than expected waste flows in the system during 2019, an additional 71,000 tonnes. The waste flows and revenue in 2019 are comparable to the 2018 levels.
Development Development cost charges (DCCs) applied against growth capital debt costs are Cost Charges slightly lower than budget due to growth capital expenditures and related debt financing being less than budget. However, the amount is significantly higher than prior year because of direct application of DCCs to project funding rather than just servicing growth debt servicing.
Performance and Audit Committee
Revenues (continued)
Property Rentals Property rentals in the Housing Corporation were slightly higher than budget and prior year due to lower than anticipated vacancy rates,+++ consistently below 1%.
Grants and Other Grants and other contributions of $55.9 million include grants in-lieu of taxes Contributions ($1.4 million), grants related GVS&DD capital projects ($54.0 million), and subsidies and contributions received by MVHC ($2.0 million). These grants are offset by a $1.9 million contribution to MVHC’s restricted reserves (deferred revenue). Under MVHC’s operating contracts and PSAS requirements, surpluses related to restricted programs are recorded as contributions to deferred revenue and lower the amount of revenue recorded. Grants are significantly higher than prior year due to the application of capital grant for the North Shore Wastewater Treatment, however, they are lower than budget due to less spending on the project and therefore less grant application than anticipated.
User fees, User fees, recoveries and other revenue were $78.5 million higher than budget Recoveries and mainly due to the gain on the sale of former head office buildings of $63.15 Other Revenue million and revenue of $13.6 million received for cost-sharing recoveries related to capital projects.
Sinking fund Sinking fund income and interest income pertains to Metro Vancouver sinking Income and funds and investment balances. The income is higher than anticipated as the Interest Income milestone payments for North Shore Wastewater Treatment plant were later than expected, resulting in a higher than expected average investment balance for the year. The 2019 results are lower than 2018 due to a significant portion of the GVWD debt maturing in late 2018 and 2019, resulting in a decrease in sinking fund balance and income.
Sinking Fund Sinking fund income, members and TransLink relates to income earned on sinking Income, funds for debt incurred on behalf of these organizations. This income, although Members and recognized in the Financial Statements, is income attributed to the other TransLink organizations. There is an offsetting item under expenses, so the net impact to Metro Vancouver is nil.
Expenses
Sewer (Liquid Expenses for Liquid Waste Services were lower than budget due to $5.5 million Waste) lower debt costs; $3.6 million underspend in Minor Capital projects due to the Operations deferral of some projects, $7.7 million in Residuals program due to lower grit production than expected from the Iona solids handling facility, $1.4 million in Research and Innovation program due to delay in the commencement of SIF projects and $3.3 million disposal of tangible capital assets. While debt servicing was lower than anticipated for 2019, it was higher than 2018 due to increased capital borrowing and a key reason for the actual variance from 2018, along with lower spending on minor capital projects in 2018.
Performance and Audit Committee
Expenses (continued)
Waste Disposal, Expenditures in Solid Waste operations were higher than budget and higher Recycling and than prior year largely due a one-time cost of $20.9 million from the City of Regulatory Vancouver that was excluded from the Vancouver Landfill operating rate Services (Solid calculations, as well as additional waste system volume. Waste)
Water Water Operations spent less than budget and was less than prior year due to Operations labour underspends from operating staff vacancies (ongoing recruitment), the deferral of some projects, lower operating expenditures for water treatment, residuals and water supply programs and delayed easement acquisition purchases. Debt servicing costs were lower than anticipated by approximately $2.7 million for the year as a result of additional contribution to capital from the application of the 2018 operational surplus, thereby lowering new debt financing.
Building Although Building Operations shows expenditures of $1.8 million more than Operations budget as a result of higher than anticipated expenses related to the sale of the former head office buildings and additional borrowing costs, these were offset by higher revenues, including the gain of $63.1 million on the sale of the buildings.
Housing Rental Housing expenditures were slightly lower than budget due to underspends of Operations approximately $615,000 in capital replacement work due to permit and design delays in major building envelope projects, and $600,000 in miscellaneous operational expenditures in administrative, communications, tenant and other program services. Expenditures are reported as $6.3 million higher than prior year, because 2018 had a significant underspend in capital replacement ($5.1 million) due to revised schedules of larger envelope and roofing projects.
General General government services had lower than expected expenditures mainly as a Government result of cancellations or lower attendance at meetings in Board and Legislative Services Services totaling $260,000; offset by an increase in expenditures of $87,000 for National Zero Waste Council, which was offset by an increase in revenues. Expenditures were $367,000 more than 2018 as the 2019 budget approved increased expenditures communications and collaborative initiatives programs.
Regional Parks Regional Parks expenses were less than budget due underspends in materials, maintenance, equipment rentals and consulting due to timing of seasonal work, work done by internal staff, delays in some studies and lower filming activity in 2019. Expenditures were $7.2 million less than prior year primarily because 2018 had a one-time charge of $8.2 million related to the transfer of assets to the City of Abbotsford.
Performance and Audit Committee
Expenses (continued)
Air Quality Air Quality expenditures were slightly over budget by 1% primarily due to legal fees for Regulation and Enforcement, these were offset by higher revenues as the function had an overall surplus for the year. Expenditures were lower than 2018 as there were unusually higher legal fees in 2018 from Regulation and Enforcement.
Regional Expenditures in Regional Employers Services were lower than budgeted due to legal Employers fees being lower than anticipated due to timing of bargaining. In addition, there Services were a few staff vacancies and delays in recruitment.
911 Emergency E911 expenditures were essentially on budget for the year and comparable to Telephone the prior year. System
Regional Regional Planning ended the year underspent in expenditures primarily due to Planning labour vacancies and lower than planned consulting expenditures. The expenditures were higher than prior year due to general budget increases in 2019 and staff lower staff vacancies in 2019 versus 2018.
Affordable Expenditures for Affordable Housing were lower than budget due to two vacant Housing program manager positions for the majority of 2019, leading to an underspend in salaries by $286,000, offset by over expenditures in consulting by $50,000.
Electoral Areas Electoral Areas expenditures were over budget by $545,000 and higher than prior year by a similar amount, due to a one-time Board approved contribution from the Community Works Fund for green infrastructure to mitigate storm water impacts at the University Endowment Lands and pedestrian and cycling improvements at Wesbrook Mall.
Regional Global The RGPS program was underspend due to lower than expected equipment Positioning purchases and consulting costs. The amount spent in 2019 is significantly higher System (RGPS) than prior year ($151,000), because the 2019 budget included 59% approved expenditure increase which was offset by reserve funding.
Sasamat Sasamat Volunteer Fire Department expenditures were on target for 2019 and Volunteer Fire slightly lower than prior year as 2018 included one-time equipment purchases. Department
Regional The Regional Prosperity Program was a new program in 2019 and was Prosperity underspent due to the timing of the approval of the new service resulting in underspends in labour, consulting and contract services.
Performance and Audit Committee
Expenses (continued)
Regional IPREM’s expenditures for 2019 were lower than anticipated due to staff Emergency vacancies. The program had an approved increase in contributions to the Management IPREM program over that for 2018. (IPREM)
Homelessness The Homelessness Partnering Strategy Program was a federally funded program Partnering that was completed in March of 2019. The expenditures incurred in 2019 Strategy represent three months of the program which are directly offset by federal government grants.
Corporate Corporate Program Costs represent expenditures for centralized services such Program Costs as Finance, Human Resources, External Relations, Corporate Services, Legal and Indigenous Relations which were surplus to budget by $570,000 for 2019. Also included are the gross costs for Fleet Services, which for budget purposes are allocated to the individual functions.
Performance and Audit Committee METRO VANCOUVER DISTRICTS’ AND METRO VANCOUVER HOUSING CORPORATION
(OPERATING AS METRO VANCOUVER)
Financial Statements
Year ended December 31, 2019
DRAFT - April 3, 2020
Performance and Audit Committee Consolidated Financial Statements of
METRO VANCOUVER REGIONAL DISTRICT (OPERATING AS METRO VANCOUVER)
Year ended December 31, 2019
DRAFT ‐ April 3, 2020
Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT Index to Consolidated Financial Statements
December 31, 2019
Exhibit
Independent Auditor's Report
Management Report
Consolidated Statement of Financial Position A
Consolidated Statement of Operations B
Consolidated Statement of Change in Net Debt C
Consolidated Statement of Cash Flows D
Notes to Consolidated Financial Statements
Schedule
Unaudited Consolidated Schedules of:
Operating Fund 1
Capital Funds 2
Performance and Audit Committee Tel: 604 688 5421 BDO Canada LLP Fax: 604 688 5132 600 Cathedral Place [email protected] 925 West Georgia Street www.bdo.ca Vancouver BC V6C 3L2 Canada
Independent Auditor’s Report
To the Members of the Board of Directors of the Metro Vancouver Regional District
Opinion We have audited the consolidated financial statements of the Metro Vancouver Regional District and its controlled entities (the “Consolidated Entity”), which comprise the consolidated Statement of Financial Position as at December 31, 2019, and the consolidated Statements of Operations, Change in Net Debt and Cash Flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Consolidated Entity as at December 31, 2019 and its results of operations, changes in net debt, and cash flows or the year then ended in accordance with Canadian public sector accounting standards. Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Consolidated Entity in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, management is responsible for assessing the Consolidated Entity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Consolidated Entity or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Consolidated Entity’s financial reporting process. Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.DRAFT
BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. Performance and Audit Committee 1 As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: · Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. · Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Consolidated Entity’s internal control. · Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. · Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Consolidated Entity’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Consolidated Entity to cease to continue as a going concern. · Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. · Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Other Matter — Supplementary Information We draw attention to the fact that the supplementary information included in Schedules 1 and 2 do not form part of the audited financial statements. We have not audited or reviewed this supplementary information and, accordingly, we do not express any opinion, review conclusion or any other form of assurance on this supplementary information.
Chartered Professional Accountants
Vancouver, British Columbia [DATE] DRAFT
Performance and Audit Committee 2
METRO VANCOUVER DISTRICTS’ AND METRO VANCOUVER HOUSING CORPORATION (Operating as Metro Vancouver) MANAGEMENT REPORT
The Consolidated Financial Statements contained in this report have been prepared by management in accordance with Canadian public sector accounting standards. The integrity and objectivity of these statements are management’s responsibility. Management is responsible for all the statements and schedules, and for ensuring that this information is consistent, where appropriate, with the information contained in the financial statements.
Management is also responsible for implementing and maintaining a system of internal controls to provide reasonable assurance that reliable financial information is produced.
The Metro Vancouver Regional District’s Board of Directors is responsible for approving the consolidated financial statements and for ensuring that management fulfills its responsibilities for financial reporting and internal control and exercises this responsibility through the Performance and Audit Committee of the Board.
The external auditors, BDO Canada LLP, conduct an independent examination, in accordance with Canadian Auditing Standards, and express their opinion on the consolidated financial statements. Their examination does not relate to the other schedules and statements required by the Financial Information Act. The Independent Auditor’s Report outlines the scope of the audit for the year ended December 31, 2019.
On behalf of the Metro Vancouver Regional District, Greater Vancouver Sewerage & Drainage District, Greater Vancouver Water District and Metro Vancouver Housing Corporation.
Date: May 29, 2020 Dean Rear, Chief Financial Officer
Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT Exhibit A Consolidated Statement of Financial Position
Year ended December 31, 2019
2019 2018
Financial Assets Cash and cash equivalents $ 96,049,572 $ 198,167,658 Accounts receivable (note 2) 155,499,785 111,762,125 Due from TransLink and member municipalities (note 3) 994,708,786 981,214,223 Investments (note 4) 772,576,974 905,089,800 Assets held for sale (note 5) ‐ 22,850,898 Debt reserve fund (note 6) 54,866,303 54,808,505 2,073,701,420 2,273,893,209 Liabilities Accounts payable and accrued liabilities (note 7) 261,755,237 189,299,303 Employee future benefits (note 8) 13,841,000 13,480,800 Landfill closure and post‐closure liability (note 9) 33,038,006 31,709,200 Deferred revenue and refundable deposits (note 10) 403,054,556 534,590,870 Debt reserve fund, member municipalities and TransLink (note 6) 34,082,428 34,608,994 Debt (net of sinking funds) (note 11) Metro Vancouver Districts and Housing Corporation 1,228,901,429 1,230,774,045 Translink and member municipalities 983,845,065 970,556,778 Total debt 2,212,746,494 2,201,330,823 2,958,517,721 3,005,019,990 Net Debt (884,816,301) (731,126,781)
Non‐Financial Assets Tangible capital assets (note 12) 5,740,451,084 5,097,823,719 Inventories of supplies 7,499,041 7,483,046 Prepaid land leases (note 13) 5,451,900 5,646,699 Prepaid expenses 7,175,639 6,311,255 5,760,577,664 5,117,264,719
Accumulated Surplus (note 14) $ 4,875,761,363 $ 4,386,137,938
Contractual obligations and rights (note 15) Contingencies (note 16) Subsequent event (note 19)
The accompanying notes are an integral part of these consolidated financial statements.
Chief Financial Officer
Board Chair
Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT Exhibit B Consolidated Statement of Operations
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 17)
Revenue (note 18) MVRD property tax requisitions $ 62,900,800 62,900,800 59,174,609 Metered sale of water 286,908,565 285,316,390 274,631,383 Sewerage and drainage levy 255,810,755 255,810,755 232,134,617 Tipping fees 98,362,329 105,692,375 102,036,530 Housing property rentals 39,309,579 40,869,815 39,904,174 BODTSS industrial charges 11,022,967 11,219,515 11,265,803 Development cost charges 153,665,173 152,388,981 10,759,806 Electricity sales 5,927,304 5,793,404 5,584,341 Trucked liquid waste fees 1,096,167 1,219,798 1,157,301 Source control fees 1,207,102 1,201,837 1,357,501 Grants and other contributions 103,081,121 55,871,601 1,509,186 User fees, recoveries and other revenue 23,797,200 102,346,040 47,939,179 Sinking fund and interest income 23,279,691 28,314,441 34,765,584 Sinking fund income, members and TransLink 29,744,768 27,126,596 27,772,544 1,096,113,521 1,136,072,348 849,992,558
Expenses (note 18) Sewer operations 202,475,306 180,034,752 164,887,263 Waste disposal, recycling and regulatory services 102,034,830 129,703,804 108,329,525 Water operations 155,531,417 139,135,846 141,103,474 Housing rental operations 35,810,257 34,724,330 28,415,532 Regional parks 32,186,500 30,200,001 37,379,381 General government services 5,327,567 5,145,005 4,778,069 Air quality 9,645,995 9,655,250 9,739,334 Regional employers services 2,625,712 2,153,505 2,115,074 911 emergency telephone system 4,331,446 4,281,688 4,300,157 Regional planning 3,335,051 2,946,447 1,853,378 Affordable housing 749,823 492,430 1,388,179 Electoral areas 404,600 949,264 443,065 Regional global positioning system 520,793 385,969 235,206 Regional properity 475,000 57,792 ‐ Sasamat volunteer fire department 257,248 247,259 328,743 Integrated Partnership for Regional Emergency Management 249,331 168,906 121,889 Homelessness Partnering Strategy 2,241,413 3,323,349 11,340,520 Corporate program costs 53,472,654 57,695,808 49,642,480 Building operations 16,140,162 18,020,922 17,635,821 Sinking fund income attributed to members and TransLink 29,744,768 27,126,596 27,772,544
657,559,873 646,448,923 611,809,634
Annual surplus 438,553,648 489,623,425 238,182,924
Accumulated surplus, beginning of year 4,386,137,938 4,386,137,938 4,147,955,014
Accumulated surplus, end of year $ 4,824,691,586 4,875,761,363 4,386,137,938
The accompanying notes are an integral part of these consolidated financial statements.
Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT Exhibit C Consolidated Statement of Change in Net Debt
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 17)
Annual surplus $ 438,553,648 $ 489,623,425 $ 238,182,924
Change in tangible capital assets Acquisition of tangible capital assets (927,455,130) (728,284,821) (422,716,028) Amortization of tangible capital assets 81,169,354 82,197,312 81,858,909 Disposal of tangible capital assets ‐ 3,460,144 8,520,471 (846,285,776) (642,627,365) (332,336,648)
Change in other non‐financial assets Acquisition of prepaid expenses ‐ (6,647,194) (6,311,255) Use of prepaid expenses ‐ 5,782,810 4,857,263 Amortization of prepaid land leases ‐ 194,799 194,799 Acquisition of inventories of supplies ‐ (7,499,041) (7,483,046) Consumption of inventories of supplies ‐ 7,483,046 6,734,534 ‐ (685,580) (2,007,705)
Change in net debt (407,732,128) (153,689,520) (96,161,429)
Net debt, beginning of year (731,126,781) (731,126,781) (634,965,352)
Net debt, end of year $ (1,138,858,909) $ (884,816,301) $ (731,126,781)
The accompanying notes are an integral part of these consolidated financial statements.
Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT Exhibit D Consolidated Statement of Cash Flows
Year ended December 31, 2019
2019 2018
Cash provided by (used in):
Operating transactions: Annual surplus 489,623,425 $ 238,182,924 Items not involving cash Amortization of tangible capital assets 82,197,312 81,858,909 Amortization of prepaid land leases 194,799 194,799 Sinking fund income (48,045,117) (53,120,867) Debt reserve fund income (1,262,768) (1,236,101) Accrued interest and unamortized premium or discount (1,644,794) (923,269) Loss (gain) on disposal of tangible capital assets and asset held for sale (60,032,021) 8,054,605 Employee future benefit expense 2,355,300 2,253,400 Change in landfill closure and post‐closure liability 1,328,806 25,742 Change in non‐cash financial assets and liabilities Accounts receivable (43,737,660) (4,602,161) Due from Translink and member municipalities (13,494,563) 70,028,001 Accounts payable and accrued liabilities 72,455,934 51,927,998 Employee future benefits paid (1,995,100) (2,197,500) Deferred revenue and refundable deposits (131,536,314) 36,142,372 Debt reserve fund, member municipalities and TransLink (404,955) (2,759,544) Inventories of supplies (15,995) (748,512) Prepaid expenses (864,384) (1,453,992) Net change in cash from operating transactions 345,121,905 421,626,804
Capital transactions: Proceeds on sale of tangible capital assets 86,343,063 465,866 Acquisition of tangible capital assets (728,284,821) (422,716,028) Net change in cash from capital transactions (641,941,758) (422,250,162)
Investing transactions: Acquisition of investments (414,500,175) (524,715,065) Investment maturities 548,657,795 324,799,000 Net change in cash from investing transactions 134,157,620 (199,916,065)
Financing transactions: Debenture debt and mortgages issued 203,642,723 409,912,647 Debt reserve fund issuances (2,020,950) (4,047,749) Debt reserve fund maturity 3,104,309 7,497,425 Sinking fund payments (135,475,086) (130,592,232) Principal repayments on housing mortgages and serial debt maturity (8,706,849) (10,419,658) Sinking fund retirement (107,978,064) (149,099,080) Debenture debt maturity 107,978,064 149,099,080 Net change in cash from financing transactions 60,544,147 272,350,433
Net change in cash and cash equivalents (102,118,086) 71,811,010
Cash and cash equivalents, beginning of year 198,167,658 126,356,648
Cash and cash equivalents, end of year 96,049,572 $ 198,167,658
The accompanying notes are an integral part of these consolidated financial statements.
Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 1
Year ended December 31, 2019
1. Significant Accounting Policies
The Metro Vancouver Regional District’s (the “District”) (operating as Metro Vancouver) consolidated financial statements reflect the assets, liabilities, revenues and expenses of four legal entities: the Metro Vancouver Regional District (“MVRD”), the Greater Vancouver Sewerage and Drainage District (“GVS&DD”), the Greater Vancouver Water District (“GVWD”) and the Metro Vancouver Housing Corporation (“MVHC”).
The MVRD was established under the Local Government Act of British Columbia. It provides a number of specific and agreed upon services directly to the public and its member municipalities, the major one of which is the ownership and operation of a network of regional parks. Its Board of Directors comprises mayors and councilors from the member municipalities appointed for that purpose by the municipalities. The number of directors, and the number of votes each may cast, is based upon the population of the municipality. Under the legislation, all staff, even if their work is under the authority of the related legal entities, are employees of the MVRD. The District serves as the borrowing conduit between member municipalities (excluding the City of Vancouver) and the Municipal Finance Authority of British Columbia (MFA). The GVS&DD and GVWD also access MFA through the MVRD. Prior to the enactment of the South Coast British Columbia Transportation Authority (SCBCTA) in 2007, the District also served as the borrowing conduit for the Greater Vancouver Transportation Authority (GVTA), commonly referred to as “TransLink”. The District is no longer the borrowing conduit for TransLink; however, under the terms of the SCBCTA Act, the District, SCBCTA and the municipalities in the transportation service region are jointly and severally liable for obligations arising under a security issued by the District on behalf of TransLink.
The GVS&DD was established by an Act of the same name in 1956. Its two principal responsibilities are the collection, treatment and discharge of liquid waste for the municipalities of the MVRD, and the disposal of solid waste for the municipalities of the MVRD and the public. GVS&DD owns and operates wastewater treatment plants and a related collection network connected to the municipal collection systems, and several solid waste facilities including a waste to energy facility. Its Board of Directors comprises the same councilors and mayors as appointed to the MVRD Board by the participating municipalities. The member municipalities, under the Act, are jointly and severally liable for debts of GVS&DD.
The GVWD was established by an Act of the same name in 1924. Its primary responsibility is the supply of potable water to its member municipalities. Its Board of Directors comprises the same councilors and mayors as appointed to the MVRD Board by the participating municipalities. GVWD owns or holds under a 999 year lease from the Province, an extensive closed watershed network as its source of supply. It owns a series of dams, reservoirs, water treatment plants and a distribution network connecting to the municipal distribution systems. The member municipalities, under the Act, are jointly and severally liable for debts of GVWD. GVWD also owns and is responsible for operating and maintaining office buildings that are leased to MVRD and its related entities.
The MVHC is a wholly‐owned subsidiary of the MVRD. The MVHC was incorporated under the Business Corporations Act (British Columbia) to own and operate housing sites within the Lower Mainland for the purpose of providing affordable rental housingPerformance and Audit Committee on a non‐profit basis.
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 2
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
The consolidated financial statements of the District are prepared by management in accordance with Canadian public sector accounting standards (“PSAS”). Significant accounting policies adopted by the District are as follows:
Basis of The consolidated financial statements reflect the combined assets, Consolidation liabilities, revenues and expenses of the reporting entity. The reporting entity comprises the MVRD, the GVS&DD, the GVWD and the MVHC. These organizations are controlled by the District. All transactions and balances between these entities have been eliminated on consolidation.
Basis of Accounting The District follows the accrual method of accounting for revenue and expenses. Revenue is recognized in the year in which it is earned and measurable. Expenses are recognized as they are incurred and measurable as a result of the receipt of goods or services and/or the legal obligation to pay.
Government Government transfers, are recognized as revenue in the financial Transfers statements when the transfer is authorized and any eligibility criteria are met, except to the extent that transfer stipulations give rise to an obligation that meets the definition of a liability. The transfer of revenue is initially deferred and then recognized in the statement of operations as the stipulation liabilities are settled.
When the District is deemed the transferor, the transfer expense is recognized when the recipient is authorized and has met the eligibility criteria.
Deferred Revenue Deferred revenue represents licenses, permits, development cost and Refundable charges, security deposits, restricted contributions and other fees Deposits which have been collected, but for which the related services or obligations have yet to be performed. These amounts will be recognized as revenue in the fiscal year the services are performed or obligations and stipulations have been met.
Sinking Fund, Debt Interest income is reported as revenue in the period earned. When Retirement and required, based on external restrictions, interest income earned on Interest Income deferred revenue is added to and forms part of the deferred revenue balance and is recognized into income when related stipulations are met. Any surpluses received from upon debt retirement are recorded in the year received.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 3
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
Cash Equivalents Cash equivalents include highly liquid financial instruments with a term to maturity of ninety days or less at the date of acquisition. Cash equivalents are recorded at the lower of cost plus accrued interest and market value.
Investments Investments consist of both long and short‐term instruments and are recorded at amortized cost using straight‐line method. Short‐term investments consist primarily of money market instruments with an original maturity greater than ninety days at the date of acquisition but less than one year. Long‐term investments consist primarily of bonds and fixed income securities with maturity greater than one year at the date of acquisition.
Employee Future The District and its employees participate in the Municipal Pension Benefits Plan. The Municipal Pension Plan is a multi‐employer contributory defined benefit pension plan. Payments made in the year are expensed.
Under the terms of various collective agreements and compensation policies, the District provides paid sick leave to eligible employees and in certain agreements allows unused sick days to accumulate. There are no payouts of unused sick days at termination. In addition, employees acquire certain employee benefits on termination and retirement. These include days for severance based on years of service, vacation based on years of service, Worker’s Compensation top‐up, and a full year’s vacation entitlement in the year of retirement. The costs of these benefits are actuarially determined based on service and best estimates of retirement ages and expected future salary and wage increases. The obligation under these benefit plans is accrued based on projected benefits as the employees render services necessary to earn the future benefits. Actuarial gains and losses are amortized over the expected average remaining service period of the related employee group, commencing the year after the gain or loss arises.
Landfill Closure and The estimated present value of landfill closure and post‐closure costs is Post‐Closure Liability recognized as a liability. This liability is recognized based on estimated future expenses, including estimated inflation discounted to the current date and accrued based on the proportion of the total capacity of the landfill used as of the date of the statement of financial position. The change in this estimated liability during the year is recorded as an expense in operations. These estimates are reviewed and adjusted annually and any changes are recorded on a prospective basis.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 4
Year ended December 31, 2019
1. Significant Accounting Policies (continued) Non‐Financial Non‐financial assets are not available to discharge existing liabilities Assets and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the ordinary course of operations. Tangible Tangible capital assets are recorded at cost which includes amounts that Capital Assets are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value, of the tangible capital assets, except land, is amortized over their estimated useful lives. All assets are amortized on a straight line basis as follows:
Asset Useful Life – Years Buildings Housing 25 – 35 Parks 50 Watershed 25 Corporate – Head Office 40 Infrastructure Sewer Wastewater treatment, pumping stations 50 Interceptors and trunk sewer, drainage 100 Solid Waste 25 – 30 Water Dams, reservoirs 150 Supply mains 100 Distribution systems, drinking water treatment 50 Parks Bridges, culverts, fencing 20 – 40 Trails 100 Roads, erosion protection, water and sewer 100 systems Information technology systems and networks 5 – 10 Vehicles 5 – 20 Machinery, Equipment, Furniture and Fixtures 5 – 20
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 5
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
Non‐Financial Assets (continued)
Tangible a. Annual amortization
Capital Assets Annual amortization begins when the asset is put in service and is expensed over its useful life. Assets under construction are transferred to the appropriate asset class and are amortized from the date the asset is put into productive use. b. Contributions of tangible capital assets
Contributions of tangible capital assets are recorded at their fair value at the date of receipt and as contribution revenue. c. Works of art and cultural and historic assets
Works of art and cultural and historic assets are not recorded as assets in these financial statements. d. Interest capitalization
The Districts do not capitalize interest costs associated with the acquisition or construction of a tangible capital asset.
Inventories of Inventories of supplies held for consumption are recorded on a first‐in, Supplies first‐out basis.
Prepaid Land Prepaid land leases are recorded at historical cost less accumulated Leases amortization. Upon expiration of the lease contract, the property will revert to the lessor. Prepaid land leases are amortized on a straight‐line basis over the lease term.
Revenue Property tax revenues and sewerage and drainage revenues from Recognition member municipalities are recognized in the year they are levied. Metered sale of water, tipping fees, permits, cost sharing and other revenue are recognized as revenue on an accrual basis according to the usage and rates approved and set by the Board. Housing property rental revenue is recognized over the rental period once the tenant commences occupancy, rent is due and collection is assured. Segmented A segment is defined as a distinguishable activity or group of activities of Information a government for which it is appropriate to separately report financial information to achieve the objectives of the standard. The District has provided definitions of the District’s segments as well as presented financial information in segmented format in note 18.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 6
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
Liability for A liability for remediation of a contaminated site is recognized when Contaminated Sites the site is no longer in productive use and the following criteria are satisfied: an environmental standard exists; contamination exceeds the standard; the District is either directly responsible or has accepted responsibility for remediation; it is expected that future economic benefits will be given up and a reasonable estimate of the liability can be made. Liabilities for contaminated sites is reported in accounts payable and accrued liabilities (note 7).
Use of Estimates The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the period. These estimates and assumptions are based on management’s best information and judgment and may differ from actual results. Adjustments, if any, will be reflected in the financial statements in the period that the change in estimate is made, as well as in the period of settlement if the amount is different.
Significant areas requiring the use of management’s judgment relate to the determination of accrued liabilities, contaminated sites liabilities, the employee future benefits liability, the amortization rates for tangible capital assets, the landfill closure and post‐closure liability in GVS&DD and the assessment of all contingencies.
2. Accounts Receivable
2019 2018
GVWD $ 61,092,957 $ 54,366,686 GVS&DD 81,009,886 46,180,865 MVHC 417,096 499,609 MVRD 12,979,846 10,714,965 $ 155,499,785 $ 111,762,125
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 7
Year ended December 31, 2019
3. Due from TransLink and Member Municipalities The District is reimbursed for amounts paid to the MFA for the obligations incurred on behalf of its member municipalities and TransLink whose undertakings were financed out of the proceeds of these obligations (refer to note 11). The amount recoverable is net of sinking funds and includes accrued interest as follows:
Net Debt Accrued Recoverable Interest 2019 2018
TransLink $ 382,304,407 $ 5,475,319 $ 387,779,726 $ 439,736,664 Member Municipalities 601,540,658 5,388,402 606,929,060 541,477,559 $ 983,845,065 $ 10,863,721 $ 994,708,786 $ 981,214,223
4. Investments
Yields Maturity Dates 2019 2018
Bonds: Government 1.75 ‐ 3.11% June 2021 ‐ March 2031 $ 89,081,187 $ 89,081,187 Corporate 1.56 ‐ 3.20% January 2020 ‐ March 2028 250,733,108 371,890,902 . Unamortized premium (discount) 762,504 (882,289) 340,576,799 460,089,800 Term deposits 2.37 ‐ 3.20% January 2020 – September 2021 280,000,000 267,500,000 GICs 2.34 ‐ 3.12% January 2020 ‐ November 2024 152,000,175 177,500,000 Total $ 772,576,974 $ 905,089,800 Government bonds include debt securities issued by the federal and provincial governments of Canada, and the Municipal Finance Authority of British Columbia. Corporate bonds include Schedule I and II chartered banks of Canada. Market value of investments at December 31, 2019 was $782,198,600 (2018 ‐ $907,721,242).
5. Assets Held for Sale Head office operations for MVRD and its related Districts were relocated in 2017 and former head office buildings were made available for sale. On March 12, 2019, the land and buildings were sold resulting in a gain, net of book value, of $63.15 million.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 8
Year ended December 31, 2019
6. Debt Reserve Fund The MFA provides financing for regional districts and member municipalities. The MFA is required to establish a Debt Reserve Fund for each debenture issue equal to one‐half the average annual installment of principal and interest. The debt reserve fund is comprised of cash deposits equal to 1% of the principal amount borrowed and a non‐interest bearing demand note for the remaining requirement. Cash deposits held by the MFA are payable with interest to the ultimate borrower when the final obligations under the respective loan agreements have been made. If, at any time, the District has insufficient funds to meet payments due on its obligations to MFA, the payments will be made from the debt reserve fund. The demand notes are callable only if there are additional requirements to be met to maintain the level of the debt reserve fund. At December 31, 2019, $97,250,040 (2018 ‐ $96,147,831) in callable demand notes were outstanding and have not been recorded in the statement of financial position.
2019 2018 Cash deposits held by MFA on behalf of: Translink and member municipalities $ 34,082,428 $ 34,608,994 Metro Vancouver Districts 20,783,875 20,199,511 $ 54,866,303 $ 54,808,505
7. Accounts Payable and Accrued Liabilities
2019 2018
Trade accounts $ 174,700,318 $ 130,256,504 Construction holdbacks 53,880,362 26,147,125 Accrued interest on debt 22,107,771 22,227,668 Wage accruals 10,804,374 8,030,962 Contaminated sites (a) 245,079 2,255,050 Other 17,333 381,994 $ 261,755,237 $ 189,299,303
a) The District accrued $245,079 ($2,255,050 in 2018) for estimated current costs to remediate contaminated soils at one of its properties within the GVWD. The remediation of the site is underway and expected to be completed in 2020.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 9
Year ended December 31, 2019
8. Employee Future Benefits The employee future benefits have been based on the results of an actuarial valuation done by an independent actuarial firm. A full valuation was performed as of December 31, 2019. Information about liabilities for the District’s employee benefit plans is as follows:
2019 2018
Accrued benefit liability: Accrued benefit obligation, end of year $ 20,844,400 $ 17,255,000 Unamortized actuarial loss (7,003,400) (3,774,200) Accrued benefit liability, end of year $ 13,841,000 $ 13,480,800
2019 2018
Accrued benefit obligation: Balance, beginning of year $ 17,255,000 $ 18,117,800 Current service cost 1,208,200 1,227,500 Interest cost 539,800 529,500 Benefits paid (1,995,100) (2,197,500) Workers compensation top‐up expense 115,200 ‐ Plan curtailment ‐ (193,700) Actuarial loss (gain) 3,721,300 (228,600) Accrued benefit obligation, end of year $ 20,844,400 $ 17,255,000
2019 2018 Employee future benefit expense: Current service cost $ 1,208,200 $ 1,227,500 Interest cost 539,800 529,500 Workers compensation top‐up expense 115,200 ‐ Plan curtailment ‐ (46,200) Amortization of the actuarial loss 492,100 542,600 $ 2,355,300 $ 2,253,400
The significant actuarial assumptions adopted in measuring the District’s accrued benefit obligation are as follows: 2019 2018 Discount rate 2.50% 3.10% Expected future inflation rate 2.00% 1.80% Expected average remaining service period 11.3 years 11.0 years
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 10
Year ended December 31, 2019
9. Landfill Closure and Post‐Closure Liability The District is responsible for its share of closure and post‐closure costs at four landfill sites as detailed below.
a) The Vancouver landfill is located in Delta, BC. In accordance with an agreement with the City of Vancouver, the District is responsible for its proportionate share of the closure and post‐ closure liability based on usage. The present value of the District’s estimated future liability for these expenses is recognized as the landfill site’s capacity is used and is as follows:
2019 2018
Opening balance $ 31,709,200 $ 31,071,458 Impact due to changes in: Utilization 2,144,522 2,857,585 Assumptions (2,475,339) (2,612,058) Discount rate 1,659,623 392,215 Closing balance $ 33,038,006 $ 31,709,200
The closure and post‐closure liability and annual expense is calculated based on the ratio of actual utilization to total expected utilization of the site’s capacity at the date of closure. It is based on estimates and assumptions with respect to events extending over the remaining life of the Vancouver landfill, including provisions contained in Metro Vancouver’s Integrated Solid Waste and Resource Management Plan. The significant estimates and assumptions adopted in measuring the District’s share of the closure and post‐closure liability are as follows:
2019 2018 Current actual utilization (in tonnes) 21,139,073 20,479,845 Expected utilization at closure (in tonnes) 25,856,597 25,676,692 Expected remaining capacity (in tonnes) 4,717,524 5,196,847 Permitted capacity (in tonnes) 33,039,183 33,039,183 Proportionate share of liability 32.8% 31.5% Discount rate 2.89% 3.03% Expected post‐closure period 30 years 30 years Expected closure date December 31, 2037 December 31, 2037
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 11
Year ended December 31, 2019
9. Landfill Closure and Post‐Closure Liability (continued)
b) The Cache Creek landfill is located in the Village of Cache Creek, BC. The landfill permit obligates the Village of Cache Creek and a third party service provider to undertake closure and post‐closure activities. The District, in accordance with an agreement with the Village, was required to contribute quarterly to a trust fund, held with the Province of British Columbia, to a Post Closure Maintenance and Repair Fund at rates consistent with the operational certificate for the landfill. The agreement indemnifies the Village for any post closure liabilities which are not covered by this fund. At December 31, 2019, the trust had $16,091,490 (2018 ‐ $15,768,931). The Cache Creek landfill was closed December 2016. The actual utilization at closure was 10,318,780 tonnes and the permitted capacity was 10,371,594 tonnes. The post‐closure period is expected to be 30 years. The discount rate used as at December 31, 2019 is 2.89% (2018 ‐ 3.03%). Based on this information, the present value of the District’s estimated future liability for closure and post‐closure is as follows:
2019 2018
Opening balance $ 15,768,931 $ 16,034,726 Impact due to change in: Closure costs paid ‐ (612,000) Assumptions 322,559 346,205 Closing balance 16,091,490 15,768,931 Less post‐closure fund (16,091,490) (15,768,931) Closure liability $ ‐ $ ‐
c) The Coquitlam and Port Mann landfills were closed in 1983 and 1997, respectively, and there are no further closure and post‐closure liabilities.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 12
Year ended December 31, 2019
10. Deferred Revenue and Refundable Deposits The deferred revenue reported on the consolidated statement of financial position consists of the following:
2019 2018
MVHC restricted funds (a) i) Rental operations – BCHMC agreements $ 1,678,802 $ 1,876,441 ii) Replacement projects 13,835,772 11,762,771 15,514,574 13,639,212 GVS&DD development cost charges (b) 227,551,250 311,593,932 Provincial grant to fund capital expenditures (c) 153,675,034 200,367,548 Facility rental security deposits 2,376,526 2,352,000 Other 3,937,172 6,638,179
Total $ 403,054,556 $ 534,590,870
a) Amounts received under the following MVHC programs have been recorded as deferred revenue: i) Section 95 Rental Subsidy: Pursuant to Section 95 of the National Housing Act ("NHA") a portion of the funds received from rental operations to a cumulative maximum of $500 per unit are restricted and can only be used by MVHC according to the terms of the agreement with BCHMC. The amounts are recorded as deferred revenue and are used when expenditures exceed revenue in the program. ii) Replacement Projects: Under operating agreements entered into with Canada Mortgage and Housing Corporation (“CMHC”) and administered by BCHMC, a portion of the funds received from rental operations are restricted for the replacement of equipment and specified building components. These funds are deferred until spent on approved items. In accordance with the original CMHC agreements (Section 95), from the inception of a project, a maximum of 1% per annum of the original construction cost of the building is restricted and recorded as deferred revenue. With the administrative approval of BCHMC, the potential of restricted contributions may be adjusted from time to time based on an asset life cycle analysis. Expenditures funded from deferred revenue are periodically reviewed by BCHMC, and are restricted to the replacement of equipment and specified building components. In accordance with BCHMC agreements (Homes BC and Seniors project), any receipts in excess of expenses are restricted for approved projected capital repairs and replacements for each project. These revenues are deferred until spent on approved items.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 13
Year ended December 31, 2019
10. Deferred Revenue and Refundable Deposits (continued)
b) The GVS&DD Act restricts the District to applying money raised from development cost charges to funding sewer capital projects, including the repayment of debt raised to fund such projects. c) In 2017, the GVS&DD received a grant from the Province of British Columbia in the amount of $193,000,000 for costs associated with the construction of the new Lions Gate Wastewater Treatment Plant Facility. During 2019, $51,788,545 (2018 ‐ $nil) was applied against the capital project.
Continuity of deferred revenue and refundable deposits is as follows:
2019 2018
Balance, beginning of year $ 534,590,870 $ 498,448,498
Externally restricted contributions received: GVS&DD development cost charges 60,239,104 28,117,415 MVHC restricted funds 11,918,875 11,111,335 Interest earned 13,203,226 10,968,234 Other grants and deposits ‐ 899,779 Total contributions received 85,361,205 51,096,763 Contributions used and recognized in revenue (216,848,381) (14,806,493) Net change in externally restricted contributions (131,487,176) 36,290,270 Change in deposits and other deferred revenues (49,138) (147,898) (131,536,314) 36,142,372
Balance, end of year $ 403,054,556 $ 534,590,870
11. Debt a) All monies borrowed are upon the District’s credit at large and, in the event of any default, would constitute an indebtedness for which its members are jointly and severally liable. Debt servicing requirements comprising sinking fund contributions, serial and mortgage principal repayments and interest are funded as incurred by revenue earned during the year. b) Sinking fund installments are invested by the MFA and earn income which, together with principal payments, are expected to be sufficient to retire the sinking fund debt at maturity. For sinking fund agreements, the MFA has established either a normal sinking fund or a capital repayment equalization fund.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 14
Year ended December 31, 2019
11. Debt (continued)
c) In addition to debt incurred directly by the District, the District has also incurred long‐term debt on behalf of its member municipalities and TransLink through agreements with the MFA. Under the terms of these agreements, the District is required to provide for and pay to the MFA certain sums. Debt incurred on behalf of others is also presented as due from TransLink and member municipalities (note 3). Where the MFA has determined that sufficient resources exist to retire a debenture on its maturity date without further installments, debenture installments are suspended by the MFA. If the sums provided for are not sufficient, such deficiency shall be a liability of the District to the MFA until legally extinguished. The District is reimbursed for amounts paid to the MFA for the obligations incurred on behalf of the member municipalities and TransLink whose undertakings were financed out of the proceeds of these obligations. The following summarizes the debt incurred by the District as well as debt incurred on behalf of the member municipalities and TransLink.
Mortgages and Less Sinking Net Debt Net Debt Debenture Debt Funds 2019 2018
MVRD $ ‐ $ ‐ $ ‐ $ 62,468 GVS&DD 716,000,000 89,710,182 626,289,818 576,901,055 GVWD 1,026,230,930 467,731,518 558,499,412 607,491,049 MVHC 44,112,199 ‐ 44,112,199 46,319,473 1,786,343,129 557,441,700 1,228,901,429 1,230,774,045
TransLink 867,786,319 485,481,911 382,304,407 434,144,656 Member Municipalities 757,503,727 155,963,070 601,540,658 536,412,122 1,625,290,046 641,444,981 983,845,065 970,556,778 $ 3,411,633,175 $ 1,198,886,681 $ 2,212,746,494 $ 2,201,330,823
d) Included in MVHC debt is a forgivable loan from BCHMC related to the Heather Place development project in the amount of $6,685,520 (2018 ‐ $5,137,797). MVHC has been approved to receive $6.7 million by BCHMC. The loan is forgivable over a 35‐year term provided that the property is continuously used for the provision of housing for eligible occupants and there is no default under the loan or operating agreement. Commencing in the 11th year of the mortgage 1/25th will be forgiven each year. Should a breach in the agreement occur, the full outstanding balance of the loan would be due immediately. Payments of interest will not be required unless there is a default and consequently interest will be payable on the outstanding balance at prime plus 2% per annum, compounded semi‐ annually and not in advance.
e) Debt (net of sinking funds) reported on the statement of financial position is comprised of the following and includes varying maturities up to 2049, with interest rates ranging from 0.30% to 5.95%. Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 15
Year ended December 31, 2019
11. Debt (continued)
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 16
Year ended December 31, 2019
11. Debt (continued)
f) Principal payments and sinking fund installments due within the next five years and thereafter are as follows:
Less Recoverable Total Long‐ from TransLink Term Debt and Member Net Debt Payments Municipalities Payments
2020 $ 155,868,121 $ 54,898,790 $ 100,969,331 2021 149,216,226 54,904,957 94,311,269 2022 143,557,687 52,862,627 90,695,060 2023 132,822,831 50,256,206 82,566,626 2024 133,103,327 50,394,822 82,708,505 Thereafter 786,520,688 313,808,145 472,712,543 1,501,088,880 577,125,547 923,963,334 Estimated sinking fund income 711,657,614 406,719,518 304,938,095 Total $ 2,212,746,494 $ 983,845,065 $ 1,228,901,429
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 17
Year ended December 31, 2019
12. Tangible Capital Assets
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 18
Year ended December 31, 2019
12. Tangible Capital Assets (continued)
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 19
Year ended December 31, 2019
13. Prepaid Land Leases
2019 2018 Balance, beginning of year $ 5,646,699 $ 5,841,498 Amortization (194,799) (194,799) Balance, end of year $ 5,451,900 $ 5,646,699
The lease terms for the properties are as follows:
Lease Term Asset Lease Expiry Dates (Years) Buildings Habitat Villa February 2029 50 Walnut Gardens May 2026 42 Other prepaid land leases May 2036 to June 2062 60
14. Accumulated Surplus Accumulated surplus consists of individual fund surplus and reserves as follows:
2019 2018
Reserves $ 260,130,677 $ 289,348,698 Capital fund balance 104,081,031 229,739,566 Investment in tangible capital assets 4,511,549,655 3,867,049,674
Total $4,875,761,363 $ 4,386,137,938
Capital fund balance represents the future expected level of funding required.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 20
Year ended December 31, 2019
14. Accumulated Surplus (continued) The reserves are classified as either operating, discretionary or statutory and are presented in the following schedules:
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 21
Year ended December 31, 2019
14. Accumulated Surplus (continued)
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 22
Year ended December 31, 2019
14. Accumulated Surplus (continued) Investment in tangible capital assets is calculated as follows:
15. Contractual Obligations and Rights a) Contractual Obligations i) As at December 31, 2019, the District had the following commitments relating to projects in progress.
Authorized and Outstanding Expended at Total Total Projects December 31 2019 2018
GVS&DD $ 3,132,692,000 $ (1,158,074,049) $ 1,974,617,951 $ 1,778,078,249 GVWD 1,676,775,000 (690,929,000) 985,846,000 979,713,000 MVRD 7,582,171 (3,586,486) 3,995,685 961,640 MVHC 111,200,000 (25,298,623) 85,901,377 10,252,097 Total $ 4,928,249,171 $ (1,877,888,158) $ 3,050,361,013 $ 2,769,004,986
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 23
Year ended December 31, 2019
15. Contractual Obligations and Rights (continued) ii) The District is committed under a number of lease agreements to make minimum annual payments. These agreements have varying terms, including two agreements, with annual payments of currently of $440,000 to perpetuity, with adjustments annually for CPI. Estimated payments over the next ten years is as follows:
Amount 2020 $ 2,538,924 2021 2,462,058 2022 2,330,466 2023 2,246,285 2024 2,085,248 2025 ‐ 2029 10,843,331 Total $ 22,506,312
b) Contractual Rights: The District is party to several agreements that are anticipated to provide it with future revenues. These agreements are with third parties with varying terms to 2027. Amounts anticipated to be received over the future years are as follows:
Amount 2020 $ 6,749,996 2021 6,603,449 2022 6,303,172 2023 6,344,695 2024 6,377,991 Thereafter 18,891,399 Total $ 51,270,702
16. Contingencies Lawsuits As at December 31, 2019, there were various lawsuits pending against the District arising in the ordinary course of business. The District has retained legal counsel to defend against these lawsuits. Management is of the opinion that losses, if any, in connection with these lawsuits can be sufficiently funded by reserve funds or covered by insurance. Any ultimate losses will be accrued and recorded as expenses at the time the amounts are reasonably determinable.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 24
Year ended December 31, 2019
16. Contingencies (continued) Municipal The District and its employees contribute to the Municipal Pension Plan Pension Plan (the Plan), a jointly trusteed pension plan. The board of trustees, representing plan members and employers, is responsible for
administering the Plan, including investment of the assets and administration of benefits. The Plan is a multi‐employer defined pension plan. Basic pension benefits provided are based on a formula. As at December 31, 2018, the plan has about 205,000 active members and approximately 101,000 retired members. Active members include approximately 40,000 contributors from local government. Every three years, an actuarial valuation is performed to assess the financial position of the plan and the adequacy of plan funding. The actuary determines an appropriate combined employer and member contribution rate to fund the plan. The actuary’s calculated contribution rate is based on the entry‐ age normal cost method, which produces the long‐term rate of member and employer contributions sufficient to provide benefits for average future entrants to the plan. This rate may be adjusted for the amortization of any actuarial funding surplus and will be adjusted for the amortization of any unfunded actuarial liability. The most recent actuarial valuation for the Municipal Pension Plan as of December 31, 2018, indicated a $2,866 million funding surplus for basic pension benefits on a going concern basis. The District paid $14,096,770 for employer contributions (2018 ‐ $13,765,695) while employees contributed $12,402,783 (2018 ‐ $12,089,268) to the Plan in fiscal 2019. The next valuation will be as at December 31, 2021 with results available in 2022. Employers participating in the plan record their pension expense as the amount of employer contributions made during the fiscal year (defined contribution pension plan accounting). This is because the plan records accrued liabilities and accrued assets for the plan in aggregate resulting in no consistent and reliable basis for allocating the obligation, assets and cost to individual employers participating in the plan.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 25
Year ended December 31, 2019
16. Contingencies (continued) Self‐Insurance A self‐insurance reserve has been established within accumulated surplus Reserve to cover losses resulting from uninsured liability exposures of the District. Each year a review is undertaken to determine if it would be beneficial to purchase additional liability insurance. The District transfers amounts to the reserve depending on the reserve’s adequacy to cover retained liability risk. An estimate is made for all costs of investigating and settlement of claims annually and an adjustment is made to the reserve to maintain an adequate balance to cover potential losses in excess of recorded liabilities. These estimates are changed as additional information becomes known during the course of claims settlement. Any likely losses would be expensed at the time the losses are known and the amounts are reasonably determinable. Debt Reserve The MFA is required to establish a Debt Reserve Fund for each debenture Fund which is comprised of cash deposits and a non‐interest bearing demand note (refer to note 6). If, at any time, the District has insufficient funds to meet payments due on its obligations to MFA, the payments will be made from the debt reserve fund. The demand notes are callable only if there are additional requirements to be met to maintain the level of the debt reserve fund, and therefore have not been recorded in the statement of financial position. First Nations The District is currently involved in negotiations with First Nations Negotiations regarding compensation for the use of their land on which District assets reside. The compensation associated with these negotiations cannot be reasonably determined at this time and therefore no liabilities have been recorded at December 31, 2019.
17. Budget Information The annual budget presented in these financial statements is based upon the 2019 operating and capital budgets approved by the District’s Board in October 2018, with additional approval in May 2019 for adjustments to the budget as a result of the 2018 fiscal year end results. The budget is based on operational and capital expenditure requirements and their associated funding. Amortization is a non‐cash item that is not funded for budget purposes. Also, contributions to or from reserves and debt principal repayments are removed from the approved budget for financial statement presentation. The schedule below reconciles the approved budget to the budget figures reported in these financial statements. Capital expenditures of $ 927,455,130 were included in the capital budget approved by the Board.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 26
Year ended December 31, 2019
17. Budget Information (continued)
18. Segmented Information and Expenses by Object
The District is a diversified municipal government organization that provides a wide range of services directly to the public and its member municipalities through its four legal entities: the MVRD, the GVS&DD, the GVWD and the MVHC. For management reporting purposes, the District’s operations and activities are organized and reported by service areas within the legal entities. The salaries and benefits reported in the segmented information below do not include $24,298,691 (2018 ‐ $22,808,206) directly attributable to the construction of tangible capital assets which have been capitalized and included in tangible capital assets in the Statement of Financial Position. The legal entities disclosed in the segmented information, along with the service areas provided are as follows:
MVRD Regional Parks Regional Parks is responsible for managing, maintaining and protecting a diverse network of 22 Regional Parks and an expanding land base of reserves, ecological conservancy areas and greenways, located throughout the Region.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 27
Year ended December 31, 2019
18. Segmented Information and Expenses by Object (continued)
MVRD (continued) General General Government includes services responsible for overall direction Government and monitoring and regional initiatives. This area comprises the Regional Board & Committee Remuneration, Corporate Secretary’s Office, Audit, Legal and Insurance costs, Innovation, Regional Emergency Management, Regional Cultural Strategy and External Contributions. Air Quality Air Quality is responsible for monitoring air quality in the region, controlling industrial, commercial and some residential emissions, creating long‐term plans and conducting emission inventories. Affordable Housing Affordable Housing contributes to processes and decisions related to the development of affordable housing projects, and in particular to the redevelopment of the MVHC portfolio of mixed‐income housing complexes and the development of vacant lands owned by local government (including the MVRD). Regional Employee Regional Employee Services provides collective bargaining, job Services evaluation, research and other related labour relations services to those MVRD municipalities who are members of the function. 911 Emergency The District contracts with E‐Comm Corporation to provide 9‐1‐1 Telephone Service service for all municipalities within the region as well as the community of Whistler and the Sunshine Coast Regional District. Electoral Areas The District is responsible for providing general and local services to one unincorporated area (Electoral Area A) of the regional district. Electoral Area A occupies approximately 818 Km2 and varies from urban, suburban, seasonal use to rural and remote. General services provided include a variety of tax‐supported, regional services such as 9‐1‐1 emergency telephone, air quality, labour relations, regional parks, strategic planning and general government. Local services provided are specific to the needs of communities within the Electoral Area and include building permit and inspection, local planning, land use planning, election and general administration. Regional Global The District’s Global Positioning System (GPS) Real‐Time Service is Positioning System offered to member municipalities and to the public in partnership with the B.C. Crown Registry and Geographic Base (CRGB) Branch. Sasamat Volunteer The Sasamat Volunteer Fire Department provides volunteer fire Fire Department department services to the Villages of Anmore and Belcarra. The cost to support this function is borne completely by the members who receive the service.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 28
Year ended December 31, 2019
18. Segmented Information and Expenses by Object (continued) MVRD (continued) Regional Planning Regional Planning’s core responsibilities are focused on regional growth management, utility management and air quality management. Primary activities include development and implementation of a wide range of innovative policies and plans, extensive research, modeling and technical analysis, regulation, business demand management and community education. Integrated Integrated Partnership for Regional Emergency Management (“IPREM”) Partnership for is an intergovernmental partnership between the Province of British Regional Columbia and Metro Vancouver. IPREM was formed to coordinate Emergency regional emergency management planning activities. IPREM is designed Management to collaboratively engage all levels of government and private sector (IPREM) agencies in regional emergency planning initiatives for the Metro Vancouver region. Regional The Regional Economic Prosperity Service works with Metro Vancouver Prosperity members and public and private sector stakeholders to attract new Initiative strategic investment that will contribute positively to the region’s livability and sustainability. Homelessness The Homelessness Partnering was a federal government program, Partnering administered by MVRD, until March 31, 2019, with funding from Strategy Minister of Employment and Social Development Canada. The program’s mandate is to provide support for the needs of the homeless and those at‐risk of homelessness in the Metro Vancouver Designated Community. Corporate Corporate Programs include departments that provide centralized Programs services to the Districts. These departments include the Corporate Planning, External Relations, Financial Services, Human Resources, Legal and Legislative Services and Corporate Services. Costs for these programs are allocated to GVWD, GVS&DD, MVHC and MVRD, and are eliminated upon consolidation of the entities. GVS&DD Liquid Waste The Liquid Waste Management Service is responsible for the collection, Services treatment and discharge of liquid waste for member municipalities. It operates a number of wastewater treatment plants and a related collection network connected to the member municipalities’ systems. Solid Waste The Solid Waste Management Service is responsible for the disposal of Services solid waste both for the member municipalities and the public. It owns and operates several solid waste facilities including a waste to energy facility.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 29
Year ended December 31, 2019
18. Segmented Information and Expenses by Object (continued) GVWD Water Water Operations is responsible for the supply of potable water to its Operations member municipalities. It owns a series of dams, reservoirs, water treatment plants and a distribution network connected to the member municipalities’ systems.
Building Building Operations is responsible for operating and maintaining office Operations buildings owned by GVWD. These facilities are leased to MVRD and its related entities for its head office operations as well as to external parties.
MVHC Metro Vancouver Housing Corporation is a wholly‐owned subsidiary of MVRD, which owns and operates housing sites within the Lower Mainland for the purpose of providing affordable rental housing on a non‐profit basis through various housing programs, some federally and some provincially funded. MVHC’s portfolio consists of “rent‐geared‐to‐ income”, partial rent assistance, and low‐end‐of‐market units.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 30
Year ended December 31, 2019
18. Segmented Information and Expenses by Object (continued) a) Total Consolidated
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 31
Year ended December 31, 2019
18. Segmented Information and Expenses by Object (continued) b) Total Other Districts
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 32
Year ended December 31, 2019
18. Segmented Information and Expenses by Object (continued) c) Total Regional District
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Notes to Consolidated Financial Statements, page 33
Year ended December 31, 2019
19. Subsequent Event
Subsequent to year end, the impact of COVID‐19 in Canada and on the global economy has been unprecedented. As the impacts of COVID‐19 continue, there could be further impact on the District, its members, employees, suppliers and other third party business associates that could impact the timing and amounts realized on the District’s assets and future ability to deliver services and projects. At this time, the full potential impact of COVID‐19 on the District is not known. Although the disruption from the virus is expected to be temporary, given the dynamic nature of these circumstances, the duration of disruption and the related financial impact cannot be reasonably estimated at this time. The District’s ability to continue delivering non‐essential services and employ related staff, will depend on the legislative mandates from the various levels of government. The District will continue to focus on collecting receivables, managing expenditures, and leveraging existing reserves and available credit facilities to ensure it is able to continue providing essential services to its citizens.
Performance and Audit Committee
METRO VANCOUVER REGIONAL DISTRICT Schedule 1 Consolidated Schedule of Operating Fund (unaudited) Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual Revenue MVRD property tax requisitions $ 62,900,799 $ 62,900,800 $ 59,174,609 Metered sale of water 286,908,565 285,316,390 274,631,383 Sewerage and drainage levy 255,810,755 255,810,755 232,134,617 Tipping fees 98,362,329 105,692,375 102,036,530 Housing property rentals 39,309,579 40,869,815 39,904,174 BODTSS industrial charges 11,022,967 11,219,515 10,759,806 Development cost charges 31,665,173 30,388,981 11,265,803 Electricity sales 5,927,304 5,793,404 5,584,341 Trucked liquid waste fees 1,096,167 1,219,798 1,157,301 Source control fees 1,207,102 1,201,837 1,357,501 Grants and other contributions 1,881,121 2,228,284 (4,238,294) User fees, recoveries and other revenue 23,797,201 27,543,308 34,018,200 Sinking fund and interest income (22,312) 785,300 (53,492) 819,866,750 830,970,562 767,732,479
Expenses Core functions Sewer operations 177,750,906 155,712,591 140,439,373 Waste disposal, recycling and regulatory services 96,800,416 124,555,165 103,062,453 Water operations 120,715,158 109,481,658 106,512,229 Housing rental operations 33,735,307 32,421,124 25,330,932 Regional parks 30,529,894 28,575,519 27,613,692 General government services 5,327,567 5,145,005 4,778,069 Air quality 9,394,466 9,404,478 9,461,713 Regional employers services 2,625,712 2,153,505 2,115,074 911 emergency telephone system 4,325,083 4,275,325 4,161,313 Regional planning 3,335,051 733,288 1,853,378 Affordable housing 749,823 3,233,691 1,388,179 Electoral areas 404,600 102,019 443,065 Regional global positioning system 520,793 385,969 235,206 Regional prosperity 475,000 224,986 ‐ Sasamat volunteer fire department 224,389 3,185,644 289,702 Integrated Partnership for Regional Emergency Management 217,242 571,226 121,889 Homelessness Partnering Strategy 2,241,413 67,293 11,340,520 489,372,820 480,228,486 439,146,787 Corporate functions Corporate services 17,565,260 16,294,312 16,342,243 Building operations 11,358,934 13,238,671 12,925,460 Corporate planning ‐ ‐ 813,123 Legal and indigenous relations 4,620,939 3,902,065 2,995,010 External relations 6,106,370 5,742,189 5,868,305 Financial services 12,122,277 11,679,078 11,190,519 Human resources 5,182,119 4,762,437 4,529,886 Self insurance ‐ 1,082,978 117,444 56,955,899 56,701,730 54,781,990 546,328,719 536,930,216 493,928,777
Annual surplus, operating fund 273,538,031 294,040,346 273,803,702 Application of surplus and transfers Principal repayment on long‐term debt (3,755,206) (3,754,994) (5,594,378) Transfers from (to): Capital and other funds (186,286,397) (187,295,980) (148,946,788) Sinking and debt retirement funds (86,654,974) (86,655,029) (78,210,110) Reserve funds for: Reserves ‐ Operating results (4,129,854) (13,265,471) (40,984,118) Reserves 7,288,400 (3,068,872) (68,308) Change in accumulated surplus from operating fund ‐ ‐ ‐ Operating fund, beginning of year ‐ ‐ ‐
Operating fund, end of year $‐ $ ‐ $ ‐ Performance and Audit Committee METRO VANCOUVER REGIONAL DISTRICT Schedule 2 Consolidated Schedule of Capital Funds (unaudited)
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual
Revenues Grants and other contributions $ 101,200,000 $ 53,975,099 $ 5,878,448 Development cost charges 122,000,000 122,000,000 ‐ Debt reserve fund and interest income ‐ 449,165 583,050 Gain (loss) on disposal of assets ‐ 60,032,021 (8,054,605) Other income ‐ 13,593,106 14,862,203 223,200,000 250,049,391 13,269,096
Expenses Amortization of tangible capital assets 81,486,386 82,197,312 81,858,909 81,486,386 82,197,312 81,858,909
Annual deficit, capital and other funds 141,713,614 167,852,079 (68,589,813)
Non‐financial assets transactions Acquisition of tangible capital assets Sewer and Drainage District 654,060,000 449,379,197 323,048,856 Water District 231,400,000 243,148,000 72,945,127 Regional District 20,678,130 20,224,875 18,987,879 Housing Corporation 21,317,000 15,532,749 7,734,166 927,455,130 728,284,821 422,716,028 Amortization of tangible capital assets (81,486,386) (82,197,312) (81,858,909) Change in prepaid expenses and leases ‐ 194,799 194,799 Disposal of tangible capital assets ‐ (3,460,144) (8,520,471) 845,968,744 642,822,164 332,531,447
Financing Debenture debt issued 578,488,598 109,547,723 395,137,797 Transfers from: Operating funds 186,286,397 187,295,980 148,946,788 Reserve funds 60,879,012 52,467,847 108,253,762 825,654,007 349,311,550 652,338,347
(20,314,737) (293,510,614) 319,806,900 Change in capital funds 121,398,877 (125,658,535) 251,217,087
Fund balances, beginning of year 228,815,981 229,739,566 (21,477,521)
Fund balances, end of year $ 350,214,858 $ 104,081,031 $ 229,739,566
Capital Funds consists of: Prepaid land leases $ 5,841,498 $ 5,646,699 Temporary financing from working capital 98,239,533 224,092,867 $ 104,081,031 $ 229,739,566
Performance and Audit Committee
Financial Statements of
GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Year ended December 31, 2019
DRAFT ‐ April 3, 2020
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Index to Financial Statements
December 31, 2019
Exhibit
Independent Auditor's Report
Management Report
Statement of Financial Position A
Statement of Operations B
Statement of Change in Net Debt C
Statement of Cash Flows D
Notes to Financial Statements
Schedule
Unaudited Schedules of:
Operating Fund 1
Capital Fund 2
Performance and Audit Committee Tel: 604 688 5421 BDO Canada LLP Fax: 604 688 5132 600 Cathedral Place [email protected] 925 West Georgia Street www.bdo.ca Vancouver BC V6C 3L2 Canada
Independent Auditor’s Report
To the Members of the Board of Directors of the Greater Vancouver Sewerage and Drainage District
Opinion We have audited the financial statements of the Greater Vancouver Sewerage and Drainage District (the “District”), which comprise the Statement of Financial Position as at December 31, 2019, and the Statements of Operations, Change in Net Debt and Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the District as at December 31, 2019, and the results of its operations, change in net debt and cash flows for the year then ended in accordance with Canadian public sector accounting standards. Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the District in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the District’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the District or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the District’s financial reporting process. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: · Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detectingDRAFT a material misstatement resulting from fraud is higher than for one resulting from error,
BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. Performance and Audit Committee 1 as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. · Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. · Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. · Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the District’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the District to cease to continue as a going concern. · Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Other Matter — Supplementary Information We draw attention to the fact that the supplementary information included in Schedules 1 and 2 do not form part of the financial statements. We have not audited or reviewed this supplementary information and, accordingly, we do not express any opinion, review conclusion or any other form of assurance on this supplementary information.
Chartered Professional Accountants
Vancouver, British Columbia [DATE] DRAFT
Performance and Audit2 Committee
METRO VANCOUVER SEWERAGE AND DRAINAGE DISTRICT
MANAGEMENT REPORT
The Financial Statements contained in this report have been prepared by management in accordance with Canadian public sector accounting standards. The integrity and objectivity of these statements are management’s responsibility. Management is responsible for all the statements and schedules, and for ensuring that this information is consistent, where appropriate, with the information contained in the financial statements.
Management is also responsible for implementing and maintaining a system of internal controls to provide reasonable assurance that reliable financial information is produced.
The Greater Vancouver Sewerage and Drainage District’s Board of Directors is responsible for approving the financial statements and for ensuring that management fulfills its responsibilities for financial reporting and internal control and exercises this responsibility through the Performance and Audit Committee of the Board.
The external auditors, BDO Canada LLP, conduct an independent examination, in accordance with Canadian Auditing Standards, and express their opinion on the financial statements. Their examination does not relate to the other schedules and statements required by the Financial Information Act. The Independent Auditor’s Report outlines the scope of the audit for the year ended December 31, 2019.
On behalf of Greater Vancouver Sewerage and Drainage District.
Date: May 29, 2020 Dean Rear, Chief Financial Officer
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Exhibit A Statement of Financial Position
Year ended December 31, 2019
2019 2018
Financial Assets Cash $ 77,654 $ 126,585 Accounts receivable 81,009,886 46,180,865 Due from Metro Vancouver Regional District 696,213,073 938,579,870 Debt reserve fund (note 2) 7,677,816 6,817,838 784,978,429 991,705,158 Liabilities Accounts payable and accrued liabilities (note 3) 162,499,858 128,270,329 Landfill closure and post‐closure liability (note 4) 33,038,006 31,709,200 Deferred revenue and refundable deposits (note 5) 382,403,809 513,256,423 Debt (net of sinking funds) (note 6) 626,289,815 576,901,055 1,204,231,488 1,250,137,007 Net Debt (419,253,059) (258,431,849)
Non‐Financial Assets Tangible capital assets (note 7) 2,182,239,202 1,765,631,822 Inventories of supplies 4,637,990 4,661,611 Prepaid expenses 3,114,824 2,970,300 2,189,992,016 1,773,263,733 Accumulated surplus (note 8) $ 1,770,738,957 $ 1,514,831,884
Contractual obligations and rights (note 9) Contingencies (note 10) Subsequent event (note 13)
The accompanying notes are an integral part of these financial statements.
Chief Financial Officer
Board Chair
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Exhibit B Statement of Operations Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 11)
Revenue (note 12) Sewerage and drainage levy $ 255,810,755 $ 255,810,755 $ 232,134,617 Tipping fees 98,362,329 105,692,375 102,036,530 BODTSS Industrial Charges 11,022,967 11,219,515 11,265,803 Development cost charges (note 5) 153,665,173 152,388,981 10,759,806 Electricity sales 5,927,304 5,793,404 5,584,341 Trucked liquid waste fees 1,096,167 1,219,798 1,157,301 Source control fees 1,207,102 1,201,837 1,357,501 User fees, recoveries and other revenue 3,508,134 5,193,321 4,111,874 Sinking and debt retirement fund income 2,913,575 2,590,959 2,490,357 Interest income 2,275,705 2,959,455 4,771,701 Grants and other contributions (note 5) 101,200,000 53,975,099 5,878,448 636,989,211 598,045,499 381,548,279
Expenses (note 12) Liquid waste services 222,770,721 207,642,982 192,853,711 Solid waste services 106,522,407 134,495,444 113,189,157 329,293,128 342,138,426 306,042,868 Annual surplus 307,696,083 255,907,073 75,505,411
Accumulated surplus, beginning of year 1,514,831,884 1,514,831,884 1,439,326,473
Accumulated surplus, end of year $ 1,822,527,967 $ 1,770,738,957 $ 1,514,831,884
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Exhibit C Statement of Change in Net Debt Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 11)
Annual surplus $ 307,696,083 $ 255,907,073 $ 75,505,411
Change in tangible capital assets: Acquisition of tangible capital assets (654,060,000) (449,379,197) (323,048,856) Amortization of tangible capital assets 29,958,814 29,470,800 29,623,721 Disposal of tangible capital assets ‐ 3,301,017 276,810 (624,101,186) (416,607,380) (293,148,325)
Change in other non‐financial assets: Acquistion of prepaid expenses ‐ (3,114,824) (2,970,300) Use of prepaid expenses ‐ 2,970,300 1,728,411 Acquisition of inventories of supplies ‐ (4,637,990) (4,661,611) Consumption of inventories of supplies ‐ 4,661,611 4,341,637 ‐ (120,903) (1,561,863)
Changes in net debt (316,405,103) (160,821,210) (219,204,777)
Net debt, beginning of year (258,431,849) (258,431,849) (39,227,072)
Net debt, end of year $ (574,836,952) $ (419,253,059) $ (258,431,849)
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Exhibit D Statement of Cash Flows
Year ended December 31, 2019
2019 2018
Cash provided by (used in):
Operating transactions: Annual surplus $ 255,907,073 $ 75,505,411 Items not involving cash: Amortization 29,470,800 29,623,721 Sinking fund income (2,590,959) (2,490,357) Debt reserve fund income (164,912) (104,071) Loss on disposal of tangible capital assets 3,301,017 91,240 Change in landfill closure and post‐closure liability 1,328,806 25,742 Change in non‐cash assets and liabilities: Accounts receivable (34,829,021) (1,737,499) Prepaid expenses (144,524) (1,241,889) Accounts payable and accrued liabilities 34,229,529 60,027,357 Deferred revenue (130,852,614) 28,393,249 Inventories of supplies 23,621 (319,974) Net change in cash from operating transactions 155,678,816 187,772,930
Capital transactions: Proceeds on sale of tangible capital assets ‐ 185,570 Acquisition of tangible capital assets (449,379,197) (323,048,856) Net change in cash from capital transactions (449,379,197) (322,863,286)
Financing transactions: Due from Metro Vancouver Regional District 242,366,797 (281,750,429) Debenture debt issued 86,000,000 390,000,000 Debt reserve fund issuance (860,000) (3,900,000) Debt reserve fund maturity 164,934 237,363 Sinking fund payments (34,020,281) (13,691,028) Debenture debt maturity (10,000,000) (14,000,000) Sinking fund retirement 10,000,000 14,000,000 Net change in cash from financing transactions 293,651,450 90,895,906
Net change in cash and cash equivalents (48,931) (44,194,450)
Cash and cash equivalents, beginning of year 126,585 44,321,035
Cash and cash equivalents, end of year $ 77,654 $ 126,585
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 1
Year ended December 31, 2019
1. Significant Accounting Policies The Greater Vancouver Sewerage and Drainage District (the “District”) was established by an Act of the same name in 1956. Its two primary responsibilities are the collection, treatment and discharge of liquid waste for the municipalities of the Metro Vancouver Regional District (“MVRD”), and the disposal of solid waste both for the municipalities of the MVRD and the public.
The District owns and operates a number of wastewater treatment plants and a related collection network connected to the municipal collection systems, and several solid waste facilities including a waste to energy facility. Its Board of Directors comprises the same councilors and mayors as appointed to the MVRD Board by the participating municipalities. The member municipalities under the Act are jointly and severally liable for its debts.
The District’s financial statements are prepared by management in accordance with Canadian public sector accounting standards. Significant accounting policies adopted by the District are as follows:
Basis of Accounting The District follows the accrual method of accounting for revenues and expenses. Revenues are recognized in the year in which they are earned and measurable. Expenses are recognized as they are incurred and measurable as a result of receipt of goods or services and/or the legal obligation to pay.
Government Government transfers are recognized as revenue in the financial Transfers statements when the transfer is authorized and any eligibility criteria are met, except to the extent that transfer stipulations give rise to an obligation that meets the definition of a liability. The transfer of revenue is initially deferred and then recognized in the statement of operations as the stipulation liabilities are settled.
When the District is deemed the transferor, the transfer expense is recognized when the recipient is authorized and has met the eligibility criteria.
Deferred Revenue Deferred revenue represents development cost charges and a Provincial grant which have been collected, but for which the related services or obligations have yet to be performed. These amounts will be recognized as revenue in the fiscal year the services are performed or obligations and stipulations have been met.
Sinking Fund, Debt Interest income is reported as revenue in the period earned. When Retirement and required, based on external restrictions, interest income earned on Interest Income deferred revenue is added to and forms part of the deferred revenue balance and is recognized into income when related stipulations are met. Any surpluses received from upon debt retirement are recorded in the year received. Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 2
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
Cash and In order to improve cash management, the general practice of the Investments Metro Vancouver Districts is to accumulate cash and investment transactions in pooled accounts held by the MVRD. Investments held by the MVRD consist of bonds issued by governments and Canadian chartered banks, money market instruments and term deposits. Interest earned on GVS&DD’s fund balances is included in the amount owing from MVRD and is recorded as interest income in the Statement of Operations.
Employee Future Employees who provide services for the District are employees of the Benefits MVRD. Employee related costs are allocated by the MVRD to the District based on services rendered. These costs are shown as expenses in the financial statements and are included in amounts owing from MVRD.
Post‐employment benefits of the MVRD, including accumulated banked sick and vacation pay, retirement severance and Worker’s Compensation top‐up benefits for employees pursuant to certain policies and union agreements, are actuarially determined based on service and best estimates of retirement ages and expected future salary and wage increases. The obligation under these benefit plans is allocated to the District based on projected benefits as the employees render services necessary to earn the future benefits and included in amounts owing to MVRD.
Landfill Closure and The estimated present value of landfill closure and post‐closure costs is Post‐Closure recognized as a liability. This liability is recognized based on estimated Liability future expenses, including estimated inflation discounted to the current date and accrued based on the proportion of the total capacity of the landfill used as of the date of the statement of financial position. The change in this estimated liability during the year is recorded as an expense in operations. These estimates are reviewed and adjusted annually and any changes are recorded on a prospective basis.
Non‐Financial Non‐financial assets are not available to discharge existing liabilities and Assets are held for use in the provision of services. They generally have useful lives extending beyond the current year and are not intended for sale in the ordinary course of operations.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 3
Year ended December 31, 2019
1. Significant Accounting Policies (continued) Non‐Financial Assets (continued) Tangible Tangible capital assets are recorded at cost which includes amounts that Capital Assets are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value, of the tangible capital assets, except land, is amortized over their estimated useful lives. All assets are amortized on a straight line basis as follows:
Useful Life – Asset Years Infrastructure Interceptors and trunk sewers, drainage 100 Wastewater treatment, pumping stations 50 Solid Waste – incinerators, transfer stations 30 Solid Waste – landfills 25 ‐ 30 Information technology systems and networks 5 Machinery, Equipment, Furniture and Fixtures 5 ‐ 20 a. Annual amortization: Annual amortization begins when the asset is put into service and is expensed over its useful life. Assets under construction are transferred to the appropriate asset class and are amortized from the date the asset is put into productive use. b. Contributions of tangible capital assets: Contributions of tangible capital assets are recorded at their fair value at the date of receipt and as contribution revenue. c. Interest capitalization: The District does not capitalize interest costs associated with the acquisition or construction of a tangible capital asset.
Inventories of Inventories of supplies held for consumption are recorded on a first‐in‐ Supplies first‐out basis.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 4
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
Revenue Tipping fees, levies, electricity sales, permits, user fees and other revenue Recognition are recognized as revenue on an accrual basis according to the usage and rates approved and set by the Board in various fees and charges bylaws.
Segmented A segment is defined as a distinguishable activity or group of activities of Information a government for which it is appropriate to separately report financial information to achieve the objectives of the standard. Definitions of the District’s segments and their related financial information are presented in note 12.
Liability for A liability for remediation of a contaminated site is recognized when the Contaminated Sites site is no longer in productive use and the following criteria are satisfied: an environmental standard exists; contamination exceeds the standard; the District is either directly responsible or has accepted responsibility for remediation; it is expected that future economic benefits will be given up and a reasonable estimate of the liability can be made.
Use of Estimates The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts in the financial statements and the disclosure of contingent liabilities. These estimates and assumptions are based on management’s best information and judgment and may differ from actual results. Adjustments, if any, will be reflected in the financial statements in the period that the change in estimate is made, as well as in the period of settlement if the amount is different.
Significant areas requiring the use of management’s judgment relate to the determination of landfill closure and post closure liability, contaminated sites liabilities and accrued liabilities, the useful lives of tangible capital assets and the assessment of all contingencies.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 5
Year ended December 31, 2019
2. Debt Reserve Fund The Municipal Finance Authority (“MFA”) provides financing for regional districts and member municipalities. The MFA is required to establish a Debt Reserve Fund for each debenture issue equal to one‐half the average annual installment of principal and interest. The debt reserve fund is comprised of cash deposits equal to 1% of the principal amount borrowed and a non‐ interest bearing demand note for the remaining requirement. Cash deposits held by the MFA are payable with interest to the ultimate borrower when the final obligations under the respective loan agreements have been made. If, at any time, the District has insufficient funds to meet payments due on its obligations to MFA, the payments will be made from the debt reserve fund. The demand notes are callable only if there are additional requirements to be met to maintain the level of the debt reserve fund. At December 31, 2019, $23,028,014 (2018 ‐ $20,903,563) in callable demand notes were outstanding and have not been recorded in the statement of financial position.
3. Accounts Payable and Accrued Liabilities
2019 2018
Trade accounts $ 121,722,697 $ 101,354,352 Construction holdbacks 35,633,089 21,956,480 Accrued interest on debt 5,144,072 4,816,065 Other ‐ 143,432 $ 162,499,858 $ 128,270,329
4. Landfill Closure and Post‐Closure Liability The District is responsible for its share of closure and post‐closure costs at four landfill sites as detailed below.
a) The Vancouver landfill is located in Delta, BC. In accordance with an agreement with the City of Vancouver, the District is responsible for its proportionate share of the closure and post‐closure liability based on usage. The present value of the District’s estimated future liability for these expenses is recognized as the landfill site’s capacity is used and is as follows:
2019 2018
Opening Balance $ 31,709,200 $ 31,071,458 Impact due to changes in: Utilization 2,144,522 2,857,585 Assumptions (2,475,339) (2,612,058) Discount rate 1,659,623 392,215 Closing balance $ 33,038,006 $ 31,709,200 Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 6
Year ended December 31, 2019
4. Landfill Closure and Post‐Closure Liability (continued)
a) (continued) The closure and post‐closure liability and annual expense is calculated based on the ratio of actual utilization to total expected utilization of the site’s capacity at the date of closure. It is based on estimates and assumptions with respect to events extending over the remaining life of the Vancouver landfill, including provisions contained in Metro Vancouver’s Integrated Solid Waste and Resource Management Plan. The significant estimates and assumptions adopted in measuring the District’s share of the closure and post‐closure liability are as follows:
2019 2018
Current actual utilization (in tonnes) 21,139,073 20,479,845 Expected utilization at closure (in tonnes) 25,856,597 25,676,692 Expected remaining capacity (in tonnes) 4,717,524 5,196,847 Permitted capacity (in tonnes) 33,039,183 33,039,183 Proportionate share of liability 32.8% 31.5% Discount rate 2.89% 3.03% Expected post‐closure period 30 years 30 years Expected closure date December 31, 2037 December 31, 2037
b) The Cache Creek landfill is located in the Village of Cache Creek, BC. The landfill permit obligates the Village of Cache Creek and a third party service provider to undertake closure and post‐closure activities. The District, in accordance with an agreement with the Village, was required to contribute quarterly to a trust fund, held with the Province of British Columbia, to a Post Closure Maintenance and Repair Fund at rates consistent with the operational certificate for the landfill. The agreement indemnifies the Village for any post closure liabilities which are not covered by this fund. At December 31, 2019, the trust had $16,091,490 (2018 ‐ $15,768,931). The Cache Creek landfill was closed December 2016. The actual utilization at closure was 10,318,780 tonnes and the permitted capacity was 10,371,594 tonnes. The post‐closure period is expected to be 30 years. The discount rate used as at December 31, 2019 is 2.89% (2018 ‐ 3.03%). Based on this information, the present value of the District’s estimated future liability for closure and post‐closure is as follows:
2019 2018
Opening balance $ 15,768,931 $ 16,034,726 Impact due to change in: Closure costs paid ‐ (612,000) Assumptions 322,559 346,205 Closing balance 16,091,490 15,768,931 Less post‐closure fund (16,091,490) (15,768,931) Closure liability $ ‐ $ ‐ Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 7
Year ended December 31, 2019
4. Landfill Closure and Post‐Closure Liability (continued)
c) The Coquitlam and Port Mann landfills were closed in 1983 and 1997, respectively, and there are no further closure and post‐closure liabilities. 5. Deferred Revenue and Refundable Deposits The deferred revenue reported on the statement of financial position consists of the following:
2019 2018
Development cost charges (a) $ 227,551,250 $ 311,593,932 Provincial grant to fund capital expenditures (b) 153,675,034 200,367,548 Refundable deposits 1,177,525 1,294,943
Total $ 382,403,809 $ 513,256,423
a) The GVS&DD Act restricts the District to applying money raised from development cost charges to funding sewer capital projects, including the repayment of debt raised to fund such projects. The balance of these amounts is included in deferred revenue until spent on approved purposes. b) In 2018, the District received a grant from the Province of British Columbia in the amount of $193,000,000 for future costs associated with the construction of the new Lions Gate Wastewater Treatment Plant Facility. During 2019, $51,788,545, (2018 – $nil) was applied against the project.
Continuity of deferred revenue is as follows: 2019 2018 $ 513,256,423 $ 484,863,174 Balance, beginning of year 60,239,104 28,117,415 Development cost charges received Interest earned 13,203,226 10,968,234 Change in refundable deposits (117,418) 67,407 Amounts spent and recognized as revenue (204,177,526) (10,759,807) Change in deferred revenue (130,852,614) 28,393,249 Balance, end of year $ 382,403,809 $ 513,256,423
6. Debt a) All borrowings for the District are obtained from MFA by the MVRD on the District’s behalf, although the District maintains the right to finance debt without MFA involvement. Debt, debentures or other security issued by the District is a direct, joint and several obligation and liability of the District and each and every member municipality. Debt servicing requirements comprising sinking fund contributions, serial repayments and interest are funded as incurred Performanceby revenue earned during the ye and Audit Committee ar. GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 8
Year ended December 31, 2019
6. Debt (continued) b) Debt (net of sinking funds) reported on the statement of financial position comprises the following and includes varying maturities up to 2033 with interest rates ranging from 1.75% to 4.20%. Debentures Debenture debt Issue Interest authorized outstanding number rate ‐ % Maturity Date to be issued 2019 2018 Sinking fund 81 2.40 April 22, 2019$ 10,000,000 $ ‐ $ 10,000,000 99 1.75 October 19, 2021 10,000,000 10,000,000 10,000,000 104 2.90 November 20, 2023 15,000,000 15,000,000 15,000,000 106 2.25‐4.13 October 13, 2024 20,000,000 20,000,000 20,000,000 116 4.20 April 4, 2026 20,000,000 20,000,000 20,000,000 118 3.40 April 11, 2027 20,000,000 20,000,000 20,000,000 139 2.10 October 5, 2031 55,000,000 55,000,000 55,000,000 141 2.80 April 7, 2032 50,000,000 50,000,000 50,000,000 142 3.15 October 4, 2032 50,000,000 50,000,000 50,000,000 145 3.15 April 23, 2033 120,000,000 120,000,000 120,000,000 146 3.20 September 19, 2033 270,000,000 270,000,000 270,000,000 147 2.66 April 9, 2034 40,000,000 40,000,000 ‐ 149 2.24 October 9, 2034 46,000,000 46,000,000 ‐
Total debt $ 726,000,000 $ 716,000,000 $ 640,000,000 Less sinking funds (89,710,185) (63,098,945)
Total net debt $ 626,289,815 $ 576,901,055
c) Principal payments and sinking fund installments due within the next five years and thereafter are as follows:
2020 $ 38,171,706 2021 38,171,706 2022 37,672,295 2023 37,672,295 2024 36,923,178 Thereafter 303,667,465 Sub‐total 492,278,645 Estimated sinking fund income 134,011,170
Total $ 626,289,815
d) Sinking fund installments are invested by the MFA and earn income which, together with principal payments, are expected to be sufficient to retire the sinking fund debt at maturity. For sinking fund agreements, the MFA has established either a normal sinking fund or a capital repayment equalization fund.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 9
Year ended December 31, 2019
7. Tangible Capital Assets
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 10
Year ended December 31, 2019
8. Accumulated Surplus Accumulated surplus consists of individual fund surplus and reserves as follows:
2019 2018
Reserves $ 111,482,905 $ 120,833,867 Capital fund balance 103,306,665 205,267,250 Investment in tangible capital assets 1,555,949,387 1,188,730,767
Total $ 1,770,738,957 $ 1,514,831,884
Capital fund balance represents the expected level of funding required. Continuity of reserves is as follows:
Annual Contributions December 31, Operating from/ (to) Contributions December 31, 2018 Interest Surplus operations to Capital 2019
Operating Reserves Liquid Waste Services$ 21,317,995 487,609$ $ 8,901,207 $ ‐ $ (4,704,798) $ 26,002,013 Solid Waste Services 16,002,695 387,568 (14,574,837) ‐ (1,675,292) 140,134 $ 37,320,690 875,177$ $ (5,673,630) $ ‐ $ (6,380,090) $ 26,142,147
Discretionary Reserves Biosolids Inventory 14,271,801 362,981 ‐ ‐ ‐ 14,634,782 Liquid Waste General Debt Reserve Fund 2,009,228 51,101 ‐ ‐ ‐ 2,060,329 Lions Gate Contingency 1,410,080 35,863 ‐ ‐ ‐ 1,445,943 Drainage General 5,432,954 138,178 ‐ (776,000) ‐ 4,795,132 Solid Waste General 32,298,078 604,884 ‐ ‐ ‐ 32,902,962 Landfill Post‐Closure 10,699,549 272,126 ‐ ‐ ‐ 10,971,675 $ 66,121,690 1,465,133$ $ ‐ $ (776,000) $ ‐ $ 66,810,823
Statutory Reserves Liquid Waste Laboratory Equipment 573,178 15,819 ‐ 97,800 ‐ 686,797 Liquid Waste Services Sustainability Innovation Fund 16,818,309 438,413 ‐ 586,416 ‐ 17,843,138 $ 17,391,487 454,232$ $ ‐ $ 684,216 $ ‐ $ 18,529,935 Total Reserves $ 120,833,867 $ 2,794,542 $ (5,673,630) $ (91,784) $ (6,380,090) $ 111,482,905
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 11
Year ended December 31, 2019
8. Accumulated Surplus (continued)
Investment in tangible capital assets is calculated as follows:
2019 2018
Tangible capital assets $ 2,182,239,202 $ 1,765,631,822 Amounts financed by: Long‐term debt (626,289,815) (576,901,055) 1,555,949,387 1,188,730,767
Change in the investment in tangible capital assets Acquisition of tangible capital assets 449,379,197 323,048,856 Disposal of tangible capital assets (3,301,017) (276,810) Amortization of tangible capital assets (29,470,800) (29,623,721) 416,607,380 293,148,325
Less funding of tangible capital assets Sinking fund debt maturity 10,000,000 14,000,000 Sinking fund and debt retirement (34,020,281) (13,691,028) Sinking fund and debt retirement income (2,590,959) (2,490,357) Debenture debt issued 86,000,000 390,000,000 Debenture debt maturity (10,000,000) (14,000,000) 49,388,760 373,818,615
Change in investment in tangible capital assets 367,218,620 (80,670,290)
Investment in tangible capital assets, beginning of year 1,188,730,767 1,269,401,057
Investment in tangible capital assets, end of year $ 1,555,949,387 $ 1,188,730,767
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 12
Year ended December 31, 2019
9. Contractual Obligations and Rights a) Contractual Obligations i) As at December 31, 2019 the District had the following commitments outstanding related to capital projects in progress:
2019 2018
Authorized for outstanding projects $ 3,132,692,000 $ 2,630,136,377 Expended at December 31 (1,158,074,049) (852,058,128)
Commitment remaining $ 1,974,617,951 $ 1,778,078,249
ii) The District is committed under a number of lease agreements to make minimum annual payments. These agreements have varying terms, including two agreements, with annual payments of currently of $446,000 to perpetuity, with adjustments annually for CPI. Amount 2020 $ 1,947,976 2021 1,869,953 2022 1,900,870 2023 1,932,406 2024 1,964,572 2025 ‐ 2029 10,328,331 Total $ 19,944,108
b) Contractual Rights The District is party to several lease agreements that are anticipated to provide it with future revenues. These agreements are with third parties with varying terms to 2021. Amounts anticipated to be received over the future years are as follows:
Amount 2020 $ 633,760 2021 90,838 Total $ 724,598
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 13
Year ended December 31, 2019
10. Contingencies
Lawsuits As at December 31, 2019, there were various lawsuits pending against the District arising in the ordinary course of business. The District has retained legal counsel to defend against these lawsuits. Management is of the opinion that losses, if any, in connection with these lawsuits can be sufficiently funded by reserve funds or covered by insurance. Any ultimate losses will be accrued and recorded as expenses at the time the amounts are reasonably determinable.
Self Insurance A self insurance reserve has been established within the MVRD to cover Reserve losses resulting from uninsured liability exposures of the District, other Metro Vancouver Districts and the MVHC.
Each year a review is undertaken to determine if it would be beneficial to purchase additional liability insurance. The District, other Metro Vancouver Districts and the MVHC transfer amounts to the reserve depending on the reserve's adequacy to cover retained liability risk. An estimate is made for all costs of investigating and settlement of claims annually and an adjustment is made to the fund to maintain an adequate balance to cover potential losses in excess of recorded liabilities. These estimates are changed as additional information becomes known during the course of claims settlement. Any likely losses would be expensed at the time the losses are known and the amounts are reasonably determinable.
Debt Reserve The MFA is required to establish a Debt Reserve Fund for each debenture Fund which is comprised of cash deposits and a non‐interest bearing demand note (refer to note 2).
First Nations The District is currently involved in negotiations with First Nations Negotiations regarding compensation for the use of their land on which District assets reside. The compensation associated with these negotiations cannot be reasonably determined at this time and therefore no liabilities have been recorded at December 31, 2019.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 14
Year ended December 31, 2019
11. Budget Information
The annual budget presented in these financial statements is based upon the 2019 operating and capital budgets approved by the District’s Board in October 2018, with additional approval in May 2019 for adjustments to the budget as a result of the 2018 fiscal year end results. The budget is based on operational and capital expenditure requirements and their associated funding. Amortization is a non‐cash item that is not funded for budget purposes. Also, contributions to or from reserves and debt principal repayments are removed from the approved budget for financial statement presentation. The schedule below reconciles the approved budget to the budget figures reported in these financial statements. Capital expenditures of $654,060,000 were included in the capital budget approved by the Board.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 15
Year ended December 31, 2019
12. Segmented Information and Expenses by Object
The District’s primary responsibilities are the collection, treatment and discharge of liquid waste for the municipalities of the MVRD and the disposal of solid waste both for the municipalities of the MVRD and the public. For management reporting purposes, the District’s operations and activities are organized and reported by these two primary areas of service. The information reported in the segmented information does not include $10,695,038 (2018 ‐ $12,237,383) of salaries and benefits directly attributable to the construction of tangible capital assets which have been included in the cost of tangible capital assets in the Statement of Financial Position. The services disclosed in the Segmented Information are as follows:
Liquid Waste The Liquid Waste Services is responsible for the collection, treatment and Services discharge of liquid waste for member municipalities. It operates a number of wastewater treatment plants and a related collection network connected to the member municipalities’ systems.
Solid Waste The Solid Waste Services is responsible for the disposal of solid waste Services both for the member municipalities and the public. It owns and operates several solid waste facilities including a waste to energy facility.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Notes to Financial Statements, page 16
Year ended December 31, 2019
13. Subsequent Event
Subsequent to year end, the impact of COVID‐19 in Canada and on the global economy has been unprecedented. As the impacts of COVID‐19 continue, there could be further impact on the District, its members, employees, suppliers and other third party business associates that could impact the timing and amounts realized on the District’s assets and future ability to deliver services and projects. At this time, the full potential impact of COVID‐19 on the District is not known. Although the disruption from the virus is expected to be temporary, given the dynamic nature of these circumstances, the duration of disruption and the related financial impact cannot be reasonably estimated at this time. The District’s ability to continue delivering non‐essential services and employ related staff, will depend on the legislative mandates from the various levels of government. The District will continue to focus on collecting receivables, managing expenditures, and leveraging existing reserves and available credit facilities to ensure it is able to continue providing essential services to its citizens.
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Schedule 1 Schedule of Operating Fund (unaudited)
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual
Revenue Sewerage and drainage levy to members $ 255,810,755 $ 255,810,755 $ 232,134,617 Tipping fees 98,362,329 105,692,375 102,036,530 BODTSS Industrial Charges 11,022,967 11,219,515 11,265,803 Development cost charges 31,665,173 30,388,981 10,759,806 Electricity sales 5,927,304 5,793,404 5,584,341 Trucked liquid waste fees 1,096,167 1,219,798 1,157,301 Source control fees 1,207,102 1,201,837 1,357,501 User fees, recoveries and other revenue 3,508,134 5,173,321 4,511,565 408,599,931 416,499,986 368,807,464
Expenses Liquid waste 153,892,479 141,411,698 135,552,763 Transfer to Other Districts for TCAs ‐ ‐ Liquid waste 153,892,479 141,411,698 135,552,763 Solid waste 95,194,793 123,715,227 103,505,884 Corporate costs 27,431,425 27,432,182 26,510,326 Interest on long‐term debt 22,815,617 16,807,502 10,758,934 Amortization of tangible capital assets ‐ ‐ ‐ 299,334,314 309,366,609 276,327,907 Annual surplus, operating fund 109,265,617 107,133,377 92,479,557
Application of surplus and transfers Transfers from (to): Capital (78,654,181) (78,878,510) (74,875,022) Investment in non‐financial assets ‐ ‐ ‐ Sinking and debt retirement funds (34,020,226) (34,020,281) (13,691,028) Reserve funds for: Reserves ‐ Operating results (4,129,854) 5,673,630 (8,475,609) Reserves 7,538,644 91,784 4,562,102
Change in operating fund ‐ ‐ ‐
Operating fund, beginning of year ‐ ‐ ‐
Operating fund, end of year $ ‐ $ ‐ $ ‐
Performance and Audit Committee GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT Schedule 2 Schedule of Capital Fund (unaudited)
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual
Revenue Interest on debt reserve fund $ ‐ $ 164,913 $ 103,979 Develoment cost charges 122,000,000 122,000,000 ‐ Other income ‐ 20,000 500,329 Grants and contributions 101,200,000 53,975,099 5,878,448 223,200,000 176,160,012 6,482,756
Expenses Amortization of tangible capital assets 29,958,814 29,470,800 29,623,721 Loss on disposal of tangible capital asset ‐ 3,301,017 91,240 29,958,814 32,771,817 29,714,961
Annual deficit, capital fund 193,241,186 143,388,195 (23,232,205)
Tangible capital assets transactions Acquisition of tangible capital assets 654,060,000 449,379,197 323,048,856 Amortization of tangible capital assets (29,958,814) (29,470,800) (29,623,721) Disposal of tangible capital assets ‐ (3,301,017) (276,810) 624,101,186 416,607,380 293,148,325
Financing Debenture debt issued 466,101,021 86,000,000 390,000,000 Transfers from: Operating fund 78,654,181 78,878,510 74,875,022 Reserve funds 6,580,090 6,380,090 69,144,555 551,335,292 171,258,600 534,019,577
(72,765,894) (245,348,780) 240,871,252
Change in capital fund 120,475,292 (101,960,585) 217,639,047
Capital fund balance, beginning of year 205,267,250 205,267,250 (12,371,797)
Capital fund balance, end of year $ 325,742,542 $ 103,306,665 $ 205,267,250
Performance and Audit Committee
Financial Statements of
GREATER VANCOUVER WATER DISTRICT Year ended December 31, 2019
DRAFT ‐ April 3, 2020
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Index to Financial Statements
December 31, 2019
Exhibit
Independent Auditor's Report
Management Report
Statement of Financial Position A
Statement of Operations B
Statement of Change in Net Debt C
Statement of Cash Flows D
Notes to Financial Statements
Schedule
Unaudited Schedules of:
Operating Fund 1
Capital Fund 2
Performance and Audit Committee Tel: 604 688 5421 BDO Canada LLP Fax: 604 688 5132 600 Cathedral Place [email protected] 925 West Georgia Street www.bdo.ca Vancouver BC V6C 3L2 Canada
Independent Auditor’s Report
To the Members of the Board of Directors of the Greater Vancouver Water District
Opinion We have audited the financial statements of the Greater Vancouver Water District (the “District”), which comprise the Statement of Financial Position as at December 31, 2019, and the Statements of Operations, Change in Net Debt and Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the District as at December 31, 2019, and the results of its operations, change in net debt and cash flows for the year then ended in accordance with Canadian public sector accounting standards. Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the District in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the District’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the District or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the District’s financial reporting process. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: · Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detectingDRAFT a material misstatement resulting from fraud is higher than for one resulting from error,
BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. Performance and Audit Committee 1 as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. · Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. · Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. · Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the District’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the District to cease to continue as a going concern. · Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Other Matter — Supplementary Information We draw attention to the fact that the supplementary information included in Schedules 1 and 2 do not form part of the financial statements. We have not audited or reviewed this supplementary information and, accordingly, we do not express any opinion, review conclusion or any other form of assurance on this supplementary information.
Chartered Professional Accountants
Vancouver, British Columbia [DATE] DRAFT
Performance and Audit Committee 2
GREATER VANCOUVER WATER DISTRICT
MANAGEMENT REPORT
The Financial Statements contained in this report have been prepared by management in accordance with Canadian public sector accounting standards. The integrity and objectivity of these statements are management’s responsibility. Management is responsible for all the statements and schedules, and for ensuring that this information is consistent, where appropriate, with the information contained in the financial statements.
Management is also responsible for implementing and maintaining a system of internal controls to provide reasonable assurance that reliable financial information is produced.
The Greater Vancouver Water District’s Board of Directors is responsible for approving the financial statements and for ensuring that management fulfills its responsibilities for financial reporting and internal control and exercises this responsibility through the Performance and Audit Committee of the Board.
The external auditors, BDO Canada LLP, conduct an independent examination, in accordance with Canadian Auditing Standards, and express their opinion on the financial statements. Their examination does not relate to the other schedules and statements required by the Financial Information Act. The Independent Auditor’s Report outlines the scope of the audit for the year ended December 31, 2019.
On behalf of Greater Vancouver Water District.
Date: May 29, 2020 Dean Rear, Chief Financial Officer
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Exhibit A Statement of Financial Position
Year ended December 31, 2019
2019 2018
Financial Assets Cash $ 1,766,317 $ 2,954,703 Accounts receivable 61,092,957 54,366,686 Assets held for sale (note 2) ‐ 22,850,898 Due from Metro Vancouver Regional District 28,728,068 8,297,217 Debt reserve fund (note 3) 13,106,059 13,356,517 104,693,401 101,826,021 Liabilities Accounts payable and accrued liabilities (note 4) 63,631,515 27,503,471 Debt (net of sinking funds) (note 5) 558,499,412 607,491,049 622,130,927 634,994,520 Net Debt (517,437,526) (533,168,499)
Non‐Financial Assets Tangible capital assets (note 6) 2,474,114,458 2,270,688,760 Inventories of supplies 2,861,051 2,821,435 Prepaid expenses 528,445 ‐ 2,477,503,954 2,273,510,195 Accumulated surplus (note 7) $ 1,960,066,428 $ 1,740,341,696
Contractual obligations and rights (note 8) Contingencies (note 9) Subsequent event (note 12)
The accompanying notes are an integral part of these financial statements.
Chief Financial Officer
Board Chair
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Exhibit B Statement of Operations Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 10)
Revenue (note 11) Metered sale of water $ 286,908,565 $ 285,316,390 $ 274,631,383 Sinking fund and debt retirement income 15,262,141 18,446,867 23,294,180 Interest income 754,792 1,286,972 1,343,536 Building income from Metro Vancouver Districts 7,815,222 11,496,859 10,517,037 Building income from external parties 6,734,152 5,634,632 6,327,148 Other revenue 1,896,366 79,083,309 16,598,799 319,371,238 401,265,029 332,712,083
Expenses (note 11) Water operations 172,174,364 163,519,375 163,553,652 Building operations 16,140,162 18,020,922 18,287,177 188,314,526 181,540,297 181,840,829 Annual surplus 131,056,712 219,724,732 150,871,254
Accumulated surplus, beginning of year 1,740,341,696 1,740,341,696 1,589,470,442
Accumulated surplus, end of year $ 1,871,398,408 $ 1,960,066,428 $ 1,740,341,696
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Exhibit C Statement of Change in Net Debt Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 10)
Annual surplus $ 131,056,712 $ 219,724,732 $ 150,871,254
Change in tangible capital assets: Acquisition of tangible capital assets (231,400,000) (243,148,000) (72,945,127) Amortization of tangible capital assets 39,597,487 39,599,001 39,301,606 Disposal of tangible capital assets ‐ 123,301 ‐ (191,802,513) (203,425,698) (33,643,521)
Change in other non‐financial assets: Acquisition of prepaid expenses ‐ (528,445) ‐ Acquisition of inventories of supplies ‐ (2,861,051) (2,821,435) Consumption of inventories of supplies ‐ 2,821,435 2,392,897 ‐ (568,061) (428,538)
Changes in net debt (60,745,801) 15,730,973 116,799,195
Net debt, beginning of year (533,168,499) (533,168,499) (649,967,694)
Net debt, end of year $ (593,914,300) $ (517,437,526) $ (533,168,499)
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Exhibit D Statement of Cash Flows
Year ended December 31, 2019
2019 2018
Cash provided by (used in):
Operating transactions: Annual surplus $ 219,724,732 $ 150,871,254 Items not involving cash: Amortization 39,599,001 39,301,606 Sinking fund income (18,397,828) (23,252,884) Debt reserve fund income (158,291) (345,275) Gain on disposal of tangible capital assets and asset held for resale (63,025,801) ‐ Change in non‐cash assets and liabilities: Accounts receivable (6,726,271) 1,521,066 Prepaid expenses (528,445) ‐ Accounts payable and accrued liabilities 36,128,044 (8,943,579) Inventories of supplies (39,616) (428,538) Net change in cash from operating transactions 206,575,525 158,723,650
Capital transactions: Proceeds on sale of tangible capital assets and assets held for resale 86,000,000 ‐ Acquisition of tangible capital assets (243,148,000) (72,945,127) Net change in cash from capital transactions (157,148,000) (72,945,127)
Financing transactions: Due from Metro Vancouver Regional District (20,430,851) (27,391,963) Debenture debt issued 22,000,000 ‐ Debt reserve fund issuance (220,000) ‐ Debt reserve fund maturity 628,749 3,565,524 Sinking fund payments (52,593,809) (64,478,143) Net change in cash from financing transactions (50,615,911) (88,304,582)
Net change in cash and cash equivalents (1,188,386) (2,526,059)
Cash and cash equivalents, beginning of year 2,954,703 5,480,762
Cash and cash equivalents, end of year $ 1,766,317 $ 2,954,703
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 1
Year ended December 31, 2019
1. Significant Accounting Policies The Greater Vancouver Water District (the “District”) was established by an Act of the same name in 1924. Its primary responsibility is the supply of potable water to its member municipalities. Its Board of Directors comprises the same councillors and mayors as appointed to the Metro Vancouver Regional District (“MVRD”) Board by the participating municipalities. The District owns or holds under a 999‐year lease from the Province an extensive closed watershed network as its source of supply. It owns a series of dams, reservoirs, water treatment plants and a distribution network connecting to the municipal distribution systems. The member municipalities under the Act are jointly and severally liable for its debts. The District also owns and is responsible for operating and maintaining office buildings that are leased to MVRD and its related entities. The District’s financial statements are prepared by management in accordance with Canadian public sector accounting standards (“PSAS”). Significant accounting policies adopted by the District are as follows:
Basis of Accounting The District follows the accrual method of accounting for revenues and expenses. Revenues are recognized in the year in which they are earned and measurable. Expenses are recognized as they are incurred and measurable as a result of the receipt of goods or services and/or the legal obligation to pay.
Government Government transfers are recognized as revenue in the financial Transfers statements when the transfer is authorized and any eligibility criteria are met, except to the extent that transfer stipulations give rise to an obligation that meets the definition of a liability. The transfer of revenue is initially deferred and then recognized in the statement of operations as the stipulation liabilities are settled.
When the District is deemed the transferor, the transfer expense is recognized when the recipient is authorized and has met the eligibility criteria.
Sinking Fund, Debt Interest income is reported as revenue in the period earned. When Retirement and required, based on external restrictions, interest income earned on Interest Income deferred revenue is added to and forms part of the deferred revenue balance and is recognized into income when related stipulations are met. Any surpluses received from upon debt retirement are recorded in the year received.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 2
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
Cash and In order to improve cash management, the general practice of the Investments Metro Vancouver Districts is to accumulate cash and investment transactions in pooled accounts held by the MVRD. Investments held by the MVRD consist of bonds issued by governments and Canadian chartered banks, money market instruments and term deposits. Interest earned on GVWD’s fund balances is included in the amount owing from the MVRD and is recorded as interest income in the Statement of Operations.
Employee Future Employees who provide services for the District are employees of the Benefits MVRD. Employee related costs are allocated by the MVRD to the District based on services rendered. These costs are shown as expenses in the financial statements and are included in amounts owing to MVRD.
Post‐employment benefits of the MVRD, including accumulated banked sick and vacation pay, retirement severance and Worker’s Compensation top‐up benefits for employees pursuant to certain policies and union agreements, are actuarially determined based on service and best estimates of retirement ages and expected future salary and wage increases. The obligation under these benefit plans is allocated to the District based on projected benefits as the employees render services necessary to earn the future benefits and included in amounts owing to MVRD.
Non‐Financial Non‐financial assets are not available to discharge existing liabilities Assets and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the ordinary course of operations.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 3
Year ended December 31, 2019
1. Significant Accounting Policies (continued) Non‐Financial Assets (continued) Tangible Tangible capital assets are recorded at cost which includes amounts Capital Assets that are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value, of the tangible capital assets, excluding land, is amortized on a straight line basis over the estimated useful lives of the assets as follows:
Useful Life Asset Years Buildings Corporate head office 40 Watershed 25 Infrastructure Dams and reservoirs 150 Supply mains 100 Distribution systems, drinking water treatment 50 Bridges and roads 50 Vehicles 5 ‐ 10 Machinery, Equipment, Furniture and Fixtures 5 ‐ 20
a. Annual amortization: Annual amortization begins when the asset is put into service and is expensed over its useful life. Assets under construction are transferred to the appropriate asset class and are amortized from the date the asset is put into productive use. b. Contributions of tangible capital assets: Contributions of tangible capital assets are recorded at their fair value at the date of receipt and as contribution revenue. c. Interest capitalization: The District does not capitalize interest costs associated with the acquisition or construction of a tangible capital asset.
Inventories of Inventories of supplies held for consumption are recorded on a first‐ Supplies in‐first‐out basis.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 4
Year ended December 31, 2019
1. Significant Accounting Policies (continued)
Revenue Metered sale of water, building income from external tenants, Metro Recognition Vancouver Districts and Housing Corporation, and other income are recognized as revenue on an accrual basis according to the usage and rates approved and set by the Board.
Use of Estimates The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts in the financial statements and the disclosure of contingent liabilities. These estimates and assumptions are based on management’s best information and judgment and may differ from actual results. Adjustments, if any, will be reflected in the financial statements in the period that the change in estimate is made, as well as in the period of settlement if the amount is different.
Significant areas requiring the use of management’s judgment relates to the determination of accrued liabilities and contaminated sites liabilities, the amortization rates of tangible capital assets and the assessment of all contingencies.
Segmented A segment is defined as a distinguishable activity or group of activities Information of a government for which it is appropriate to separately report financial information to achieve the objectives of the standard. Definitions of the District’s segments and their related financial information are presented in note 11.
Liabilities for A liability for remediation of a contaminated site is recognized when Contaminated Sites the site is no longer in productive use and the following criteria are satisfied: an environmental standard exists; contamination exceeds the standard; the District is either directly responsible or has accepted responsibility for remediation; it is expected that future economic benefits will be given up and a reasonable estimate of the liability can be made. Liabilities for contaminated sites are reported in accounts payable and accrued liabilities (note 4).
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 5
Year ended December 31, 2019
2. Assets Held for Sale Head office operations for MVRD and its related Districts were relocated in 2017 and the former head office buildings were made available for sale. On March 12, 2019, the land and buildings were sold, resulting in a gain, net of book value, of $63.15 million.
3. Debt Reserve Fund The Municipal Finance Authority (“MFA”) provides financing for regional districts and member municipalities. The MFA is required to establish a Debt Reserve Fund for each debenture issue equal to one‐half the average annual installment of principal and interest. The debt reserve fund is comprised of cash deposits equal to 1% of the principal amount borrowed and a non‐ interest bearing demand note for the remaining requirement. Cash deposits held by the MFA are payable with interest to the ultimate borrower when the final obligations under the respective loan agreements have been made. If, at any time, the District has insufficient funds to meet payments due on its obligations to MFA, the payments will be made from the debt reserve fund. The demand notes are callable only if there are additional requirements to be met in order to maintain the level of the debt reserve fund. At December 31, 2019, $34,795,270 (2018 ‐ $35,939,529) in callable demand notes were outstanding and have not been recorded in the statement of financial position.
4. Accounts Payable and Accrued Liabilities
2019 2018
Trade accounts $ 41,339,251 $ 15,145,508 Construction holdbacks 15,927,876 3,354,956 Accrued interest on debt 6,099,978 6,521,616 Contaminated sites (a) 245,079 2,255,050 Other 19,331 226,341 $ 63,631,515 $ 27,503,471
a) The District has accrued $245,079 (2018 ‐ $2,255,050) for work undertaken to remediate contaminated soils at one of its properties. The remediation work at this site is underway and expected to be complete in 2020.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 6
Year ended December 31, 2019
5. Debt a) All borrowings for the District are obtained from MFA by the MVRD on the District’s behalf, although the District maintains the right to finance debt without MFA involvement. Debt, debentures or other security issued by the District is a direct, joint and several obligation and liability of the District and each and every member municipality. Debt servicing requirements comprising sinking fund contributions, serial repayments and interest are funded as incurred by revenue earned during the year.
b) Principal payments and sinking fund installments due within the next five years and thereafter are as follows:
Total Payments
2020 $ 51,574,488 2021 51,381,233 2022 48,384,767 2023 43,907,313 2024 40,130,221 Thereafter 152,194,462 Subtotal 387,572,484 Estimated sinking fund income 170,926,928 Total $ 558,499,412
c) Sinking fund installments are invested by the MFA and earn income that, together with principal payments, are expected to be sufficient to retire the sinking fund debt at maturity. For sinking fund agreements, the MFA has established either a normal sinking fund or a capital repayment equalization fund.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 7
Year ended December 31, 2019
5. Debt (continued) d) Debt (net of sinking funds) reported on the Statement of Financial Position comprises the following and includes varying maturities up to 2034 with interest rates ranging from 2.00% to 4.66%.
Debentures Debenture debt Issue By‐law Interest Maturity authorized outstanding number number rate ‐ % date to be issued 2019 2018 Sinking fund 71A 813 4.43 November 5, 2022$ 14,294,000 $ 14,294,000 $ 14,294,000 71B 853 4.43 November 5, 2022 706,000 706,000 706,000 79 BB 946 2.40 April 22, 2019 8,548,000 ‐ 8,548,000 79C 946 2.40 April 22, 2019 1,972,000 ‐ 1,972,000 80 946 2.00 December 02, 2019 37,000,000 ‐ 37,000,000 81 946 4.17 October 13, 2020 3,600,000 3,600,000 3,600,000 82 946 4.66 April 19, 2021 15,630,930 15,630,930 15,630,930 82 994 4.66 April 19, 2021 4,369,070 4,369,070 4,369,070 83 994 4.43 October 19, 2021 40,000,000 40,000,000 40,000,000 84 994 2.25 December 1, 2022 80,000,000 80,000,000 80,000,000 85 994 2.60 April 23, 2023 40,000,000 40,000,000 40,000,000 86 994 2.90 November 20, 2023 35,630,930 35,630,930 35,630,930 87 1073 2.25 June 3, 2024 60,000,000 60,000,000 60,000,000 88 1073 2.25 October 13, 2024 80,000,000 80,000,000 80,000,000 89 1073 4.50 April 8, 2025 50,000,000 50,000,000 50,000,000 90 1073 3.73 October 6, 2025 70,000,000 70,000,000 70,000,000 91 1073 4.20 April 4, 2026 30,000,000 30,000,000 30,000,000 92 1073 3.40 April 11, 2027 70,000,000 70,000,000 70,000,000 93 1073 2.90 October 4, 2027 20,000,000 20,000,000 20,000,000 94 1073 3.85 September 26, 2028 70,000,000 70,000,000 70,000,000 95 1073 3.30 April 7, 2029 60,000,000 60,000,000 60,000,000 96 1073 3.00 October 14, 2029 50,000,000 50,000,000 50,000,000 97 1073 2.20 April 8, 2030 60,000,000 60,000,000 60,000,000 98 1073 2.60 April 19, 2031 80,000,000 80,000,000 80,000,000 98 1224 2.60 April 19, 2031 20,000,000 20,000,000 20,000,000 99 1224 2.80 April 7, 2032 50,000,000 50,000,000 50,000,000 147 1224 2.66 April 9, 2034 22,000,000 22,000,000 ‐ Debt (excluding related to assets held for sale) $ 1,058,750,930 $ 1,026,230,930 $ 1,051,750,930 Less sinking funds (467,731,518) (444,259,881)
Total debt (net of sinking funds) $ 558,499,412 $ 607,491,049
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 8
Year ended December 31, 2019
6. Tangible Capital Assets
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 9
Year ended December 31, 2019
7. Accumulated Surplus
Accumulated surplus consists of individual fund surplus and reserves as follows:
2019 2018
Reserves $ 38,105,740 $ 46,371,607 Capital fund balance 6,345,642 30,772,378 Investment in tangible capital assets 1,915,615,046 1,663,197,711
Accumulated surplus, end of year $ 1,960,066,428 $ 1,740,341,696 Capital fund balance represents the expected level of funding required.
Continuity of reserves is as follows:
Annual Contributions December 31, Operating from / (to) Contributions December 31, 2018 Interest Surplus operations to capital 2019
Designated reserves Sustainability innovation fund $ 12,139,492 $ 315,591 $ ‐ $ 666,411 $ ‐ $ 13,121,494 Laboratory equipment 628,460 16,568 ‐ 46,000 ‐ 691,028 12,767,952 332,159 ‐ 712,411 ‐ 13,812,522
Non‐designated reserves Operating reserve 33,603,655 670,561 5,909,703 (21,909) (15,868,792) 24,293,218
Total reserves $ 46,371,607 $ 1,002,720 $ 5,909,703 $ 690,502 $ (15,868,792) $ 38,105,740
Investment in tangible capital assets is calculated as follows:
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 10
Year ended December 31, 2019
7. Accumulated Surplus (continued) The change in the investment in tangible capital assets is as follows:
8. Contractual Obligations and Rights a) Contractual Obligations: i) As at December 31, 2019, the District had the following commitments outstanding related to capital projects in progress: 2019 2018
Authorized for outstanding projects $ 1,676,775,000 $ 1,521,400,000 Expended at December 31 (690,929,000) (541,687,000)
Commitment remaining $ 985,846,000 $ 979,713,000
ii) The District is committed under a number of lease agreements to make minimum annual payments. These agreements have varying terms, including one agreement with annual payments of $103,000 to perpetuity, with adjustments annually for CPI.
Amount 2020 $ 383,611 2021 383,611 2022 219,921 2023 103,000 2024 – 2029 515,000 Total $ 1,708,143 Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 11
Year ended December 31, 2019
8. Contractual Obligations and Rights (continued) b) Contractual Rights: The District is party to several agreements that are anticipated to provide it with future revenues. These agreements are with third parties with varying terms to 2027. Amounts anticipated to be received over the future years are as follows:
Amount 2020 $ 6,116,236 2021 6,512,611 2022 6,303,172 2023 6,344,695 2024 6,377,991 Thereafter 18,891,399 Total $ 50,546,104
9. Contingencies
Lawsuits: As at December 31, 2019, there were various lawsuits pending against the District arising in the ordinary course of business. The District has retained legal counsel to defend against these lawsuits for which the outcomes are not possible to reasonably determine at this time and therefore no accrual has been recognized. Management is of the opinion that the losses, if any, in connection with these lawsuits can be sufficiently funded by reserve funds or covered by insurance. Any ultimate losses are recorded as expenses at the time the amounts are reasonably determinable.
Self Insurance A self insurance reserve has been established within the MVRD to Reserve: cover losses resulting from uninsured liability exposures of the District, other MVRD Districts and Housing Corporation.
Each year a review is undertaken to determine if it would be beneficial to purchase additional liability insurance. The District, other Metro Vancouver Districts and the MVHC transfer amounts to the reserve depending on the reserve’s adequacy to cover retained liability risk.
An estimate is made for all costs of investigating and settlement of claims annually and an adjustment is made to the fund to maintain an adequate balance to cover potential losses in excess of recorded liabilities. These estimates are changed as additional information becomes known during the course of claims settlement. Any likely losses would be expensed at the time the losses are known and the amounts are reasonably determinable. Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 12
Year ended December 31, 2019
9. Contingencies (continued)
Debt Reserve Fund: The MFA is required to establish a Debt Reserve Fund for each debenture which is comprised of cash deposits and a non‐interest bearing demand note (refer to note 3). If, at any time, the District has insufficient funds to meet payments due on its obligations to MFA, the payments will be made from the debt reserve fund. The demand notes are callable only if there are additional requirements to be met to maintain the level of the debt reserve fund, and therefore have not been recorded in the statement of financial position.
10. Budget Information The annual budget presented in these financial statements is based upon the 2019 operating and capital budgets approved by the District’s Board in October 2018, with additional approval in May 2019 for adjustments to the budget as a result of the 2018 fiscal year end results. The budget is based on operational and capital expenditure requirements and their associated funding. Amortization is a non‐cash item that is not funded for budget purposes. Also, contributions to or from reserves and debt principal repayments are removed from the approved budget for financial statement presentation. The schedule below reconciles the approved operating budget to the budget figures reported in these financial statements. Capital expenditures of $231,400,000 were included in the capital budget approved by the Board.
2019 2018 Budget Budget
Budgeted annual surplus per Exhibit B ‐ Statement of Operations $ 131,056,712 $ 111,833,613
Additional transfers from reserves, approved by Board 1,350,000 1,400,000
Adjusted annual surplus, based on October approved budget 132,406,712 113,233,613
Items not included in the operating budget Amortization of tangible capital assets 39,597,487 39,145,652 Sinking and debt retirement fund income (15,262,141) (18,289,066) Reserve interest (754,792) (812,368)
Items included in the budget but not in financial statements Debt principal payments (52,593,809) (64,478,143) Transfers to capital (103,143,631) (68,492,220) Transfers from reserve funds 519,174 461,532 Transfers to reserve funds (769,000) (769,000)
Annual surplus per approved budget $ ‐ $ ‐
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 13
Year ended December 31, 2019
11. Segmented Information and Expenses by Object
The District’s primary responsibilities are the supply of potable water to the municipalities of he MVRD and the property management of the office buildings owned by the District. For management reporting purposes, the District’s operations and activities are organized and reported by these two primary areas of service. The information reported in the segmented information does not include $13,603,653 (2018 ‐ $10,418,096) of salaries and benefits directly attributable to the construction of tangible capital assets which have been included in the cost of tangible capital assets in the Statement of Financial Position. The services disclosed in the Segmented Information are as follows:
Water Operations Water Operations is responsible for the supply of potable water to the District’s member municipalities. The District owns a series of dams, reservoirs, water treatment plants and a distribution network connected to the member municipalities’ systems.
Building Operations Building Operations is responsible for operating and maintaining office buildings owned by the District. These facilities are leased to MVRD and its related entities for its head office operations as well as to external parties.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Notes to Financial Statements, page 14
Year ended December 31, 2019
12. Subsequent Event
Subsequent to year end, the impact of COVID‐19 in Canada and on the global economy has been unprecedented. As the impacts of COVID‐19 continue, there could be further impact on the District, its members, employees, suppliers and other third party business associates that could impact the timing and amounts realized on the District’s assets and future ability to deliver services and projects. At this time, the full potential impact of COVID‐19 on the District is not known. Although the disruption from the virus is expected to be temporary, given the dynamic nature of these circumstances, the duration of disruption and the related financial impact cannot be reasonably estimated at this time. The District’s ability to continue delivering non‐essential services and employ related staff, will depend on the legislative mandates from the various levels of government. The District will continue to focus on collecting receivables, managing expenditures, and leveraging existing reserves and available credit facilities to ensure it is able to continue providing essential services to its citizens.
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Schedule 1 Schedule of Operating Fund (unaudited)
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual
Revenue Metered sale of water $ 286,908,565 $ 285,316,390 $ 274,631,383 Building income from Metro Vancouver Districts 7,815,222 11,496,859 10,051,400 Building income from external parties 6,734,152 5,634,633 6,327,148 Other income 1,896,366 2,533,440 2,278,129 303,354,305 304,981,322 293,288,060
Expenses Water Operations: Water operations and maintenance 65,558,845 63,274,105 56,860,385 Watershed operations 12,691,419 12,273,888 12,108,527 Water policy and planning 5,021,807 3,403,472 3,779,724 Administration 6,947,911 5,778,458 5,458,369 Interest on long‐term debt 28,443,105 25,746,101 31,990,458 118,663,087 110,476,024 110,197,463
Corporate costs: Head Office building operations 12,855,949 13,238,671 12,925,460 Head Office building capital maintenance 2,370,000 ‐ ‐ Transfer to Other Districts (3,867,015) ‐ 651,356 Other corporate costs 18,695,018 18,226,601 18,764,944 30,053,952 31,465,272 32,341,760 148,717,039 141,941,296 142,539,223
Annual surplus, operating fund 154,637,266 163,040,026 150,748,837
Application of surplus and transfers Transfers from (to): Capital (103,143,631) (103,846,012) (69,260,566) Sinking and debt retirement funds (52,593,809) (52,593,809) (64,478,143) Reserve funds for: Reserves ‐ Operating results ‐ (5,909,703) (16,557,153) Reserves 1,100,174 (690,502) (452,975) (154,637,266) (163,040,026) (150,748,837)
Change in operating fund ‐ ‐ ‐
Operating fund, beginning of year ‐ ‐ ‐ Operating fund, end of year $ ‐ $ ‐ $ ‐
Performance and Audit Committee GREATER VANCOUVER WATER DISTRICT Schedule 2 Schedule of Capital Fund (unaudited)
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual
Revenue Net gain on disposal of tangible capital assets $ ‐ $ 63,149,102 $ ‐ Other income ‐ 13,573,106 14,827,603 Interest income ‐ 284,252 478,979 ‐ 77,006,460 15,306,582
Expenses Amortization of tangible capital assets 39,597,487 39,599,001 39,301,606 Loss on disposal of tangible capital asset ‐ 123,301 ‐ 39,597,487 39,722,302 39,301,606
Annual deficit, capital fund (39,597,487) 37,284,158 (23,995,024)
Tangible capital assets transactions Acquisition of tangible capital assets 231,400,000 243,148,000 72,945,127 Amortization of tangible capital assets (39,597,487) (39,599,001) (39,301,606) Disposal of tangible capital assets ‐ (123,301) ‐ 191,802,513 203,425,698 33,643,521
Financing Debenture debt issued 112,387,577 22,000,000 ‐ Transfers from: Operating fund 103,143,631 103,846,012 69,260,566 Reserve funds 15,868,792 15,868,792 24,428,770 231,400,000 141,714,804 93,689,336
39,597,487 (61,710,894) 60,045,815 Change in capital fund ‐ (24,426,736) 36,050,791
Capital fund balance, beginning of year 30,772,378 30,772,378 (5,278,413)
Capital fund balance, end of year $ 30,772,378 $ 6,345,642 $ 30,772,378
Performance and Audit Committee
Financial Statements of
METRO VANCOUVER HOUSING CORPORATION Year ended December 31, 2019
DRAFT ‐ April 3, 2020
Performance and Audit Committee
METRO VANCOUVER HOUSING CORPORATION Index to Financial Statements
December 31, 2019
Exhibit
Independent Auditor’s Report Management Report Statement of Financial Position A Statement of Operations B Statement of Change in Net Debt C Statement of Cash Flows D Notes to Financial Statements
Schedule
Unaudited Schedules of: Operating Fund 1 Capital Funds 2
Performance and Audit Committee Tel: 604 688 5421 BDO Canada LLP Fax: 604 688 5132 600 Cathedral Place [email protected] 925 West Georgia Street www.bdo.ca Vancouver BC V6C 3L2 Canada
Independent Auditor’s Report
To the Members of the Board of Directors of the Metro Vancouver Housing Corporation
Opinion We have audited the financial statements of the Metro Vancouver Housing Corporation (the “Corporation”), which comprise the Statement of Financial Position as at December 31, 2019, and the Statements of Operations, Change in Net Debt and Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Corporation as at December 31, 2019, and the results of its operations, change in net debt and cash flows for the year then ended in accordance with Canadian public sector accounting standards. Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Corporation in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the Corporation’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Corporation or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Corporation’s financial reporting process. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: · Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidenceDRAFT that is sufficient and appropriate to provide a basis for our opinion. The risk of not
BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. Performance and Audit Committee 1 detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. · Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Corporation’s internal control. · Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. · Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Corporation’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Corporation to cease to continue as a going concern. · Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Other Matter — Supplementary Information We draw attention to the fact that the supplementary information included in Schedules 1 and 2 do not form part of the financial statements. We have not audited or reviewed this supplementary information and, accordingly, we do not express any opinion, review conclusion or any other form of assurance on this supplementary information.
Chartered Professional Accountants
Vancouver, British Columbia [DATE] DRAFT
Performance and Audit Committee 2
METRO VANCOUVER HOUSING CORPORATION (“MVHC”)
MANAGEMENT REPORT
The Financial Statements contained in this report have been prepared by management in accordance with Canadian public sector accounting standards and the integrity and objectivity of these statements are management’s responsibility. Management is responsible for all the statements and schedules, and for ensuring that this information is consistent, where appropriate, with the information contained in the financial statements.
Management is also responsible for implementing and maintaining a system of internal controls to provide reasonable assurance that reliable financial information is produced. The Board of Directors is responsible for approving the financial statements and for ensuring that management fulfills its responsibilities for financial reporting and internal control.
The external auditors, BDO Canada LLP, conduct an independent examination, in accordance with Canadian Auditing Standards, and express their opinion on the financial statements. Their examination does not relate to the other schedules and statements required by the Financial Information Act. The Independent Auditor’s Report outlines the scope of the audit for the year ended December 31, 2019.
On behalf of Metro Vancouver Housing Corporation.
Date: May 29, 2020 Dean Rear, Chief Financial Officer
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Exhibit A Statement of Financial Position
Year ended December 31, 2019
2019 2018
Financial Assets Accounts receivable $ 417,096 $ 499,609 Due from Metro Vancouver Regional District 37,391,353 42,958,448 37,808,449 43,458,057 Liabilities Accounts payable and accrued liabilities (note 3) 6,597,248 3,551,574 Deferred revenue and refundable deposits (note 4) 17,746,234 15,736,071 Forgivable loan (note 5) 6,685,520 5,137,797 Mortgages and debentures payable (note 6) 48,451,858 53,130,437 79,480,860 77,555,879
Net Debt (41,672,411) (34,097,822)
Non-Financial Assets Tangible capital assets (note 7) 98,886,538 85,462,196 Prepaid land leases (note 8) 5,451,900 5,646,699 Prepaid expenses 663,092 444,294 105,001,530 91,553,189 Accumulated surplus (note 9) $ 63,329,119 $ 57,455,367
Contingencies (note 10) Subsequent event (note 12)
The accompanying notes are an integral part of these financial statements.
Director
Director
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Exhibit B Statement of Operations Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 11)
Revenue Property rental $ 39,309,579 $ 40,869,815 $ 39,904,174 Contributions: Canada Mortgage and Housing Corporation 5,520 355,854 826,776 British Columbia Housing Management Commission 1,083,034 1,710,361 1,174,378 Restricted contributions (48,907) (1,875,363) (7,242,460) Interest income 299,682 1,120,155 853,366 Other revenues 870,086 784,099 769,146 41,518,994 42,964,921 36,285,380
Expenses Asset repairs and maintenance 18,647,769 17,323,375 11,611,930 Amortization of tangible assets and prepaid land leases 2,074,950 2,303,206 3,084,600 Utilities, permits and taxes 6,123,191 6,401,118 5,691,582 Salaries and benefits 5,892,652 5,855,266 5,559,199 Interest and fees on long‐term debt 1,522,971 1,506,564 1,661,148 Corporate costs 2,119,752 2,076,090 2,059,225 Consulting, contracted and professional services 758,568 634,742 526,729 Other 918,841 743,902 675,107 Materials and supplies 142,534 246,906 210,779 38,201,228 37,091,169 31,080,299
Annual surplus 3,317,766 5,873,752 5,205,081
Accumulated surplus, beginning of year 57,455,367 57,455,367 52,250,286
Accumulated surplus, end of year $ 60,773,133 $ 63,329,119 $ 57,455,367
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Exhibit C Statement of Change in Net Debt Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual (note 11)
Annual surplus $ 3,317,766 $ 5,873,752 $ 5,205,081
Change in tangible capital assets Acquisition of tangible capital assets (21,317,000) (15,532,749) (7,734,166) Amortization of tangible capital assets 2,074,950 2,108,407 2,889,801 (19,242,050) (13,424,342) (4,844,365)
Change in other non‐financial assets Payment of prepaid expenses ‐ (663,092) (444,294) Use of prepaid expenses ‐ 444,294 435,899 Amortization of prepaid land leases ‐ 194,799 194,799 ‐ (23,999) 186,404 Change in net debt (15,924,284) (7,574,589) 547,120
Net debt, beginning of year (34,097,822) (34,097,822) (34,644,942)
Net debt, end of year $ (50,022,106) $ (41,672,411) $ (34,097,822)
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Exhibit D Statement of Cash Flows
Year ended December 31, 2019
2019 2018
Cash provided by (used in):
Operating transactions: Annual surplus $ 5,873,752 $ 5,205,081 Items not involving cash Amortization of tangible capital assets 2,108,407 2,889,801 Amortization of prepaid land leases 194,799 194,799 Change in non‐cash assets and liabilities Accounts receivable 82,513 (130,557) Accounts payable and accrued liabilities 3,045,674 560,799 Deferred revenue and refundable deposits 2,010,163 7,087,033 Prepaid expenses (218,798) (8,395) Net change in cash from operating transactions 13,096,510 15,798,561
Capital transactions: Acquisition of tangible capital assets (15,532,749) (7,734,166)
Financing transactions: Due from Metro Vancouver Regional District 5,567,095 (6,684,229) Forgivable loan issued 1,547,723 5,137,797 Principal repayments on mortgages and debentures (4,678,579) (6,517,963) Net change in cash from financing transactions 2,436,239 (8,064,395)
Net change in cash and cash equivalents ‐ ‐
Cash and cash equivalents, beginning of year ‐ ‐
Cash and cash equivalents, end of year $‐ $ ‐
The accompanying notes are an integral part of these financial statements.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 1
Year ended December 31, 2019
1. Significant Accounting Policies The Metro Vancouver Housing Corporation (“MVHC” or the “Corporation”) is a wholly‐owned subsidiary of the Metro Vancouver Regional District (“MVRD”). The MVHC is incorporated under the Business Corporations Act (British Columbia) as a not‐for‐ profit corporation for the purpose of supplying public rental accommodation, and is exempt from income taxes. The Corporation’s financial statements are prepared by management in accordance with Canadian public sector accounting standards (“PSAS”). Significant accounting policies adopted by the MVHC are as follows:
Basis of Accounting The Corporation follows the accrual method of accounting for revenue and expenses. Revenue is recognized in the year in which they are earned and measurable. Expenses are recognized as they are incurred and measurable as a result of the receipt of goods or services and/or the legal obligation to pay. Government Government transfers are recognized as revenue in the financial Transfers statements when the transfer is authorized and any eligibility criteria are met, except to the extent that transfer stipulations give rise to an obligation that meets the definition of a liability. The transfer of revenue is initially deferred and then recognized in the statement of operations as the stipulation liabilities are settled. When the Corporation is deemed the transferor, the transfer expense is recognized when the recipient is authorized and has met the eligibility criteria. Deferred Revenue Deferred revenues represent tenant security deposits, restricted and Refundable contributions and revenues, and rental income which have been Deposits collected, but which the related services or obligations have yet to be performed. These amounts will be recognized as revenues in the fiscal year the services are performed or obligations have been met. Amounts received under the following programs have been recorded as deferred revenue: i) Section 95 Rental Subsidy: Pursuant to Section 95 of the National Housing Act ("NHA"), a portion of the funds received from rental operations to a cumulative maximum of $500 per unit, are restricted and can only be used by MVHC according to the terms of the agreement with BCHMC. The amounts are recorded as deferred revenue and used when expenditures exceed revenue in the program.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 2
Year ended December 31, 2019
1. Significant Accounting Policies (continued) Deferred Revenue ii) Replacement Projects: Under operating agreements entered into and Refundable with Canada Mortgage and Housing Corporation (“CMHC”) and Deposits administered by BCHMC, a portion of the funds received from rental (continued) operations are restricted for the replacement of equipment and specified building components. These funds are deferred until spent on approved items. In accordance with the original CMHC agreements (Section 95), from the inception of a project, a maximum of 1% per annum of the original construction cost of the building is restricted and recorded as deferred revenue. With the administrative approval of BCHMC, the potential of restricted contributions may be adjusted from time to time based on an asset life cycle analysis. Expenditures funded from deferred revenue are periodically reviewed by BCHMC, and are restricted to the replacement of equipment and specified building components. In accordance with BCHMC agreements (Homes BC and Seniors project), any receipts in excess of expenses are restricted for approved projected capital repairs and replacements for each project. These revenues are deferred until spent on approved items.
Interest Income Interest income is reported as revenue in the period earned. When required, based on external requirements, interest income earned on deferred revenue and refundable deposits is added to and forms part of the deferred revenue and refundable deposit balance.
Cash and In order to improve cash management, the general practice of the Metro Investments Vancouver Districts and MVHC is to accumulate cash and investment transactions in pooled accounts held by the MVRD. Investments held by the MVRD consist of bonds issued by governments and Canadian chartered banks, money market instruments, guaranteed investment certificates and term deposits. Interest earned on MVHC’s fund balances is included in the amount owing from MVRD and is recorded as interest income in the Statement of Operations.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 3
Year ended December 31, 2019
1. Significant Accounting Policies (continued) Employee Future Employees who provide services for MVHC are employees of the MVRD. Benefits Employee related costs are allocated by the MVRD to MVHC based on services rendered. These costs are shown as expenses in the financial statements and are included in amounts owing from MVRD. Post‐employment benefits of the MVRD, including accumulated banked sick and vacation pay, retirement severance and Worker’s Compensation top‐up benefits for employees pursuant to certain policies and union agreements, are actuarially determined based on service and best estimates of retirement ages and expected future salary and wage increases. The obligation under these benefit plans is allocated to MVHC based on projected benefits as the employees render services necessary to earn the future benefits and included in amounts owing to the MVRD.
Non‐financial assets Non‐financial assets are not available to discharge existing liabilities and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the ordinary course of operations. Tangible Tangible capital assets are recorded at cost, which includes amounts that Capital Assets are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value, of the tangible capital assets, excluding land, is amortized on a straight‐line basis over the estimated useful lives of the assets as follows:
Asset Useful Life ‐ Years Buildings Manor House and Regal Hotel 25 Other buildings 35 Furniture and fixtures 6 ‐ 10 1) Annual amortization: Annual amortization begins when the asset is put into service and is expensed over its useful life. Assets under construction are transferred to the appropriate asset class and are amortized from the date the asset is put into productive use. 2) Interest capitalization: The MVHC capitalizes, at cost, all housing rental property expenditures, including interest and property taxes incurred to the date of completion of the project.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 4
Year ended December 31, 2019
1. Significant Accounting policies (continued) Non‐financial assets (continued) Prepaid Land Prepaid land leases are recorded at historical cost less accumulated Leases amortization. Upon expiration of the lease contract, the property will revert to the lessor. Prepaid land leases are amortized on a straight‐line basis over the lease term.
Financial Financial instruments are recorded at fair value on initial recognition. Instruments Unrealized changes in fair value are recognized in the Statement of Remeasurement Gains and Losses until they are realized, when they are transferred to the Statement of Operations. Financial instruments are adjusted by transaction costs incurred on acquisition and financing costs, which are amortized using the straight‐ line method. All financial assets are assessed for impairment on an annual basis. When a decline is determined to be other than temporary, the amount of the loss is reported in the statement of operations and any unrealized gain is adjusted through the Statement of Remeasurement Gains and Losses. When the asset is sold, the unrealized gains and losses previously recognized in the Statement of Remeasurement Gains and Losses are reversed and recognized in the Statement of Operations. There are no financial instruments carried at fair value as at year end and as a result, the Statement of Remeasurement Gains and Losses has not been prepared. Functional and A segment is defined as a distinguishable activity or group of activities of Segmented a government for which it is appropriate to separately report financial Presentation of information to achieve the objectives of the standard. Management Revenue and believes that MVHC’s activities are comprised of only one segment and Expenses hence no additional disclosure is required. Furthermore, as the operations of MVHC are comprised of a single function, supply of public rental accommodation, the Statement of Operations presents revenue and expenses by object.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 5
Year ended December 31, 2019
1. Significant Accounting Policies (continued) Revenue Property rental income, contributions and other revenues are recognized Recognition as revenue on an accrual basis. Housing property rental revenue is recognized over the rental period once the tenant commences occupancy, rent is due and collection is assured. Annual property rental increases are based on rates established by provincial tenancy legislation. Contributions from CMHC and BCHMC are based on provisions set in agreements and outlined in note 2. Liability for A liability for remediation of a contaminated site is recognized when the Contaminated Sites site is no longer in productive use and the following criteria are satisfied; an environmental standard exists; contamination exceeds the standard; MVHC is either directly responsible or has accepted responsibility for remediation; it is expected that future economic benefits will be given up and a reasonable estimate of the liability can be made. Use of Estimates The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosure of contingent liabilities, in the financial statements. These estimates and assumptions are based on management’s best information and judgment and may differ from actual results. Adjustments, if any, will be reflected in the financial statements in the period that the change in estimate is made, as well as in the period of settlement if the amount is different. Significant areas requiring the use of management’s judgment relate to the determination of accrued liabilities and contaminated sites liabilities, the amortization rates of tangible capital assets and the assessment of all contingencies.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 6
Year ended December 31, 2019
2. Senior Government Assistance BCHMC is the administrator and provides the related government assistance for all of MVHC’s Federal programs (Section 95) and Provincial operating agreements (Homes BC and Seniors programs). In 2007, CMHC devolved its operations relating to the MVHC’s federal programs to BCHMC, which provides BCHMC with the authority to manage MVHC’s federal programs. Details of senior government assistance are as follows: NHA Section 95 The MVHC entered into agreements with CMHC pursuant to Section 95 Projects of the NHA whereby CMHC provides assistance to the MVHC based on a formula related to mortgage interest rates and adjusted upon subsequent mortgate renewals. Subject to BC Housing annual review, the assistance on a project may be reduced by repaying CMHC any surplus funds from rental operations after allowing for: i) the provision of a rental subsidy reserve to a cumulative maximum of $500 per rental property unit, and ii) the allocation of the annual operating surplus on a housing project, after providing the full rental subsidy reserve, to operating deficits of other projects.
CMHC mortgage Pursuant to Section 6 of the NHA, CMHC has undertaken to insure insurance mortgages payable by the MVHC.
NHA Section 82.1(a) Rental supplements are authorized under Section 82.1(a) and 82.1(b) of and 82.1(b) subsidy the NHA and are funded jointly by BCHMC on behalf of the both the Federal Government and the Province of British Columbia.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 7
Year ended December 31, 2019
3. Accounts Payable and Accrued Liabilities
2019 2018
Trade accounts $ 4,479,821 $ 2,627,350 Construction holdbacks 2,000,202 679,461 Accrued interest on mortgages and debenture debt 105,503 232,542 Other 11,722 12,221 $ 6,597,248 $ 3,551,574
4. Deferred Revenue and Refundable Deposits
2019 2018
Externally restricted funds for programs under BCHMC Agreements: Rental operations $ 1,678,802 $ 1,876,441 Replacement provisions 13,835,773 11,762,771 15,514,575 13,639,212 MVHC tenant security deposits 1,972,720 1,979,914 Rent and subsidies received in advance 258,938 116,945
Total $ 17,746,233 $ 15,736,071
2019 2018
Balance, beginning of year $ 15,736,071 $ 8,649,038
Net increase from unspent operating funds 41,118 41,526 Contributions received for capital replacement 11,877,758 11,069,809 Contributions used and recognized as revenue (10,043,513) (3,963,372) 1,875,363 7,147,963
Change in security deposits and prepaid rents 134,799 (60,930) Balance, end of year $ 17,746,233 $ 15,736,071
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 8
Year ended December 31, 2019
5. Forgivable Loan The mortgage related to Heather Place is forgivable by BCHMC over a 35‐year term provided that the property is continuously used for the provision of housing for eligible occupants and there is no default under the loan or operating agreement. Commencing in the 11th year of the mortgage 1/25th is forgiven each year. Should a breach in the agreement occur then the full outstanding balance of the loan would come due immediately. Payments of interest will not be required unless there is a default and consequently interest will be payable on the balance of the principal amount outstanding at prime plus 2% per annum, compounded semi‐annually and not in advance. MVHC has been approved to receive $6.7M by BCHMC. As at December 31, 2019, $6,685,520 (2018 ‐ $5,137,797) has been received.
6. Mortgages and Debentures Payable a) MVHC’s mortgages for Cedarwood, Crown Manor, Earle Adams, Euclid Square, Grandview Gardens, Kelly Court, Manor House, Regal Hotel and Semlin Terrace are financed through the MVRD at MVRD’s internal variable rate which was 2.46% in 2019 (2018 – 2.10%). b) Mortgages, upon renewal, are expected to be renegotiated on a long‐term basis. Annual principal repayments with and without renewal are as follows:
Assuming Assuming no renewal Long‐term renewal of mortgages of mortgages 2020 $ 12,146,720 $ 3,415,481 2021 5,681,913 3,186,004 2022 5,561,581 3,257,441 2023 1,910,601 3,175,718 2024 6,578,689 3,233,945 Thereafter 16,572,354 32,183,269 $ 48,451,858 $ 48,451,858 c) Mortgages payable with respect to projects constructed pursuant to Section 95 of the NHA are collateralized by specific charges on rental properties as well as a general assignment of rents and a chattel mortgage on the fixtures and equipment. Properties funded by BCHMC mortgages are collateralized by a general assignment of rents and the benefit of all covenants and agreements included in any lease. d) Mortgages reported on the Statement of Financial Position comprises the following and includes varying maturities up to 2038 with interest rates ranging from 1.03% to 4.87%.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 9
Year ended December 31, 2019
6. Mortgages and Debentures Payable (continued)
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 10
Year ended December 31, 2019
7. Tangible Capital Assets
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 11
Year ended December 31, 2019
8. Prepaid Land Leases
2019 2018 Balance, beginning of year $ 5,646,699 $ 5,841,498 Amortization (194,799) (194,799) Balance, end of year $ 5,451,900 $ 5,646,699
The lease terms for the properties are as follows:
Lease Term Asset Lease Expiry Dates (Years) Buildings Habitat Villa February 2029 50 Walnut Gardens May 2026 42 Other prepaid land leases May 2036 to June 2062 60
9. Accumulated Surplus
Accumulated surplus consists of authorized and issued 2,000 common shares with a par value of $1 per share and individual fund surplus and reserves as follows:
2019 2018
Reserves $ 14,126,059 $ 24,612,706 Capital fund 5,451,900 5,646,699 Investment in tangible capital assets 43,749,160 27,193,962 Share capital 2,000 2,000 $ 63,329,119 $ 57,455,367
Continuity of reserves is as follows:
2019 2018
Balance, beginning of year $ 24,612,706 $ 25,437,357 Interest 580,815 560,002 Contribution from (to) operations 929,430 (937,780) Contribution to capital (13,283,549) (2,377,242) Annual operating surplus 1,286,657 1,930,369 $ 14,126,059 $ 24,612,706
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 12
Year ended December 31, 2019
9. Accumulated Surplus (continued) Investment in tangible capital assets is calculated as follows:
2019 2018
Tangible capital assets $ 98,886,538 $ 85,462,196 Amounts financed by: Long‐term debt (48,451,858) (53,130,437) Forgiveable loan (6,685,520) (5,137,797) $ 43,749,160 $ 27,193,962
The change in investment in tangible capital assets is as follows:
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 13
Year ended December 31, 2019
10. Contingencies Lawsuits As at December 31, 2019 there were various lawsuits pending against the MVHC arising in the ordinary course of business. The MVHC has retained legal counsel to defend against these lawsuits for which the outcomes are not possible to reasonably determine at this time and therefore no accrual has been recognized. Management is of the opinion that the losses, if any, in connection with these lawsuits can be sufficiently funded by reserve funds or covered by insurance. Any ultimate losses are recorded as expenses at the time the amounts are reasonably determinable. Self Insurance A self insurance reserve has been established within the MVRD to cover Reserve losses resulting from uninsured liability exposures of the Metro Vancouver Districts and the MVHC. Each year a review is undertaken to determine if it would be beneficial to purchase liability insurance. The MVRD, its related Districts and the MVHC transfer amounts to the reserve depending on the reserve's adequacy to cover retained liability risk. An estimate is made for all costs of investigating and settlement of claims incurred annually and an adjustment is made to the fund to maintain an adequate balance to cover potential losses in excess of recorded liabilities. These adjustments are changed as additional information becomes known during the course of claims settlement. Any likely losses would be expensed by at the time the losses are known and the amounts are reasonably determinable. BC Homes As the Umbrella Agreement with BCHMC expired December 31, 2018, the Repayable properties included under this agreement have reverted back to their Assistance original operating agreements. The cumulative Non‐Rent Geared to Income (Non‐RGI) assistance is contingently repayable to BCHMC in the event that BCHMC’s unit rent contribution for any unit exceeds the economic or breakeven rent of the units occupied by Non‐RGI tenants in any year. MVHC is required to commence repayment of the cumulative Non‐RGI assistance on the first day of the fiscal year following the fiscal year in which the preceding event occurs. The balance then bears interest at bank prime and the required monthly payments are set annually based upon the amount by which Non‐RGI BCHMC’s unit rent contributions exceed economic rent for these units in the prior year. Currently the estimated total Repayable Assistance at December 31, 2019 is $nil (2018 – $nil). However, the balance will be reconciled and finalized once BCHMC completes the financial review for the fiscal year ended December 31, 2019.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 14
Year ended December 31, 2019
10. Contingencies (continued) Section 95 Rental As at December 31, 2019, there are 3 remaining properties within MVHC’s Subsidy Provision Section 95 portfolio, which total 170 units. These properties have a cumulative maximum allowable rental subsidy provision of $500 per unit plus interest, which is recorded as deferred revenue. Amounts in excess of $500 per unit plus interest is repayable to BCHMC, who manages and administers the portfolio on behalf of CMHC. The maximum allowable provision is $85,000. As at December 31, 2019, the current year excess is $610,685. BCHMC will perform an annual review to determine whether funds will be repaid or added to the subsidy provision (deferred revenue). If approved, transfers will occur in the year of assessment. The remaining properties will mature out of the section 95 agreement as of the following dates:
Property Maturity Date
Walnut Gardens January 1, 2020 McBride Place February 1, 2020 Pinewood Place October 1, 2020
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Notes to Financial Statements, page 15
Year ended December 31, 2019
11. Budget Information The annual budget presented in these financial statements is based upon the 2019 operating and capital budgets approved by the Corporation’s Board in October 2018, with additional approval in May 2019 for adjustments to the budget as a result of the 2018 fiscal year end results. The budget is based on operational and capital expenditure requirements and their associated funding. Amortization is a non‐cash item that is not funded for budget purposes. Also, contributions to or from reserves and debt principal repayments are removed from the approved budget for financial statement presentation. The schedule below reconciles the approved budget to the budget figures reported in these financial statements. Capital expenditures of $21,317,000 were included in the Capital Budget approved by the Board.
12. Subsequent Event
Subsequent to year end, the impact of COVID‐19 in Canada and on the global economy has been unprecedented. As the impacts of COVID‐19 continue, there could be further impact on the Corporation, its tenants, employees, suppliers and other third party business associates that could impact the timing and amounts realized on the Corporation’s assets and future ability to deliver services and projects. At this time, the full potential impact of COVID‐19 on the Corporation is not known. Although the disruption from the virus is expected to be temporary, given the dynamic nature of these circumstances, the duration of disruption and the related financial impact cannot be reasonably estimated at this time. The Corporation’s ability to continue delivering non‐essential services and employ related staff, will depend on the legislative mandates from the various levels of government. The Corporation will continue to focus on collecting receivables, managing expenditures, and leveraging existing reserves and available credit facilities to ensure it is able to continue providing essential services to its citizens.
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Schedule 1 Schedule of Operating Fund (unaudited)
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual
Revenue Property rental $ 39,309,579 $ 40,869,815 $ 39,904,174 Contributions Canada Mortgage and Housing Corporation 5,520 355,854 826,776 British Columbia Housing Management Commission 1,083,034 1,710,361 1,174,378 Restricted contributions (48,907) (1,543,581) (7,111,492) Interest 48,907 207,558 162,396 Other revenues 870,086 784,099 769,146 41,268,219 42,384,106 35,725,378
Expenses Asset repairs and maintenance 18,647,769 17,323,375 11,611,930 Utilities, permits and taxes 6,123,191 6,401,118 5,691,582 Salaries and benefits 5,892,652 5,855,266 5,559,199 Interest on long‐term debt 1,522,971 1,506,564 1,661,148 Management fees and net corporate costs 2,119,752 2,076,090 2,059,225 Consulting, contracted and professional services 758,568 634,742 526,729 Materials and supplies 142,534 246,906 210,779 Other 918,841 743,902 675,107 36,126,278 34,787,963 27,995,699 Annual surplus, operating fund 5,141,941 7,596,143 7,729,679
Application of surplus and transfers Mortgages and debt retirement (4,678,791) (4,678,579) (6,517,963) Transfers from (to): Capital ‐ (701,477) (219,127) Reserve funds for: Reserves ‐ operating results ‐ (1,286,657) (1,930,369) Reserves (463,150) (929,430) 937,780 Change in operating fund ‐ ‐ ‐
Operating fund, beginning of year ‐ ‐ ‐
Operating fund, end of year $‐ $ ‐ $ ‐
Performance and Audit Committee METRO VANCOUVER HOUSING CORPORATION Schedule 2 Schedule of Capital Funds (unaudited)
Year ended December 31, 2019
2019 2019 2018 Budget Actual Actual
Revenue $‐ $ ‐ $ ‐
Expenses Amortization of tangible capital assets 2,074,950 2,108,407 2,889,801 Amortization of prepaid land lease ‐ 194,799 194,799
Annual deficit, capital fund (2,074,950) (2,303,206) (3,084,600)
Non‐financial asset transactions Acquisition of tangible capital assets 21,317,000 15,532,749 7,734,166 Amortization of tangible capital assets (2,074,950) (2,108,407) (2,889,801) 19,242,050 13,424,342 4,844,365
Financing Forgivable loan issued ‐ 1,547,723 5,137,797 Transfers from (to): Operating fund ‐ 701,477 219,127 Reserve funds 21,317,000 13,283,549 2,377,242 21,317,000 15,532,749 7,734,166 Non‐financial asset transactions and financing (2,074,950) (2,108,407) (2,889,801) Change in capital funds ‐ (194,799) (194,799)
Capital funds balance, beginning of year 5,646,699 5,646,699 5,841,498
Capital funds balance, end of year $ 5,646,699 $ 5,451,900 $ 5,646,699
Performance and Audit Committee
5.3
To: Performance and Audit Committee
From: Dean Rear, General Manager, Financial Services/Chief Financial Officer
Date: March 27, 2020 Meeting Date: May 6, 2020
Subject: 2019 Financial Results Year-End
RECOMMENDATION That the MVRD Board receive for information the report dated March 27, 2020, titled “2019 Financial Results Year-End”.
EXECUTIVE SUMMARY The final overall operational results for 2019 for Metro Vancouver’s functions is a net surplus of close to $21.3 million on an approved budget of $836.4 million or slightly more than 2.5% of the budget. The results were positive for most functions with surpluses realized used to avoid debt or fund other projects. Solid Waste incurred unexpected expenditures for Vancouver Landfill non closure project costs not included in the calculated operational rate for the Vancouver Landfill which required a draw from its Operating Reserves.
In addition, capital program expenditures for Metro Vancouver’s functions were under spent for the year by $201.3 million overall with the majority of the surplus generated in the Liquid Waste function due to the delay/deferral of expenditures for several major capital projects to future years.
PURPOSE To present the Board with the final report on financial performance for the year ending December 31, 2019 as compared to the 2019 annual budget.
BACKGROUND The Performance and Audit Committee Terms of Reference requires that the Committee be provided, three times per year, an update on the financial performance of the Metro Vancouver Districts and Metro Vancouver Housing Corporation (MVHC) with the report on the year-end results also sent to the Board.
This is the third and final report for 2019, with the results for the year in terms of comparison to the annual budget.
HIGHLIGHTS Operating Results The final overall operational results for 2019 for Metro Vancouver’s functions is a net surplus of close to $21.3 million on an approved budget of $836.4 million or slightly more than 2.5% of the budget. All of the Metro Vancouver’s Districts and MVHC were in surplus positions for the 2019 fiscal year except for Solid Waste Services which required the application of operating reserves of $14.5 million primarily due to a share of landfill expenditures for incurred non closure landfill
Performance and Audit Committee 2019 Financial Results Year-End Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 2 of 5
capital project costs that were previously unbilled. The overall surplus is mainly due to the deferral of some operating and capital projects, staff vacancies, lower miscellaneous operating costs and lower debt service costs in the utilities.
Budgets are set and approved based on the best information available at the time of preparation and presentation. Throughout the course of the year, changing operational priorities or unforeseen operational constraints along with pursuing alternate paths and looking for operational efficiencies can lead to actual results differing from original expectations. In accordance with the Operational, Discretionary and Statutory Reserves Policy, financial surpluses generated from operations are used for the benefit of either the District or the function from which the surplus was generated, usually by first avoiding or paying down debt, followed by allocation to reserves to be used for future one- time expenditures or to reduce future tax requisitions, levies or fees to the member municipalities. An overview of the 2019 financial performance is provided below. Details, explanations and a trend analysis of some key financial indicators are provided in the attachment.
Revenues Operating Capital Applied Total Expenditures Funding Operating Reserves Surplus/(Deficit) millions Water District $ (2.7) $ 5.9 $ 2.7 $ - $ 5.9 Sewerage & Drainage Liquid Waste Services (8.9) 12.3 5.5 - 8.9 Solid Waste Services 7.1 (23.7) 2.1 14.5 - MV Housing Corporation 2.1 0.6 - - 2.7 Regional District 0.1 3.7 - - 3.8 $ (2.3) $ (1.2) $ 10.3 $ 14.5 $ 21.3
Regional District: The operating surplus in the Regional District can be mainly attributed to underspends resulting from staff vacancies/labour under spends in Regional Parks, Regional Planning, Regional Prosperity, Air Quality, Labour Relations and Affordable Housing, lower Board and Committee costs in General Government, the deferral of some consulting project initiatives in Regional Parks, Regional Planning, Regional Prosperity, Air Quality, and some underspends for equipment purchases in Air Quality and Global Positioning System. Also there was slightly higher than planned net revenues generated in 2019 from grants and some other miscellaneous revenues.
Water District: The operating surplus is largely due to slightly lower water sales than were budgeted and less reserve applications offset by slightly higher lease/other miscellaneous revenues, and lower operating expenditures resulting from staff vacancies, and some underspends in the water treatment and water supply program costs due to less consulting, lower water treatment chemical demands, savings in electricity and less easement acquisitions. As well, debt servicing costs were lower due primarily to some additional contribution to capital from operational surplus from the prior year as well as favourable terms received on the re-financing of some existing debt.
Performance and Audit Committee 2019 Financial Results Year-End Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 3 of 5
Liquid Waste: The operating surplus is primarily due to deferral of some minor capital, residuals and research and innovation program work combined with lower debt service costs due to the application of operational surplus from the prior year and favourable terms on the re-financing of some existing debt. In addition, there were additional underspends in several operations programs. The underspends were offset by less reserve funding usage due to project underspends in residuals and research and innovation along with less DCC revenues offset by slightly higher other revenues.
Solid Waste: For 2019, Solid Waste required a transfer from its Operating Reserve of $14.5 million. Net revenues were higher by close to $7.1 million primarily due to higher than expected waste flows. Expenses were higher than budget by $21.6 million primarily due to the previously unbilled non closure landfill costs.
MV Housing Corporation: The surplus position for the year is primarily due to more housing rents and subsidy revenues than planned along with slightly lower than expected operating expenditures.
Centralized support programs finished in a surplus position for 2019 of approximately $0.57 million primarily due to staff vacancies in a number of support functions as recruitment efforts continue, underspends for security and legal arbitration costs offset by slightly higher debt servicing costs.
Budget Surplus Compared to Financial Statement Surplus Metro Vancouver is required to prepare balanced budgets by its enabling legislation, however the budget information reported on the financial statements must be per public sector accounting standards. This creates a difference between the reported annual surplus on the financial statements and the surplus to budget. The table below reconciles that difference:
Annual surplus per consolidated Statement of Operations (Exhibit B) $ 489,623,426 Items not included in the operating budget: Amortization of tangible capital assets 82,515,412 Loss on disposal of assets 2,993,780 Sinking fund and debt retirement income (21,078,765) Reserve interest (7,925,517) Deferred revenue contributions 1,875,362 Capital grants and other income (252,668,269) Corporate programs revenue (excluding reserve funding) (7,111,839)
Items not included in budget but not in financial statements: Sinking fund and debt retirement payments (91,292,669) Transfers to capital fund (182,724,522) Transfers from reserve funds 7,049,613 Annual surplus per Financial Performance Report $ 21,256,012
Performance and Audit Committee 2019 Financial Results Year-End Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 4 of 5
Capital Results Overall capital expenditures for Metro Vancouver for 2019 were under budget by $201.3 million. The majority of the under spend variance is related to the 3 utilities. The underspend in capital is a key contributor to the lower debt servicing costs noted above for all 3 of the utilities. The 2019 budget anticipated $275.9 million in borrowing for Water Services, Liquid Wates Services and Solid Waste Services for the year, however, only $108.0 million in new borrowing was undertaken related to 2019 capital, contributing to the reduced debt servicing costs noted above.
The summary of 2019 Capital Expenditures is as follows:
2019 2019 Variance Budget* Actual Surplus/(Deficit) millions Water District $ 231.4 $ 243.5 $ (12.1) Sewerage & Drainage Liquid Waste Services 564.9 417.6 147.3 Solid Waste Services 89.2 31.6 57.6 MV Housing Corporation 32.1 24.2 7.9 Regional Parks 19.4 18.8 0.6 $ 937.0 $ 735.7 $ 201.3
*Includes annual budget amounts plus additions as approved by the Board
Further discussion on capital results is included in the report titled “2019 Capital Program Expenditure Update” dated March 28, 2020.
FINANCIAL INDICATORS The table below summarizes the list of financial indicators used to show Metro Vancouver’s ability to provide services to the region on a sustainable basis. Detailed calculations and explanations are included in Attachment 1. 2018 2019 Actual Actual Municipal Property Tax and Levies/Total Revenue 37.7% 3 8.1% Current Ratio (current asset to current liabilities) 5.3 to 1 3.3 to 1 Debt Service Costs/Total Revenue 17.0% 16.4% Interest Costs/Total Revenue 6.2% 5.6% Operating Reserves/Total Revenue 10.5% 7.9% Total Municipal Taxes, Water, Sewer and Solid Waste Charges Per Capita $252 $263
ALTERNATIVES This report is provided for information. No alternatives are presented.
Performance and Audit Committee 2019 Financial Results Year-End Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 5 of 5
FINANCIAL IMPLICATIONS This report provides information on the results of 2019 operations which generated a surplus of $21.3 million. This surplus is available in future years to either avoid debt through additional contributions to capital or to pay for future projects or to reduce future tax requisitions, levies or fees to the member municipalities.
SUMMARY / CONCLUSION Overall, the 2019 financial results for the Metro Vancouver entities and functions were generally favourable to budget with a surplus of $21.3 million.
Attachments: Attachment 1 – 2019 Financial Performance
37088871
Performance and Audit Committee
ATTACHMENT 1
Metro Vancouver Districts
2019 Financial Performance
May 2020
Performance and Audit Committee
Table of Contents
Metro Vancouver Districts – Surplus to Budget ...... 1
District Summaries • Water District ...... 2 • Sewerage & Drainage District Liquid Waste ...... 3 Solid Waste ...... 3 • Housing Corporation ...... 4 • Regional District ...... 5-6 Centralized Support Programs ...... 7
Financial Indicators ...... 8-10
Performance and Audit Committee Page 1
METRO VANCOUVER DISTRICTS SURPLUS TO BUDGET 2019 FINANCIAL PLAN
2019 BUDGET 2019 2019 ORIGINAL ADJUSTMENTS AMENDED ACTUAL VARIANCE BUDGET MAY 2019 BUDGET RESULTS
REVENUES
Water Sales $ 286,908,565 $ - $ 286,908,565 $ 285,316,390 $ (1,592,175) Liquid Waste Services Levy 255,810,755 - 255,810,755 255,810,755 - Solid Waste Tipping Fees 98,362,329 - 98,362,329 105,692,375 7,330,046 Metro Vancouver Regional District Requisitions 61,188,452 - 61,188,452 61,188,452 - Compensation Services Revenue 478,280 - 478,280 478,280 - Collective Bargaining Services Revenue 867,558 - 867,558 867,558 - Housing Rents 39,309,579 - 39,309,579 40,930,512 1,620,933 Liquid Waste Industrial Charges 11,022,967 - 11,022,967 11,219,515 196,548 Energy Sales 5,927,304 - 5,927,304 5,793,404 (133,900) Transfer from DCC Reserves 31,665,173 - 31,665,173 30,388,981 (1,276,192) User Fees 5,257,010 - 5,257,010 5,503,656 246,646 Housing Mortgage Subsidies 1,088,554 - 1,088,554 2,066,215 977,661 Non-Road Diesel Permit Fees 2,450,000 - 2,450,000 3,189,790 739,790 Regional Global Positioning System User Fees 314,180 - 314,180 314,180 - Electoral Area Requisition 366,510 - 366,510 366,510 - Love Food Hate Waste 556,000 - 556,000 252,275 (303,725) Zero Waste Conference 180,000 - 180,000 208,884 28,884 Other External Revenues 9,311,422 - 9,311,422 11,284,292 1,972,870 Transfer from Sustainability Innovation Fund Reserve 1,045,000 2,204,082 3,249,082 748,831 (2,500,251) Transfer from Reserves 19,292,080 2,776,000 22,068,080 26,890,302 4,822,222
TOTAL REVENUES $ 831,401,718 $ 4,980,082 $ 836,381,800 $ 848,511,156 $ 12,129,356
EXPENDITURES
Operating Programs: Greater Vancouver Water District $ 289,119,931 $ 1,554,174 $ 290,674,105 $ 282,018,625 $ (8,655,479)
Greater Vancouver Sewerage & Drainage District: Liquid Waste 308,580,625 2,288,903 310,869,528 293,054,310 (17,815,218) Solid Waste 107,157,767 - 107,157,767 128,787,356 21,629,589
Metro Vancouver Housing Corporation 51,269,461 - 51,269,461 50,699,381 (570,080)
Metro Vancouver Regional District Affordable Housing 1,839,479 - 1,839,479 1,582,088 (257,391) Air Quality 10,748,317 399,550 11,147,867 10,445,081 (702,786) E911 Emergency Telephone Service 4,411,585 - 4,411,585 4,361,827 (49,758) Electoral Area Service 621,984 608,500 1,230,484 1,166,397 (64,087) General Government 6,994,003 - 6,994,003 6,376,454 (617,549) Labour Relations 2,849,713 - 2,849,713 2,662,124 (187,589) Regional Economic Prosperity 484,500 - 484,500 67,293 (417,207) Regional Emergency Management 228,104 - 228,104 147,679 (80,425) Regional Global Positioning System 549,880 - 549,880 415,057 (134,823) Regional Parks 42,679,709 - 42,679,709 41,932,942 (746,767) Regional Planning 3,527,732 128,955 3,656,687 3,208,083 (448,604) Sasamat Fire Protection Service 338,928 - 338,928 330,448 (8,480) 75,273,934 1,137,005 76,410,939 72,695,472 (3,715,467)
TOTAL EXPENDITURES $ 831,401,718 $ 4,980,082 $ 836,381,800 $ 827,255,144 $ (9,126,656)
2019 SURPLUS TO BUDGET $ 21,256,012
Performance and Audit Committee Page 2
Metro Vancouver Districts 2019 Financial Performance District Summaries
Greater Vancouver Water District
The Water District is in a surplus position of approximately $5.9 million for the 2019 fiscal year.
Total Water District revenues, overall, are below budget by approximately $2.7 million for 2019 primarily due to water sales below budget by $1.6 million as water consumption levels for 2019 were slightly less than budget by 0.93%. In addition, there was less reserve utilization than budget of close to $2 million due to several delayed projects, right of way acquisitions and equipment (laboratory) purchases funded by reserves, offset by unbudgeted lease/miscellaneous revenues of close to $0.9 million.
Total Water District expenditures for 2019 are $8.6 million below budget of which approximately $5.9 million is primarily due to savings on, and the delay/deferral of, some projects. As well there were some labour underspends due to operating staff vacancies (with ongoing recruiting), lower water treatment costs - residuals and water supply programs for consulting, electricity, chemicals and some delayed easement acquisition purchases.
Debt servicing costs were lower than anticipated by approximately $2.7 million for the year primarily due to some additional contribution to capital from the application of the 2018 operational surplus thereby avoiding some new debt financing. Also, in addition to debt avoidance gains, we have continued to experience favourable terms on the re-financing of some existing Water debt.
The 2019 generated operations surplus will be applied to capital to avoid future debt requirements.
Performance and Audit Committee Page 3
Greater Vancouver Sewerage and Drainage District
Liquid Waste
Liquid Waste Services realized a surplus of $8.9 million primarily due to operational expenditure surpluses of $12.3 million, a debt surplus of $5.5 million offset by lower than budget revenues of $8.9 million. The breakdown of the surpluses to each of the Sewerage and Drainage Areas is as follows: Vancouver Sewer Area $1.15 million, North Shore Sewer Area $0.46 million, Lulu Island Sewer Area $2.0 million, Fraser Sewer Area $5.36 million and Drainage $(0.07) million. The deficit for the Drainage areas is due to the Still Creek Drainage area which realized a ($0.25) million deficit.
Function revenues were under budget by about to $8.9 million primarily due to applications from reserves not fully utilized and were related to delays in several Sustainability Innovation Fund (SIF) projects ($1.4 million) and delays in residuals program work ($6.7 million). Transfer from DCC reserve revenues were less than budget by $1.3 million offset by other revenues higher than budget of close to $0.5 million.
Debt servicing costs were lower than anticipated by approximately $5.5 million for the year due to the delay of some major capital projects, along with some additional contribution to capital from the application of the 2018 operational surplus thereby avoiding some new debt financing. Also, we have continued to experience favourable terms on the re-financing of some existing Sewerage debt. The function’s operational costs were under budget by close to $12.3 million. $3.6 million of the variance is attributable to under spends on Minor Capital caused by the cancellation and delay of some projects. Also, delays in the Residuals program work make up about $7.7 million of the variance and is due to lower grit production than expected from the Iona solids handling facility and delays in acquiring Iona lagoon dewatering construction permits. Research and Innovation program was also $1.4 million under budget primarily due to the delay in the commencement of SIF projects. Offsetting the above were some net operational deficits of $0.4 million in several program areas.
The 2019 generated operations surplus will be applied to capital to avoid future debt requirements.
Solid Waste
Higher than expected waste flows offset by additional expenditures has led to the final net results being substantially lower than anticipated when compared to the final budget. For 2019, Solid Waste required a transfer from its Operating Reserve of $14.5 million. Operating expenses were higher than budget by $21.6 million primarily due to the previously unbilled non closure landfill capital costs from the City of Vancouver.
Higher than expected waste flows resulted in increased fee revenues of close to $7.3 million. In 2019, actuals waste flow tonnes of 921,000 were 71,000 tonnes higher than budget (850,000) and essentially matched the waste flow levels experienced in 2018. Vancouver Landfill projects costs incurred in 2019 that were excluded from the Vancouver Landfill operating rate calculations totaled approximately $20.9 million from the City of Vancouver. Debt service costs were under budget by $2.1 million primarily due to delays in capital expenditures plus there were some reduced bottom ash expenditures for the Waste to Energy Facility.
Performance and Audit Committee Page 4
Metro Vancouver Housing Corporation (MVHC)
MVHC had a net surplus from operations of $2.7 million for the year ended December 31, 2019. Total contribution to reserves for the Metro Vancouver Housing Corporation in 2019 was $11.4 million, which is $2.7 million, or net surplus generated from operations, over the budgeted $8.7 million. Rent revenues for the MVHC were higher than budget by $1.6 million due to vacancy loss being 52% less than expected as vacancy rates were consistently below 1% in 2019. Subsidies received from BC Housing totaled $2.1 million which is $1.1 million higher than expected. The capital replacement program was underspent by 6%, resulting in $615,000 less reserve funding.
Total expenditures overall through to the end of December are approximately $50.7 million and were less than budget by approximately $0.6 million. The property operations program area was overspent by close to $641,000 in 2019 which includes utilities permits and taxes which were over budget by $300,000 due primarily to an increase in property taxes, harsher winter conditions resulted in the need for increased exterior maintenance work related to catch basin cleaning, snow removal, salting and walkway repair for an over spend of around $184,000 in asset purchase and maintenance and $114,000 in materials and supplies. These operational program over spends were offset close to $600,000 in miscellaneous under spends in MVHC’s administrative, communications, tenant and other program services and by the $615,000 under spend for capital replacement work budgeted at $10 million for 2019. Capital replacement expenditures totaled close to $9.4 million with the $615,000 under expenditure due primarily to permit and design delays in major building envelope projects leading to lower than budget expenditures overall offset by roofing work and boiler replacement expenditure increases resulting from unanticipated repair/replacement work.
Performance and Audit Committee Page 5
Metro Vancouver Regional District The Regional District is in a surplus position of approximately $3.8 million for 2019. This surplus is primarily due to salary underspends from staff vacancies as recruitment efforts continue, lower than expected legal costs in Labour Relations, lower Board and Committee meeting costs, lower Leadership and Engagement travel and training costs, lower consulting expenditures and lower equipment purchases than planned in several areas plus slightly more other revenues than budget.
Affordable Housing The affordable housing program realized a net surplus of close to $257,000 for the year. The net surplus was the result of lower than expected expenditures, that included two vacant program manager positions for the majority of 2019, with one position filled in November, leading to an underspend in salaries of approximately $286,000. Consulting and professional services were higher by close to $54,000 and the budgeted, planned expenditures of $25,000 for the function’s communications program were deferred to 2020.
Air Quality The function ended the year with a surplus of close to $819,000 due primarily to a change in the approach for the recognition of Non Road Diesel Engines rebate provisions, along with some labour underspend due to staff vacancies, as well as some consulting, contract, and asset purchase underspends offsetting additional incurred legal expenses related to ongoing enforcement matters.
E911 Emergency Telephone E911 was essentially on budget for the year with a small surplus realized of approximately $50,000.
Electoral Area Services Electoral Area Services is in a surplus position of close to $163,000 primarily due to a onetime additional Community Works grant and salary under spends due to demand and a leave of absence.
General Government General Government realized a surplus of close to $934,000 due to under expenditures of close to $260,000 in Board and Legislative Services as a result of cancellations or lower attendance at meetings, $125,000 underspends for Leadership and Engagement due to lower attendance at meetings and fewer international events attended, underspends of $32,000 in Circular Economy due to a delay in finalizing the membership agreement with the Ellen MacArthur Foundation, $49,000 underspends for Zero Waste Communications primarily due to reduced Newsletter quantity in 2019 and a reduction in printing costs received as a result of poor printing quality, $203,000 underspends for Love Food Hate Waste program due to lower recruitment of campaign partners than budgeted and, due to this fact, also an under receipt in revenues, $87,000 over expenditures for National Zero Waste Council offset by an increase in revenues, offset by less net revenues for LFHW/NZWC/other programs of about $208,000 and $524,000 more grants-in-lieu revenues received than were budgeted due to timing of the receipts, and other miscellaneous program net underspends of $36,000 comprising the balance of surplus.
Performance and Audit Committee Page 6
Labour Relations (Regional Employer Services) The function is in a surplus position of approximately $276,000 for 2019 primarily due to close to net $157,000 in expenditures overall due to labour savings as a result of staff vacancies (delays in recruiting), under expenditures in legal due to timing of bargaining as determined by the member jurisdictions, underspends on travel and training, offset by some incurred over expenditures in consulting to meet deliverables. In addition, other revenues were higher than budget by $119,000.
Regional Economic Prosperity Regional Prosperity is in a surplus position of close to $342,000 due to timing of approval of the new service with resultant underspends for labour due to staff vacancies, consulting and contracts.
Regional Emergency Management (REM) Regional Emergency Management’s surplus for the year was close to $11,000 due to completing projects in-house.
Regional Global Positioning System (GPS) Regional Global Positioning has a surplus of close to $124,000 for 2019. This was mainly due to lower than expected equipment purchase and consulting costs.
Regional Parks In 2019, Regional Parks had an operating surplus for 2019 of close to $702,000 primarily due to $175,000 lower site supervision costs than budget from lower filming activity in 2019, salaries were under spent by close to $290,000 due to positions budgeted at maximum steps, consulting was under spent by around by $135,000 due to delays in hiring contractors and unpredictability in legal costs and revenues from group programs and facility rentals exceeded budget by close to $100,000.
Regional Planning Regional Planning ended the year with close to a $152,000 surplus primarily due to labour underspends from vacancies and lower than planned consulting expenditures.
Sasamat Fire Protection Service The Sasamat Fire Protection Service was slightly under budget by close to $8,000 for the 2019 year.
Performance and Audit Committee Page 7
Centralized Support Programs
Centralized Support Programs are in a surplus position of close to $570,000 on an overall approved budget of around $72.8 million. Specific comments for the support program areas are noted below:
External Relations External Relations is in a surplus position of close to $365,000 for the year, due to savings on salaries as a result of staff vacancies as the department adjusts to a recent restructuring, and some under spends for travel, tuition and consulting along with some other miscellaneous expenditures.
Human Resources Human Resources is in a surplus position of close to $180,000 at year end due to savings in labour as a result of staff vacancies (recruitment challenges), under expenditures in consulting costs due to fewer arbitrations as well as underspends for travel, training and some miscellaneous expenditures.
Financial Services Financial Services is in a surplus position of close to $590,000 at year end due to savings in labour due to staff vacancies as the departments adjusts to restructuring and resource requirements from the new financial management system and as a result of the CFO vacancy for a portion of the year.
Legal Services and Indigenous Relations Legal Services and Indigenous Relations ended the year in a surplus position of close to $728,000 due to staff vacancies in the Indigenous Relations and In-House Legal programs.
Corporate Services Corporate Services, which comprises Head Office Operations, Corporate Security and Emergency Management, and Information technology had a deficit of approximately $1.3 million for the year.
Corporate Projects and Facilities had close to a net deficit of $815,000, mainly due to the disposal costs for selling the Kingsway and Kathleen former head office properties. Interest expense for MTIII acquisition were approximately $1.66 million higher due to the final debt issuance in April.
All $1.2 million expenses incurred in for building capital were fully funded from reserve. Capital expenses were under budget by $1.0 million in contract services for tenant improvements on 8th and 9th floors of Metro Tower III as work started later than anticipated due to it taking longer to finalize the leases.
Corporate Security ended the year with close to $515,000 surplus due to lower contract rates plus security no longer required for Kingsway. Corporate Safety had close to a $144,000 surplus due to underspends in consulting and lease vehicles.
Information Technology is in a surplus position of approximately $538,000 due to underspends on salaries as a result of staff vacancies (recruitment challenges), which is offset partially by over expenditures on consulting and under expenditures on asset purchases due to changes in project scope.
Performance and Audit Committee Page 8 Metro Vancouver Districts Financial Indicators
These ratios are intended to help indicate the Metro Vancouver Districts’ financial ability to continue to provide services to the region on a sustainable basis. This involves evaluating a number of factors, including the ongoing ability to ensure revenues meet expenditures, ability to meet debt obligations, and the flexibility to address unexpected contingencies. Forecast ratios can help to identify potential financial problems in advance.
1) MVRD Requisition and Levies / Total Revenue
This ratio is a measure of the diversification of revenues. A high ratio indicates a reliance on property tax related levies / fees. A low ratio illustrates a greater range of revenues which is seen as beneficial. However, other revenue streams may not be sustainable or fluctuate more than tax requisitions.
2016 Actual 2017 Actual 2018 Actual 2019 Budget 2019 Actual
Total Property tax/levies $250,542,028 36.6% $266,131,902 37.0% $291,309,226 37.7% $317,365,717 37.9% $317,365,717 38.1% Total Revenue** $684,548,274 $719,022,155 $771,746,665 $836,381,800 $834,011,157
The Metro Vancouver has a reasonably well diversified revenue base. Some revenue streams such as Water Sales and Solid Waste User Fees are subject to fluctuations during the year.
2) Current Ratio
This is one measure of liquidity – the ability of the local government to meet current obligations through existing current assets. A high ratio indicates a greater ability to respond to and meet budgeted and unexpected expenditures.
2016 Actual 2017 Actual 2018 Actual 2019 Actual
Current Assets $666,745,861 4.2 to 1 $960,619,976 5.3 to 1 $1,237870481 5.3 to 1 $1,024,126,331 3.3 to 1 Current Liabilities $160,292,061 $182,481,663 $234,489,303 $ 308,636,243
**2019 Budget includes budgeted reserve, surplus carry-forward items or other additional reserve applications as approved by the Board.
Performance and Audit Committee Page 9
3) i) Debt Service Costs/ Total Revenue
This is the percentage of revenue committed to payment of interest and principal on temporary and long-term debt for the regional, sewer, solid waste, water and housing operations. A high percentage indicates greater use of revenues for the repayment of debt, and less ability to adjust to unplanned events and changing circumstances.
2016 Actual 2017 Actual 2018 Actual 2019 Budget 2019 Actual
Debt Service Costs $122,585,472 17.9% $129,794,146 18.1% $131,430,401 17.0% $148,600,329 17.8% $137,166,682 16.4% Total Revenue** $684,548,274 $719,022,155 $771,746,665 $836,381,800 $834,011,157
3) ii) Interest Costs/ Total Revenue
This is the percentage of revenue committed to payment of interest on temporary and long-term debt for the regional, sewer, solid waste and water operations. A high percentage indicates greater use of revenues for servicing interest on outstanding debt, and less ability to adjust to unplanned events and changing circumstances.
2016 Actual 2017 Actual 2018 Actual 2019 Budget 2019 Actual
Interest Costs $45,154,165 6.6% $49,782,922 6.9% $47,625,913 6.2% $58,167,193 7.0% $46,756,655 5.6% Total Revenue** $684,548,274 $719,022,155 $771,746,665 $836,381,800 $834,011,157
Both the overall debt service costs and interest costs, as a percentage of revenue, are down slightly when compared to current budget and prior year indicating less of revenues are required to service outstanding debt (principal and interest) and more is available to fund priority projects.
** 2019 Budget includes budgeted reserve, surplus carry-forward items or other additional reserve applications as approved by the Board.
Performance and Audit Committee Page 10 4) Operating Reserves/ Total Revenues
Reserve levels are an indicator of financial strength since they provide the ability to meet unforeseen expenditures or revenue losses.
2016 Actual 2017 Actual 2018 Actual 2019 Budget 2019 Actual
Operating Reserves $74,874,847 10.9% $92,617,848 12.9% $81,173,432 10.5% $53,769,992 6.4% $66,205,956 7.9% Total Revenue** $684,548,274 $719,022,155 $771,746,665 $836,381,800 $834,011,157
As per the Operating, Discretionary and Statutory Reserve Policy, operating reserves are set to be a factor of the operating budgets for each of the functions to adequately meet potential unexpected contingencies.
5) Total MVRD Requisition, Water, Sewer and Solid Waste Charges / Per Capita
This indicator is a representation of the per capita cost impact of the regions tax payer supported services. These costs are passed on to the tax payer through our member municipalities. The 2019 population is assumed to increase at a rate of 1.5% over 2018.
2016 Actual Per 2017 Actual Per 2018 Actual Per 2019 Budget Per 2019 Actual Per Capita Capita Capita Capita Capita Total Tax Revenue *** $595,144,960 $230 $629,251,790 $241 $667,977,139 $252 $702,636,611 $261 $708,374,482 $263 Total Population **** 2,582,207 2,612,881 2,652,302 2,694,039 2,691,343
The resultant increase in the actuals over the budget for 2019 is primarily a result of an increase in actual revenues for Solid Waste User Fees.
** 2019 Budget includes budgeted reserve, surplus carry-forward items or other additional reserve applications as approved by the Board. *** Total Tax Revenue is defined as MVRD Tax Requisitions, Water Sales, Sewerage & Drainage Levies and Solid Waste User Fees. **** Based on Demographic Analysis Section, BC Stats, Ministry of Jobs, Economic Development and Competitiveness, Government of British Columbia, January 2020.
Performance and Audit Committee
5.4 5.3
To: Performance and Audit Committee
From: Dean Rear, General Manager, Financial Services/Chief Financial Officer
Date: April 27, 2020 Meeting date: May 6, 2020
Subject: Semi-Annual Report on GVS&DD Development Cost Charges
RECOMMENDATION That the Performance and Audit Committee receive for information the report dated April 27, 2020, titled “Semi-Annual Report on GVS&DD Development Cost Charges”.
EXECUTIVE SUMMARY Total GVS&DD Development Cost Charges (DCC’s) collected in 2019 was $60.2 million, up from $32.1 million in the prior year. This is due primarily to the rate increase which came fully into effect in May of 2019.
Affordable housing development DCC waivers were approved in 2019 for a total of 946 units representing $1.5 million in forgone revenue.
Total DCC’s held in reserve at December 31, 2019 was $227.5 million.
PURPOSE To report on the 2019 GVS&DD Development Cost Charge (DCC) revenues and any implications on their adequacy, as required by the Performance and Audit Committee Terms of Reference.
BACKGROUND Regional GVS&DD Development Cost Charges (DCC’s) are collected on behalf of Metro Vancouver, as set out in the Board approved DCC Bylaw, by member municipalities and remitted twice a year. DCC’s are used to fund growth related capital expenditures. The Performance and Audit Committee Terms of Reference requires that the DCC collections be reported to the Committee on a semi- annual basis. This is the second and final report for 2019.
DCC COLLECTIONS The collections received for 2019 were $32.1 million (214.2 %) higher than that for 2018. Though there were only modest increases in two of the four sewer areas, the collections still reflect a fairly consistent and, in two areas, an elevated level of development activity combined with the impact of higher DCC rates that were implemented recently. DCC collections received by area are as follows:
DCC’s Collected ($ millions) Fraser Lulu North Shore Vancouver Total 2019 TOTAL $49.919 $1.948 $1.373 $6.999 $60.239 2018 TOTAL $19.808 $1.890 $1.460 $4.959 $28.117
Performance and Audit Committee Semi-Annual Report on GVS&DD Development Cost Charges Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 2 of 3
The DCC collections are net of waivers for qualifying affordable housing developments under the GVS&DD DCC Waiver for Affordable Housing Bylaw, No. 314, 2018, adopted in May 2018. Previously, waivers were permitted under GVS&DD DCC Bylaw No. 254, 2010. For 2019, DCC waivers were provided for 946 affordable housing units, located in the Fraser Sewerage Area (49%), Vancouver Sewerage Area (37%) and North Shore Sewerage Area (14%). This equates to approximately $1.5 million in forgone DCC collections. The amount forgone in 2019 (new rates) is similar to that for 2018 (previous rates) but the number of waived units has declined by 46% (2018 - 1,761 units.)
Currently, DCC collections are in excess of the actual annual funding requirements for growth related projects. However, as illustrated in the 2020 - 2024 Financial Plan endorsed by the Board last fall, DCC utilization due to growth projects is expected to increase significantly in the short term.
APPLICATION OF DCC FUNDING The 2019 funding applications to be approved through Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020 are shown below:
DCC Funding Applied ($ millions) Fraser Lulu North Shore Vancouver Total 2019 DCC’s Applied-Total $125.621 $0.000 $1.262 $25.506 $152.389 2019 DCC Applied-Debt $25.621 $0.000 $1.262 $3.506 $30.389 2019 DCC Applied-Capital $100.000 $0.000 $0.000 $22.000 $122.000 2018 DCC’s Applied $8.107 $0.001 $0.733 $1.919 $10.760
Each year, the sewerage growth capital projects that are undertaken are funded through long term debt financing utilizing a 15-year amortization period, for which the DCC’s are used to pay for the principal portion of the borrowing, or be applied directly for growth capital expenditures. Excess DCC collections are maintained as deferred revenues for future application as required. The DCC deferred revenue balances as at December 31, 2019 by Area were as follows:
Fraser Sewer Area $147,639,413 Lulu Island Sewer Area 24,462,851 North Shore Sewer Area 10,860,923 Vancouver Sewer Area 44,588,063 $227,551,250
A review of the DCC program was completed late in 2017 which resulted in the implementation of new DCC rates effective May 1, 2018 to generate additional future funding of regional growth requirements. The next review of DCC rates is expected to occur in 2020/2021.
ALTERNATIVES This is an information report. No alternatives are presented.
Performance and Audit Committee Semi-Annual Report on GVS&DD Development Cost Charges Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 3 of 3
FINANCIAL IMPLICATIONS The DCC program was established pursuant to the concept of “growth pays for growth”. Should the collections be inadequate to fund the Sewerage growth related projects, the funding burden would default to Sewer levies collected from the GVS&DD member municipalities.
SUMMARY / CONCLUSION DCC collections for 2019 were $60.2 million. DCC’s received are used to pay for the principal portion of the borrowing or directly for capital expenditures for growth related GVS&DD projects or for both. As the requirement for capital projects related to growth is substantial and continues to grow, a review of the DCC program rates was completed late in 2017 which resulted in rates increasing effective May 1, 2018. The next review of DCC rates is expected to occur in 2020 / 2021.
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5.5
To: Performance and Audit Committee
From: Dean Rear, General Manager, Financial Services/Chief Financial Officer
Date: April 27, 2020 Meeting Date: May 6, 2020
Subject: Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020
RECOMMENDATION That the GVS&DD Board: a) give first, second and third reading to Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020; and b) pass and finally adopt Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020.
EXECUTIVE SUMMARY Utilization of Development Cost Charge’s are required to be approved by the GVS & DD Board by bylaw. The attached DCC Expenditure Bylaw No. 339, 2020 to be provides authority for 2019 annual funding applied for growth capital debt servicing amounts and growth capital project expenditures. In total $152.4 million of DCC’s were applied for 2019 over three sewerage areas.
Total DCC’s held in reserve at December 31, 2019 was $227.5 million.
PURPOSE To meet the statutory requirements to use Development Cost Charges (DCC’s) for funding of the liquid waste growth capital program. This bylaw completes the authority for the required transfer of DCC’s to fund the 2019 growth capital projects.
BACKGROUND The regional sewer development cost charges are governed under the GVS&DD Act and were introduced in 1997, pursuant to the philosophy that “growth pays for growth”. Funds received through the collection of DCC’s are set aside as deferred revenue in reserve accounts on a sewerage area basis for the funding of growth capital projects. This use of DCC revenue funding reduces the reliance on the sewer levy which is generated directly from the GVS&DD’s member municipalities.
Under the Act, transfers of any revenues collected out of the DCC Reserve Funds can only be for the purposes intended and must be authorized by bylaw. This report brings forward the bylaw required for the authority to transfer DCC revenues to fund the 2019 growth debt and growth capital projects.
2019 DCC APPLICATIONS DCC’s are collected based on development in the region, held in reserve and applied either to fund the actual sinking fund payments on debt related to growth capital expenditures to enhance system capacity or to fund incurred growth capital project expenditures directly to avoid additional debt
Performance and Audit Committee GVS&DD Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 2 of 3
financing requirements. As a result of the volume of capital projects undertaken within the Liquid Waste Services function, long-term funding is not secured on a project by project basis but rather on a pooled basis by expenditure type (i.e. defined growth projects) by sewer area as funding is required.
As part of the year-end accounting processes, the actual DCC revenue requirements are determined and Board authority for the necessary reserve fund transfers is requested through the attached bylaw. The funding required for 2019, as set out in the annual financial statements, is $30.4 million for debt servicing and $122 million for direct capital funding. These applications are summarized by sewer area below:
Fraser Sewer Area $ 25,620,878 - debt $ 100,000,000 – direct capital
This funding relates to a series of growth related projects due to required expansions/upgrades of the liquid waste collection system and the wastewater treatment plants in the Fraser Sewerage Area.
North Shore Sewer area $ 1,262,345 - debt
This funding relates to growth related projects due to required expansions/upgrades of the liquid waste collection system and the wastewater treatment plant in the North Shore Sewer Area.
Vancouver Sewer Area $ 3,505,758 - debt $ 22,000,000 – direct capital
This funding relates to a series of growth related projects primarily due to required expansions/upgrades of the liquid waste collection system in the Vancouver Sewerage Area.
The balances in the DCC deferred revenue reserves at December 31, 2019, after the application of the growth funding amounts contemplated in this bylaw, are as follows:
Fraser Sewer Area $ 147,639,413 Vancouver Sewer Area 44,588,063 Lulu Island Sewer Area 24,462,851 North Shore Sewer area 10,860,923
$ 227,551,250
ALTERNATIVES 1. That the GVS&DD Board: a) give first, second and third reading to Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020; and b) pass and finally adopt Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020.
Performance and Audit Committee GVS&DD Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 3 of 3
2. That the GVS&DD Board receive for information the report titled “Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020”, dated April 27, 2020 and provide alternate direction.
FINANCIAL IMPLICATIONS This bylaw as presented under alternative one finalizes the required DCC funding for growth debt and capital as contemplated in the 2019 Liquid Waste Services budgeted operating and capital revenues.
Should this bylaw be amended or not approved, sewer levy funding may need to be used to fund debt on growth related capital expenditures rather that DCC’s as intended a part of the DCC program. This would reduce the funding available for the other areas of the service and likely lead to an increase in the levy to member municipalities.
SUMMARY / CONCLUSION The adoption of the bylaw as included under alternative one is recommended. The 2019 budget contemplated the transfer of DCC revenues collected to meet actual debt charge and capital funding requirements related to the Liquid Waste growth capital program. This bylaw completes that process.
Attachment: Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020.
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GREATER VANCOUVER SEWERAGE AND DRAINAGE DISTRICT BYLAW NUMBER 339, 2020 A Bylaw to Expend Development Cost Charge Reserve Fund
WHEREAS:
A. The Greater Vancouver Sewerage and Drainage District (the “Corporation”) enacted Development Cost Charge Bylaw 254, 2010, (further amended by Greater Vancouver Sewerage and Drainage District Amending Bylaws 286, 2014 and 292, 2015 and 305, 2017) which was effective as of April 23, 2010 (replacing repealed Development Cost Charge Bylaw 187, 1996, which was effective as of January 1, 1997), pursuant to which the Corporation has imposed development cost charges to assist the Corporation in paying capital costs incurred to provide, construct, alter or expand sewerage facilities to service development;
B. The Corporation has established a Development Cost Charge Reserve Fund pursuant to “Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Bylaw No. 188, 1997”, which was enacted pursuant to Section 58.6 of the Greater Vancouver Sewerage and Drainage District Act, into which fund the Corporation has deposited and continues to deposit the monies collected pursuant to Development Cost Charge Bylaw 254, 2010 (further amended by Greater Vancouver Sewerage and Drainage District Amending Bylaws 286, 2014 and 292, 2015 and 305, 2017) which was effective as of April 23, 2010 (replacing repealed Development Cost Charge Bylaw 187, 1996 which was effective as of January 1, 1997);
C. The Development Cost Charge Reserve Fund is divided into 4 separate accounts, pursuant to “Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Bylaw No. 188, 1997”, being the Fraser Area Account, the Lulu Island West Area Account, the North Shore Area Account and the Vancouver Area Account; and
D. The Corporation is authorized to pay from the Development Cost Charge Reserve Fund the capital costs of providing, constructing, altering or expanding sewerage facilities that relate to development within the area of the Corporation or principal and interest on a debt incurred by the Corporation as a result of an expenditure for the capital costs of providing, constructing, altering or expanding sewerage facilities that relate to development within the area of the Corporation.
NOW THEREFORE the Board of the Greater Vancouver Sewerage and Drainage District enacts as follows:
1. The sum of $25,620,878 held in the Fraser Area Account shall be paid out of such account and used to pay the portion of the principal on the debt incurred by the Corporation that has been apportioned to the Fraser Sewerage Area, which debt was incurred by the Corporation to pay for the capital costs of providing, constructing, altering or expanding sewerage facilities that relate to development within that area of the Corporation and the sum of $100,000,000 held in the Fraser Area Account shall be paid out of such account to fund capital apportioned to Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020 37812800 Page 1 of 2 Performance and Audit Committee
the Fraser Sewerage Area to pay for the capital costs of providing, constructing, altering or expanding sewerage facilities that relate to development within that area of the Corporation.
2. The sum of $1,262,345 held in the North Shore Area Account shall be paid out of such account and used to pay the portion of the principal on the debt incurred by the Corporation that has been apportioned to the North Shore Sewerage Area, which debt was incurred by the Corporation to pay for the capital costs of providing, constructing, altering or expanding sewerage facilities that relate to development within that area of the Corporation.
3. The sum of $3,505,758 held in the Vancouver Area Account shall be paid out of such account and used to pay the portion of the principal on the debt incurred by the Corporation that has been apportioned to the Vancouver Sewerage Area, which debt was incurred by the Corporation to pay for the capital costs of providing, constructing, altering or expanding sewerage facilities that relate to development within that area of the Corporation and the sum of $22,000,000 held in the Vancouver Area Account shall be paid out of such account to fund capital apportioned to the Vancouver Sewerage Area to pay for the capital costs of providing, constructing, altering or expanding sewerage facilities that relate to development within that area of the Corporation.
4. This bylaw may be cited as “Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020”.
Read a first, second and third time this ______day of ______, ______
Passed and finally adopted this ______day of ______, ______
Sav Dhaliwal, Chair
Chris Plagnol, Corporate Officer
Greater Vancouver Sewerage and Drainage District Development Cost Charge Reserve Fund Expenditure Bylaw No. 339, 2020 37812800 Page 2 of 2 Performance and Audit Committee
5.6
To: Performance and Audit Committee
From: Dean Rear, General Manager, Financial Services/Chief Financial Officer
Date: March 28, 2020 Meeting Date: May 6, 2020
Subject: Capital Program Expenditure Update as at December 31, 2019
RECOMMENDATION That the Performance and Audit Committee receive for information the report dated March 28, 2020, titled “Capital Program Expenditure Update as at December 31, 2019”.
EXECUTIVE SUMMARY Updates on the capital program and its expenditures are brought to the Committee to keep members informed on Metro Vancouver’s financial performance. This is the third and final report for the 2019 fiscal year. Attachment 4 provides a summary of the 2019 actual capital spending compared to the Board approved Capital Budget. Attachment 3 provides additional information and narrative by department regarding the spending variances outlined in Attachment 4.
For 2019, Metro Vancouver’s Capital expenditures were approximately 78.5% of budgeted and were underspent by $201.3 million. This underspending contributed to an overall surplus in capital funding of $10.3 million. This surplus, per policy, will be used in future years to fund capital and avoid debt.
PURPOSE To present the Committee with the final report on the financial performance of the capital program for the year ending December 31, 2019.
BACKGROUND Updates on the capital program and its expenditures are brought to the Committee to keep members informed on Metro Vancouver’s financial performance. These updates include the actual financial progress of Metro Vancouver’s capital expenditures compared to the approved spending limits.
Three updates are planned for the fiscal year 2019, which is consistent with the Performance and Audit Committee Terms of Reference. This is the third and final report for the 2019 fiscal year.
Separate reports containing the same financial information are also presented to the Water, Liquid Waste, Zero-Waste, Housing and Regional Parks Committees.
CAPITAL PROGRAM FUNDING The Metro Vancouver capital spending, for Liquid Waste, Solid Waste and Water are funded through the Operating Budget by a combination of contribution to capital (pay-as-you-go funding) and debt service costs (principal and interest payments) which is generated annually from the regional ratepayers. As a result, the annual impact on the ratepayers is significantly less than the level of budgeted capital expenditures. In 2019, the impact on the ratepayers for the Liquid Waste, Solid
37088768 Performance and Audit Committee Capital Program Expenditure Update as at December 31, 2019 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 2 of 5
Waste and Water Capital Budgets of $885.4 million is the capital funding of $315.4 million (contribution to capital and new debt service costs) included in the 2019 Operating Budget.
In the case of Regional Parks and Housing Services, capital spending is funded from existing reserves. Contribution to these capital reserves is generated from Housing rents and MVRD Tax Requisition. In the 2019, the impact on operating budgets for the Regional Parks and Housing Services capital budget of $54.3 million is the reserve contributions in both departments totaling $22.5 million.
OVERALL CAPITAL PROGRAM Liquid Waste, Solid Waste and Water Projects The overall capital programs for Liquid Waste, Solid Waste and Water comprise capital projects which require multiple years to complete. These projects are broken down into various phases such as project definition, pre-design, detailed design and construction. With the completion of each phase more information is learned for the appropriate costing of subsequent phases.
It is expected that the capital spending on all capital projects completed in 2019 or ongoing at some point in 2019 will be as follows:
• Liquid Waste Services under budget by $22.0 million, within 0.30% of budget • Solid Waste Services is trending over budget by $13.8 million, within 5.9% of budget • Water Services under budget by $8.8 million, within 0.12% of budget
Attachment 1 provides a summary of capital expenditures for Liquid Waste, Solid Waste and Water in terms of both ongoing and completed projects. Completed Projects include a summary of actual spending compared to the Board approved spending limits while the Ongoing Projects include a summary projected spending to completion compared to Board approved spending limits. With the rare exception, projects tend to complete with actual spending below the approved limits predominantly due to savings on budgeted contingency amounts.
Attachment 2 provides the details behind the summary information including specific capital projects, their status and any pertinent notes while Attachment 3 provides some additional project information of some of the key projects included in Attachment 2.
Regional Parks and Housing Services 2019 Capital Programs The financial planning process for Regional Parks and Housing Services include the approval of both an annual Operating Budget (contribution to reserves) and an annual Capital Program budget for planned capital infrastructure spending.
It is expected that the capital spending on all capital projects completed in 2019 or ongoing at some point in 2019 will be as follows:
• Regional Parks Capital was 97.1% of budgeted and underspent by approximately $0.6 million. • Housing Services was 75.5% of budgeted and underspent by approximately $7.9 million.
Performance and Audit Committee Capital Program Expenditure Update as at December 31, 2019 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 3 of 5
Any Capital Funding surpluses for Regional Parks or Housing Services are returned to their respective reserves to fund capital programs in 2020. Attachment 2 provides capital spending details for 2019 including a breakdown of Regional Parks and Housing capital programs where available. A summary of actual capital spending compared to the Board can be found in Attachment 4.
2019 CAPITAL PROGRAM PROGRESS The Metro Vancouver financial planning process included Board approval of both an annual Operating Budget (operations, contribution to capital and debt service) and an annual Capital Budget for the planned capital infrastructure projects. The annual Capital Budget comprises the projected spending for a list of capital projects either continuing or to be started within the calendar year. Projecting the spending on these projects represents somewhat of a timing exercise which is often subject to uncontrollable circumstances. These uncontrollable circumstances are more likely when projects are in certain phases of completion. Where a project is in the definition, pre-design or detailed design phases, it is more likely that a project may be subject to delays from necessary permitting, access, clarification of design details or procurement complexities which will result in a lag in spending. Conversely, when a project is within the construction phase where a contractor is in place and working effectively on site, actual spending is usually very close to budgeted expectations.
Attachment 4 provides a summary of the 2019 actual capital spending compared to the Board approved Capital Budget. Attachment 3 provides additional information and narrative by department regarding the spending variances outlined in Attachment 4.
The underspending of the annual Capital Budget in Liquid Waste, Solid Waste and Water Services will often translate to lower than budgeted debt servicing costs in the operating budget as borrowing is lower than anticipated and deferred to future years. Those savings along with any other operating surpluses in any year, remain with the applicable function, and are applied in the subsequent budget year to avoid debt thereby reduce the impact on ratepayers.
For 2019, Metro Vancouver’s Capital expenditures were approximately 78.5% of budgeted and were underspent by $201.3 million. This underspending contributed to an overall surplus in capital funding (Contribution to capital, reserve contributions and debt service costs) of $10.3 million.
Housing Services Annual capital expenditures for Housing was $24.2 million compared to an amended budget of $32.1 million, with the majority of the underspend being in housing re-development costs.
The amended Capital Budget of $32.1 million for Housing are to be funded through reserves. Any amounts unspent from 2019 will remain in their respective reserves for future use.
The “Status of Housing Services Capital Expenditures to December 31, 2019” included in Attachment 3 provides further information.
Performance and Audit Committee Capital Program Expenditure Update as at December 31, 2019 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 4 of 5
Liquid Waste Services Annual capital expenditures for Liquid Waste Services were $417.6 million compared to a capital budget of $564.9 million. The majority of the spending related to the Annacis Wastewater Treatment Plant Stage 5 Expansion project and the North Shore Wastewater Treatment Plant replacement.
The 2019 Operating Budget included capital funding of $175.8 million. As a result of the underspending of the 2019 Capital Budget, a surplus of $5.5 million in capital funding was realized to be used to offset debt in 2020.
The “Status of Liquid Waste Services Capital Expenditures to December 31, 2019” included in Attachment 3 provided further information.
Regional Parks Services Annual capital expenditures for Regional Parks were $18.8 million compared to an amended budget of $19.4 million, with the majority of the spending being for Parkland Acquisition.
The 2019 amended Capital Budget of $19.4 million for Regional Park is to be funded through reserves. Any amounts unspent from 2019 will remain in the reserve for future use.
The “Status of Regional Parks Capital Expenditures to December 31, 2019” included in Attachment 3 provides further information.
Solid Waste Services Annual capital expenditures for Solid Waste Services were $31.6 million compared to a budget of $89.2 million. A majority of spending occurring in the Transfer Station Capital category.
The 2019 Operating Budget included capital funding of $6.6 million. As a result of the underspending of the 2019 Capital Budget, a surplus of S2.7 million in capital funding was realized to be used to offset debt in 2020.
The “Status of Liquid Waste Services Capital Expenditures to December 31, 2019” included in Attachment 3 provides further information.
Water Services Annual capital expenditures for Water Services were $243.5 million compared to a capital budget of $231.4 million. A majority of spending occurred in the Growth and Resilience Capital categories.
The 2019 Operating Budget included capital funding of $175.8 million. As a result of capital activity during the year, all of this funding was used in 2019. This timing difference has been funded through the application of accumulated surplus generated from capital underspending in prior years.
The “Status of Water Services Capital Expenditures to December 31, 2019” included in Attachment 3 provides further information.
Performance and Audit Committee Capital Program Expenditure Update as at December 31, 2019 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 5 of 5
ALTERNATIVES This is an information report. No alternatives are presented.
FINANCIAL IMPLICATIONS For 2019, resulting primarily due to the timing of expenditures, Metro Vancouver’s Capital expenditures were approximately 78.5% of budgeted and were underspent by $201.3 million. This underspending contributed to an overall surplus in capital funding (Contribution to capital, reserve contributions and debt service costs) of $10.3 million
This surplus, per policy, will be used in future years to fund capital and avoid debt.
Regional Parks and Housing, whose capital expenditures are funded from reserves, will have no resulting surplus from the underspending of the 2019 Capital Budget as the monies will remain in the reserve. As the underspending is due to timing, these funds are expected to be expended in future years.
CONCLUSION In 2019 Metro Vancouver’s Capital expenditures were approximately 78.5% of budgeted and were underspent by $201.3 million. The majority of the capital program relates to Liquid Waste, Solid Waste and Water with the underspending due primarily to the timing of expenditures differing from expectations with delays experienced in projects in the early stages of completion. The underspending in the 2019 Capital Budget, resulted in a realization of a surplus in capital funding of $10.3 million. This surplus, per policy, will be used in future years to fund capital and avoid debt.
Although the 2019 Capital Budget was underspent overall, the variances are generally a result of timing with the actual overall spending on a capital project expected to be close to or less than the overall budget for that project due to the savings of any budgeted contingencies.
Attachments 1. Capital Expenditure Summary as at December 31, 2019 - Liquid Waste, Solid Waste and Water 2. Detailed Capital Expenditure Summaries – by Department 3. Capital Project Status Information – by Department 4. 2019 Capital Spending Summary as at December 31, 2019
37088768
Performance and Audit Committee ATTACHMENT 1
Metro Vancouver Capital Expenditure Summary As at December 31, 2019
Total Projected Total Budget Projected Variance to Completion Liquid Waste Services Ongoing $ 6,625,968,000 $ 6,658,462,000 $ 32,494,000 Completed 101,580,000 91,074,000 (10,506,000) Not Started 575,255,000 575,255,000 ‐ $ 7,302,803,000 $ 7,324,791,000 $ 21,988,000
Total Projected Total Budget Projected Variance to Completion Solid Waste Services Ongoing $ 208,153,000 $ 194,400,000 $ (13,753,000) Completed ‐ ‐ ‐ Not Started 37,150,000 37,150,000 ‐ $ 45,303,000 $ 231,550,000 $ (13,753,000)
Total Projected Total Budget Projected Variance to Completion Water Services Ongoing $ 6,239,708,000 $ 6,226,836,000 $ (12,872,000) Completed 27,985,000 35,643,000 7,658,000 Not Started 900,450,000 900,450,000 ‐ Cancelled 195,000 14,201,000 14,006,000 $ 7,168,338,000 $ 7,177,130,000 $ 8,792,000
Total $ 14,716,444,000 $ 14,733,471,000 $ 17 ,037,000
Performance and Audit Committee Metro Vancouver Housing Services Capital Expenditures Summary ATTACHMENT 2 - HOU As of December 31, 2019 January ‐ February #REF! #REF! #REF! Current Year
2019 2019 Budget Total 2019 Actual 2019 Remaining Project Name Project Location Budget Amendments Budget Expenditures Budget Status Notes / Comments
Grand Total Housing Services 31,318,242 775,000 32,093,242 24,217,017 7,876,225
Capital Replacement Projects 10,001,242 ‐ 10,001,242 9,385,746 615,496 Under budget due to permitting and design delays that resulted in funds being reallocated from some major replacement projects to interior renovations that included linoleum, water heater and cabinet replacement. Ongoing
MVHC Development Capital Housing Development‐Heather Place‐Building A Vancouver 12,150,000 ‐ 12,150,000 14,044,054 (1,894,054) Over budget in the current year due to previous construction delays in 2017/2018 which resulted in a majority of the work being completed Contstruction ‐ in 2019. Ongoing Housing Development‐Heather Place‐Building B Vancouver 25,000 25,000 ‐ 25,000 In discussions with the City of Vancouver regarding changes to design requested by MVHC Housing Committee. Development Permit ‐ ‐ Ongoing Housing Development‐Kingston 123 Surrey 9,167,000 ‐ 9,167,000 704,884 8,462,116 Design delayed due to City of Surrey design process (152 Street future corridor transportaion dedication). Original budget contemplated construction start in 2019. Demolition of existing townhouses began Development Permit ‐ in 2019. Ongoing Housing Development‐Welcher Avenue Port Coquitlam 750,000 750,000 82,333 667,667 Received authorization to proceed with the project early 2019. Estimated 2019 budget was associated with design consultants, environmental assessments and architects that were planned to proceed with work in 2019. RFQ and RFP created, issued, reviewed and awarded. Architect began work in late 2019. Schematic Design ‐ ‐ Ongoing 21,317,000 775,000 22,092,000 14,831,271 7,260,729
Grand Total Housing Services 31,318,242 775,000 32,093,242 24,217,017 7,876,225
2019 Housing Capital Expenditure Summary ‐ December / 2019 Housing Summary Performance andPage 1 of 1 Audit Committee 3/27/2020 Metro Vancouver ATTACHMENT 2 - LWS Liquid Waste Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 578 579 580 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments
Infrastructure Growth Capital AIWWTP Site Construction Layout Delta 600,000 65,943 534,057 600,000 ‐ 11% Ongoing N Delayed start to earlier phase. Albert Street Trunk Sewer Port Moody 5,550,000 2,682,537 2,867,463 5,550,000 ‐ 48% Ongoing Y Annacis Outfall System Delta 378,000,000 59,275,888 318,724,112 378,000,000 ‐ 16% Ongoing Y Annacis Stage 5 Expansion Phase 1 T1 & T2 Delta 243,500,000 241,078,656 2,421,344 243,500,000 ‐ 99% Ongoing Y Annacis Stage 5 Expansion Phase 2 Delta 22,000,000 16,065,401 5,934,599 22,000,000 ‐ 73% Ongoing Y Annacis Stage 5 Expansion Phase 2a Delta 180,000,000 125,111,983 54,888,017 180,000,000 ‐ 70% Ongoing Y Annacis Stage 5 Expansion Phase 2b Delta 150,000,000 12,755,206 137,244,794 150,000,000 ‐ 9% Ongoing Y Annacis Stage 5 Expansion Phase 2c Delta 90,000,000 ‐ 90,000,000 90,000,000 ‐ 0% Not Started N Construction anticipated to start in Q1 2020 due to site congestion Burnaby Lake North Interceptor Cariboo Section Burnaby 41,000,000 ‐ 41,000,000 41,000,000 ‐ 0% Not Started N Delayed to prioritize the Winston (upstream) section. Burnaby Lake North Interceptor Winston Section Burnaby 116,950,000 3,369,328 113,580,672 106,950,000 10,000,000 3% Ongoing Y (1) Burnaby South Slope Interceptor Main Branch Burnaby 9,500,000 ‐ 9,500,000 9,500,000 ‐ 0% Not Started Y Burnaby South Slope Interceptor West Branch Extension Burnaby 13,200,000 ‐ 13,200,000 13,200,000 ‐ 0% Not Started Y Cloverdale Pump Station Capacity Upgrade Surrey 31,100,000 201,565 30,898,435 31,100,000 ‐ 1% Ongoing N Slight delay to determine scope of upgrades Cloverdale Trunk Sewer Capacity Upgrade Surrey 29,000,000 ‐ 29,000,000 29,000,000 ‐ 0% Not Started Y Collingwood Trunk Sewer Vancouver 5,415,000 5,420,437 (5,437) 5,492,000 (77,000) 100% Completed Y Final restoration resulted in budget exceedance. Glenbrook Combined Trunk Kingsway Sanitary Section Burnaby 3,000,000 153,978 2,846,022 3,000,000 ‐ 5% Ongoing Y Golden Ears Forcemain and River Crossing Maple Ridge 86,000,000 4,364,048 81,635,952 83,989,000 2,011,000 5% Ongoing Y (1)(2) Golden Ears Pump Station Maple Ridge 50,200,000 3,160,130 47,039,870 50,200,000 ‐ 6% Ongoing Y Golden Ears SSO Storage Maple Ridge 51,500,000 4,583,714 46,916,286 37,358,000 14,142,000 9% Ongoing Y (1)(2) Hastings Sanitary Trunk Sewer Burnaby 15,031,000 11,106,074 3,924,926 13,031,000 2,000,000 74% Ongoing Y (1)(2) Hastings Sanitary Trunk Sewer No. 2 Burnaby 20,000,000 6,236,464 13,763,536 12,000,000 8,000,000 31% Ongoing Y (1)(2) Hastings‐Cassiar Intake Connection Vancouver 750,000 77,933 672,067 2,350,000 (1,600,000) 10% Ongoing N (6) Project delayed to confirm scope and consider improved functionality. Lozells Sanitary Trunk Golf Course Section Burnaby 27,650,000 ‐ 27,650,000 27,650,000 ‐ 0% Not Started N (3)(4) Project delayed to confirm scope of replacement and potential alternate alignments. Lulu Island WWTP Digester No 3 Richmond 53,300,000 1,392,114 51,907,886 53,300,000 ‐ 3% Ongoing N (4) Scope review under way. Marshend Pump Station Capacity Upgrade Burnaby 10,025,000 475,122 9,549,878 13,775,000 (3,750,000) 5% Ongoing N (6) Project delayed to confirm scope. NLWWTP Clarifiers Langley Township 64,300,000 54,039,594 10,260,406 54,039,000 10,261,000 100% Completed Y (1)(2) NLWWTP Ground Improvements Langley Township 83,000,000 22,524,084 60,475,916 83,000,000 ‐ 27% Ongoing Y NLWWTP Outfall Langley Township 159,000,000 ‐ 159,000,000 159,000,000 ‐ 0% Not Started N Scheduled to start in 2020 NLWWTP Property Purchase Langley Township 12,000,000 ‐ 12,000,000 12,000,000 ‐ 0% Not Started N Scheduled to start in 2021 NLWWTP Stage 1 Langley Township 889,000,000 4,605,124 884,394,876 889,000,000 ‐ 1% Ongoing Y North Road Trunk Sewer Coquitlam 7,675,000 3,032,546 4,642,454 11,675,000 (4,000,000) 40% Ongoing Y (6)(8) North Road Trunk Sewer Phase 2 Coquitlam 3,938,000 691,196 3,246,804 3,938,000 ‐ 18% Ongoing N Project construction deferred until 2022‐2023. North Vancouver Interceptor ‐ Lynn Branch Pre‐build Dist of North Van 3,950,000 292,209 3,657,791 3,950,000 ‐ 7% Ongoing Y NSI Flow Management Surrey 42,500,000 4,209,782 38,290,218 63,200,000 (20,700,000) 10% Ongoing N (6) Project delayed to improve scope definition and delivery method. Port Moody Pump Station Capacity Upgrade Port Moody 9,755,000 455,619 9,299,381 10,550,000 (795,000) 5% Ongoing N (6) Project delayed to confirm scope. Port Moody South Interceptor Capacity Upgrade Port Moody 3,450,000 ‐ 3,450,000 3,450,000 ‐ 0% Not Started Y Rosemary Heights Pressure Sewer Capacity Upgrade Surrey 10,750,000 ‐ 10,750,000 10,750,000 ‐ 0% Not Started Y Sapperton Forcemain Pump Station Connections New Westminster 10,000,000 10,035,474 (35,474) 10,036,000 (36,000) 100% Completed Y Sapperton Pump Station New Westminster 82,003,000 64,358,190 17,644,810 73,003,000 9,000,000 78% Ongoing N (1) Project experiencing minor delays due to construction issues. Commissioning expected in Q4 2020. South Surrey Interceptor Johnston Section Surrey 66,176,000 46,736,833 19,439,167 84,026,000 (17,850,000) 71% Ongoing N (6) Final section delayed due to protracted property and permitting issues. Sperling PS Increase Pump Capacity Burnaby 3,150,000 2,805,027 344,973 2,590,000 560,000 89% Ongoing Y (2) SSI ‐ King George Section ‐ Odor Control Facility (OCF) and Grit Chamber Surrey 19,500,000 8,671,080 10,828,920 18,300,000 1,200,000 44% Ongoing N (1)(2) Project is proceeding at a slower pace than expected due to construction issues. Surrey Central Valley Capacity Upgrade Surrey 60,800,000 ‐ 60,800,000 60,800,000 ‐ 0% Not Started Y Scheduled to start in 2021. 3,164,218,000 720,033,280 2,444,184,720 3,155,852,000 8,366,000
Infrastructure Maintenance Capital AIWWTP Fibre Optic Infrastructure Delta 1,500,000 128,621 1,371,379 1,500,000 ‐ 9% Ongoing Y AIWWTP Gravity Thickner and DAF Steel Repair and Recoating Delta 2,000,000 1,796,275 203,725 1,800,000 200,000 90% Ongoing Y (2) AIWWTP Influent System Remediation Delta 82,600,000 127,408 82,472,592 82,600,000 ‐ 0% Ongoing Y AIWWTP IPS Pump Building Roof Replacement Phase 2 Delta 830,000 ‐ 830,000 830,000 ‐ 0% Not Started N (4) Deferred to 2024 based on results of detailed condition assessment. AIWWTP Outfall Repair Delta 2,300,000 ‐ 2,300,000 2,300,000 ‐ 0% Not Started N (4) Scope review underway to account for new inspection information. AIWWTP Replacement of ICS Equipment in Galleries Delta 2,895,000 1,419,740 1,475,260 2,895,000 ‐ 49% Ongoing Y AIWWTP Scheduled 64kV Potential & Current Transformer Replacements Delta 800,000 ‐ 800,000 800,000 ‐ 0% Not Started N Anticipated to start in 2020. AIWWTP SCL Flow Balancing Delta 2,450,000 913,895 1,536,105 2,450,000 ‐ 37% Ongoing Y 2019 LWS Capital Expenditure Summary ‐ December / Lifetime FD602 Liquid Waste Performance andPage 1 of 4 Audit Committee 3/24/2020 Metro Vancouver Liquid Waste Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 578 579 580 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments AIWWTP SCL Flow Control Delta 63,500,000 1,906,335 61,593,665 31,500,000 32,000,000 3% Ongoing Y (1)(2) AIWWTP Secondary Effluent Discharge Flowmeter Replacement Delta 400,000 32,839 367,161 400,000 ‐ 8% Ongoing Y AIWWTP Spare Trickling Filter Pump & Motor Purchase Delta 1,950,000 ‐ 1,950,000 1,950,000 ‐ 0% Not Started N (3) AIWWTP Station Battery Replacement ‐ PHASE 2 Delta 400,000 59,003 340,997 400,000 ‐ 15% Ongoing Y AIWWTP Trickling Filter Media & Distributor Arms & Ducting Replacement Delta 57,900,000 504,244 57,395,756 57,900,000 ‐ 1% Ongoing Y Annacis Island WWTP ‐ ICS Component Replacement and Upgrade Program Delta 1,500,000 1,031,246 468,754 1,500,000 ‐ 69% Ongoing Y Annacis MCC 80 051, 80 070, 80 071 Replacement Delta 2,844,000 1,662,571 1,181,429 2,844,000 ‐ 58% Ongoing Y Annacis Secondary Clarifier Corrosion Repair Delta 2,534,000 1,941,316 592,684 1,941,000 593,000 100% Completed Y (2) Annacis Secondary Clarifier Corrosion Repair and Leveling Phase 2 Delta 22,000,000 7,809,163 14,190,837 22,000,000 ‐ 35% Ongoing Y Big Bend Forcemain ‐ Gate Replacement Richmond 2,680,000 70,209 2,609,791 2,680,000 ‐ 3% Ongoing Y Cambie Trunk Sewer Relocation for Broadway Subway Project Vancouver 4,500,000 ‐ 4,500,000 4,500,000 ‐ 0% Not Started N Project scope under review. Combined Sewer Overflow Sampling Station Enhancements Regional 1,900,000 82,947 1,817,053 1,900,000 ‐ 4% Ongoing Y Cost Allocation Billing Network (Combined 96 F4) Regional 5,230,000 5,098,591 131,409 5,230,000 ‐ 97% Ongoing Y Crescent Beach FM ‐ Replacement Surrey 21,515,000 1,808,895 19,706,105 21,515,000 ‐ 8% Ongoing Y English Bay/Balaclava Outfalls Improvement Vancouver 900,000 ‐ 900,000 900,000 ‐ 0% Not Started N Scheduled to start in 2021. FSA Flow Metering Program Regional 2,700,000 563,955 2,136,045 2,700,000 ‐ 21% Ongoing Y Gilbert/Brighouse Trunk Pressure Sewer Rehab Phase 5 Richmond 23,200,000 ‐ 23,200,000 23,200,000 ‐ 0% Not Started N Scheduled to start in 2023. Gilbert/Brighouse Trunk Pressure Sewer Twinning Phase 2 Richmond 50,501,000 31,803,624 18,697,376 50,501,000 ‐ 63% Ongoing Y Gilbert/Brighouse Trunk Pressure Sewer Twinning Phase 3 Richmond 44,400,000 11,570,027 32,829,973 44,400,000 ‐ 26% Ongoing Y Gilbert/Brighouse Trunk Pressure Sewer Twinning Phase 4 Richmond 41,400,000 1,010,031 40,389,969 41,400,000 ‐ 2% Ongoing Y Glen Eagles Forcemains Replacement Phase 2 West Vancouver 7,750,000 174,187 7,575,813 7,750,000 ‐ 2% Ongoing Y Glen Eagles Pump Stations Phase 1 West Vancouver 17,500,000 361,580 17,138,420 17,500,000 ‐ 2% Ongoing Y Glen Eagles Pump Stations Phase 2 West Vancouver 25,000,000 ‐ 25,000,000 25,000,000 ‐ 0% Not Started Y Harbour West & East Interceptors Reloc & Protect Vancouver 19,500,000 656 19,499,344 19,500,000 ‐ 1% Ongoing Y IIWWTP Digester 4 Roof Replacement & Mixing Replacement Richmond 24,800,000 13,302,032 11,497,968 24,800,000 ‐ 54% Ongoing Y IIWWTP Grit System Refurbishment Richmond 8,100,000 7,490,139 609,861 8,100,000 ‐ 92% Ongoing Y IIWWTP HVAC upgrade Richmond 2,095,000 2,017,702 77,298 2,018,000 77,000 100% Completed Y (2) IIWWTP ICS IPS Control Replacement Richmond 1,750,000 ‐ 1,750,000 1,750,000 ‐ 0% Not Started Y IIWWTP Influent Gate Refurbishment Richmond 1,350,000 151,171 1,198,829 1,350,000 ‐ 11% Ongoing Y IIWWTP Maintenance and Administration Building HVAC Richmond 550,000 442,054 107,946 442,000 108,000 100% Completed Y (2) IIWWTP MCC/Power Distribution Assess/Replace ‐ Phase 2 Richmond 1,000,000 595,292 404,708 800,000 200,000 60% Ongoing Y (2) IIWWTP PA‐Sed Tank & Gallery Wall Refurbishment Richmond 1,375,000 ‐ 1,375,000 1,375,000 ‐ 0% Not Started N Work delayed to confirm scope of repair. IIWWTP Replacement of CoGen Control System Richmond 2,470,000 942,950 1,527,050 2,470,000 ‐ 38% Ongoing Y IIWWTP Sed Tank Trough Replacement Richmond 1,600,000 1,498,627 101,373 1,499,000 101,000 100% Completed Y (2) IIWWTP Siphon Chamber Refurbishment Richmond 2,200,000 ‐ 2,200,000 2,200,000 ‐ 0% Not Started N Project delayed to allow improved coordination of other related works and improve safe operating conditions for work site. IIWWTP Solids Handling Refurbishment Richmond 30,500,000 29,987,867 512,133 30,436,000 64,000 98% Ongoing Y (2) IIWWTP Water Supply Richmond 6,500,000 78,954 6,421,046 6,500,000 ‐ 1% Ongoing N (4) Project will proceed in approximately 5yrs when YVR plans to realign Ferguson Rd northward. Iona Island Control & Instrumentation Replacement 2011 Richmond 2,750,000 1,933,079 816,921 2,750,000 ‐ 70% Ongoing Y Iona MCC/Power Distribution Assess/Replace 2010 Richmond 953,000 788,484 164,516 803,000 150,000 83% Ongoing Y (2) Iona MCC/Power Distribution Assess/Replace Future Years Richmond 1,965,000 1,304,442 660,558 1,350,000 615,000 66% Ongoing Y (2) Lions Gate Control and Instrumentation Replacement 2011 West Vancouver 600,000 193,907 406,093 214,000 386,000 100% Completed Y (7) LIWWTP ‐ Process Waste Drainage (PWD) Replacement Richmond 600,000 541,082 58,918 541,000 59,000 100% Completed Y (2) LIWWTP CCT Isolation Gates Richmond 2,050,000 182,687 1,867,313 2,050,000 ‐ 9% Ongoing Y LIWWTP Fibre Optic Infrastructure Richmond 600,000 345,317 254,683 600,000 ‐ 58% Ongoing Y LIWWTP High Efficiency Boiler Richmond 730,000 57,535 672,465 730,000 ‐ 8% Ongoing N (4) Deferred to after Biogas Cleanup Project is completed and in operation. LIWWTP ICS Component Replacement Richmond 360,000 269,986 90,014 360,000 ‐ 75% Ongoing Y LIWWTP PA‐Sed Tank Refurbishment Richmond 4,115,000 16,584 4,098,416 4,115,000 ‐ 0% Ongoing Y LSA Flow Metering Program Richmond 300,000 76,399 223,601 300,000 ‐ 25% Ongoing Y Marshend PS Rehab Burnaby 7,000,000 814,200 6,185,800 7,000,000 ‐ 12% Ongoing N Project delayed to confirm scope. New West Interceptor Grit Chamber New Westminster 8,250,000 214,125 8,035,875 8,250,000 ‐ 3% Ongoing Y New Westminster Interceptor Repair Columbia St. Section New Westminster 10,882,000 977,886 9,904,114 10,882,000 ‐ 9% Ongoing Y NLWWTP Screw Pump Replacement Langley City 1,550,000 67,455 1,482,545 1,550,000 ‐ 4% Ongoing Y NSA Flow Metering Program West Vancouver 300,000 90,256 209,744 300,000 ‐ 30% Ongoing Y NSI Rehab or Replacement Surrey 24,750,000 629,013 24,120,987 24,750,000 ‐ 3% Ongoing N Project delayed to improve scope definition, and coordination with other works. NWI ‐ Annacis Section 2 Improvement Delta 45,000,000 222,854 44,777,146 45,000,000 ‐ 1% Ongoing N Project delayed to improve scope definition, and coordination with other works. NWL WWTP 25 kV Substation Replacement Langley Township 10,025,000 3,508,559 6,516,441 9,475,000 550,000 35% Ongoing Y (1) NWL WWTP ICS System Hardware Upgrade Langley Township 1,500,000 1,415,894 84,106 1,500,000 ‐ 94% Ongoing Y Ocean Park Trunk Crescent Section (OPC) Pipe Rehabilitation/Replacement Surrey 403,000 218,708 184,292 403,000 ‐ 54% Ongoing N Property acquisition delays. Ocean Park Trunk Manholes Lining Surrey 550,000 ‐ 550,000 550,000 ‐ 0% Not Started Y
2019 LWS Capital Expenditure Summary ‐ December / Lifetime FD602 Liquid Waste Performance andPage 2 of 4 Audit Committee 3/24/2020 Metro Vancouver Liquid Waste Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 578 579 580 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments Royal Ave PS Rehabilitation New Westminster 4,218,000 1,070,366 3,147,634 6,740,000 (2,522,000) 25% Ongoing N (4)(6) Scope to be reviewed pending final result of hydraulic study.
Sewer Relocations and Protections at Fraser Surrey Docks Surrey 24,200,000 ‐ 24,200,000 24,200,000 ‐ 0% Not Started N Scheduled to start in 2020. Sewer Relocations and Protections for Pattullo Bridge Replacement Project New Westminster 7,000,000 ‐ 7,000,000 7,000,000 ‐ 0% Not Started N Project start based on 3rd party bridge contractor. South Surrey Interceptor Fraser River Crossing Scour Protection Delta 2,200,000 3,107,363 (907,363) 3,127,000 (927,000) 141% Ongoing Y (8) Surrey Corrosion Control Facility Replacement Surrey 2,900,000 121,060 2,778,940 2,900,000 ‐ 4% Ongoing N Project delayed to resolve siting issues. VSA Flow Metering Program Regional 3,200,000 227,391 2,972,609 3,200,000 ‐ 7% Ongoing Y Westridge FM Replacement Burnaby 3,650,000 331,129 3,318,871 3,450,000 200,000 9% Ongoing Y (9) Westridge Pump Stations 1 & 2 Refurbishment Burnaby 15,950,000 243,118 15,706,882 15,950,000 ‐ 2% Ongoing Y WWTPs Electrical System Studies & Upgrades Regional 750,000 ‐ 750,000 750,000 ‐ 0% Not Started N (4) Awaiting completion of AI Stage 5 Ph1 and AI Cogen projects studies. 790,670,000 147,353,025 643,316,975 758,816,000 31,854,000
Infrastructure Resilience Capital AIWWTP 69 kV Substation Modifications Delta 8,500,000 154,793 8,345,207 2,750,000 5,750,000 2% Ongoing Y Project under expenditure as BC Hydro requirements less than anticipated. AIWWTP Automation of Influent Gates Delta 3,700,000 3,583,620 116,380 3,700,000 ‐ 97% Ongoing Y AIWWTP Cogeneration Backup Power Delta 75,003,000 61,628,588 13,374,412 70,277,000 4,726,000 95% Ongoing Y (1)(2) AIWWTP PST Area Walkway & Column Remediation Delta 3,100,000 1,193,768 1,906,232 3,100,000 ‐ 39% Ongoing Y FSA Easement Acquisition Regional 1,500,000 1,161,122 338,878 1,500,000 ‐ 77% Ongoing Y (3) FSA Sewer Seismic Upgrades Implementation Regional 187,100,000 551,886 186,548,114 187,100,000 ‐ 1% Ongoing N (4) On hold until completion of work plan. Highbury Interceptor Air Treatment Facilities Vancouver 11,500,000 11,385,072 114,928 12,000,000 (500,000) 99% Ongoing N Budget shortfall and project delays due to construction related issues. IIWWTP ‐ Biogas Lines Relocation Richmond 5,780,000 2,143,579 3,636,421 5,780,000 ‐ 37% Ongoing Y IIWWTP Standby Diesel Generators Richmond 8,500,000 2,126 8,497,874 8,500,000 ‐ 1% Ongoing Y LIWWTP Power Reliability Richmond 5,702,000 562,506 5,139,494 8,257,000 (2,555,000) 10% Ongoing Y (6) Ocean Park Trunk Crescent Section (OPC) Pipe Rehabilitation/Replacement Surrey 4,550,000 ‐ 4,550,000 4,550,000 ‐ 0% Not Started N Property acquisition delays. SSI Sulfide Odour and Corrosion Control Delta 7,700,000 837,267 6,862,733 7,700,000 ‐ 11% Ongoing Y VSA Easement Acquisition Program Vancouver 670,000 458,784 211,216 670,000 ‐ 68% Ongoing Y (3) VSA Emergency Backup Power Vancouver 20,510,000 4,431,409 16,078,591 24,310,000 (3,800,000) 22% Ongoing Y (6) 343,815,000 88,094,519 255,720,481 340,194,000 3,621,000
Infrastructure Upgrade ‐ Advanced Treatment Capital Iona Secondary Treatment Upgrade Richmond 1,904,500,000 10,334,580 1,894,165,420 1,904,500,000 ‐ 1% Ongoing Y (5) North Shore WWTP Secondary Upgrade and Conveyance Dist of North Van 777,900,000 145,403,298 632,496,702 777,900,000 ‐ 19% Ongoing Y (5) Property Rights Dist of North Van ‐ 22,000,000 (22,000,000) 22,000,000 (22,000,000) 100% Completed Y 2,682,400,000 177,737,878 2,504,662,122 2,704,400,000 (22,000,000)
Infrastructure Upgrade Capital 8th Avenue Interceptor Air Treatment Facilities Vancouver 14,200,000 257,716 13,942,284 14,200,000 ‐ 2% Ongoing Y (4) Pre‐design in progress with construction deferred beyond 10 year capital plan. AIWWTP Ammonia Removal – Sidestream Delta 112,900,000 733,551 112,166,449 112,900,000 ‐ 1% Ongoing Y (4) Continuing with data collection with more analyses in 2022 to confirm study results. AIWWTP DAF Polymer Building Replacement Regional 550,000 433,180 116,820 550,000 ‐ 79% Ongoing Y AIWWTP Electrical Distribution System Protection Control and Monitoring Delta 2,650,000 18,059 2,631,941 2,650,000 ‐ 1% Ongoing Y AIWWTP Replacement of Protective Relays Delta 3,258,000 1,887,575 1,370,425 3,258,000 ‐ 58% Ongoing Y AIWWTP Secondary Bypass Delta 1,725,000 1,512,028 212,972 1,550,000 175,000 88% Ongoing Y (2) All WWTPs Power Quality Monitoring & Outage Alarming Network Regional 2,870,000 1,195,545 1,674,455 2,870,000 ‐ 42% Ongoing Y Biosolids Dryer Langley City 14,700,000 ‐ 14,700,000 14,700,000 ‐ 0% Not Started N Property purchase delayed. FSA Wastewater Meter Upgrades Regional 600,000 585,262 14,738 600,000 ‐ 98% Ongoing Y Glenbrook Combined Trunk Sewer Separation New Westminster 74,950,000 136,183 74,813,817 74,950,000 ‐ 1% Ongoing Y IIWWTP Biosolids Dewatering Facility Richmond 61,300,000 15,516,743 45,783,257 61,300,000 ‐ 25% Ongoing Y IIWWTP Provision of a Redundant 12.5 kV Feeder to Switch House Richmond 850,000 265,437 584,563 300,000 550,000 31% Ongoing Y (1)(2) Lions Gate SludgeLions Gate Sludge Thickener No. 2 West Vancouver 3,380,000 3,358,080 21,920 3,358,000 22,000 100% Completed Y (2) LIWWTP Ammonia Removal Richmond 600,000 199,949 400,051 600,000 ‐ 33% Ongoing Y (4) Continuing with data collection with more analyses in 2022 to confirm study results. New CSO Management Gates for New Westminster Interceptor New Westminster 5,925,000 62,629 5,862,372 5,925,000 ‐ 1% Ongoing Y NSSA Wastewater Meter Upgrades Regional 300,000 83,920 216,080 300,000 ‐ 28% Ongoing Y Sperling Pump Station Upgrade Burnaby 7,500,000 7,091,577 408,423 7,500,000 ‐ 95% Ongoing Y SSI Influent Control Chamber Repair and Replace Gates Delta 1,305,000 13,554 1,291,446 1,305,000 ‐ 1% Ongoing Y VSA Wastewater Meter Upgrades Vancouver 464,000 389,074 74,926 464,000 ‐ 84% Ongoing Y WWTPs Electrical System Studies & Upgrades Regional 1,150,000 ‐ 1,150,000 1,150,000 ‐ 0% Not Started Y Project scheduled to start in 2021 311,177,000 33,740,062 277,436,938 310,430,000 747,000
Opportunity Capital
2019 LWS Capital Expenditure Summary ‐ December / Lifetime FD602 Liquid Waste Performance andPage 3 of 4 Audit Committee 3/24/2020 Metro Vancouver Liquid Waste Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 578 579 580 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments AIWWTP Hydrothermal Processing Pilot Delta 8,980,000 199,559 8,780,441 8,980,000 ‐ 2% Ongoing Y Fraser Sewerage Area Integrated Resource Recovery (IRR) Study Regional 1,200,000 ‐ 1,200,000 1,200,000 ‐ 0% Not Started Y LIWWTP Biogas Clean‐up Project Richmond 12,331,000 4,391,280 7,939,720 12,331,000 ‐ 36% Ongoing Y LIWWTP Pilot Digestion Optimization Facility Richmond 2,500,000 639,947 1,860,053 3,100,000 (600,000) 26% Ongoing Y (6) North Surrey Interceptor ‐ Port Mann Section ‐ Odour Control Surrey 7,500,000 98,647 7,401,353 7,500,000 ‐ 1% Ongoing Y 32,511,000 5,329,433 27,181,567 33,111,000 (600,000) Grand Total Liquid Waste Services 7,324,791,000 1,172,288,197 6,152,502,803 7,302,803,000 21,988,000
Notes: (1) Project will be completed under budget ‐ savings due to competitive pricing. (2) Full contingency not required. (3) Funds will be spent if/when opportunity arises. (4) Project on hold. (5) Separate quarterly status reports for the Secondary Wastewater Treatment Upgrade projects are being provided to the Liquid Waste Committee and Board. (6) Additional budget included in 2020 Capital Plan. (7) No further control system upgrade work is anticipated at Lions Gate WWTP as a new North Shore Secondary Wastewater Treatment Plant is being built to replace it. (8) Project over budget due to tender price higher than engineer's estimate. (9) Design work done in house resulting in lower cost.
2019 LWS Capital Expenditure Summary ‐ December / Lifetime FD602 Liquid Waste Performance andPage 4 of 4 Audit Committee 3/24/2020 ATTACHMENT 2 - PARKS Metro Vancouver Regional Parks Capital Expenditures Summary As of December 31, 2019 September #REF! #REF! #REF! Current Year
2019 2019 Budget Total 2019 Actual 2019 Remaining Project Name Project Location Budget Amendments Budget Expenditures Budget Status Notes / Comments
Regional Parks Capital Expenditures Summary 15,855,000 11,125,000 19,410,000 18,845,222 564,778
Capital Maintenance Projects 3,175,000 ‐ 3,175,000 3,583,541 (408,541) Due to updated condition assessment information, there were some immediate repairs required for septic systems and buildings.
Parkland Acquisition Projects Codd Wetlands ‐ West Thompson Mountain Pitt Meadows ‐ 7,300,000 7,300,000 7,370,648 (70,648) Completed 53.8 ha on west side of Thompson Mountain Minnekhada ‐ Quarry Road Coquitlam ‐ 2,025,000 2,025,000 2,041,695 (16,695) Completed 15.95 ha adjoining northeast corner of Minnekhada Regional Park Kanaka Creek ‐ 252nd Street Maple Ridge ‐ 1,085,000 1,085,000 1,097,759 (12,759) Completed 2.95 ha on North Arm of Kanaka Creek North Alouette Regional Greenway Maple Ridge 715,000 715,000 726,824 (11,824) Completed 7.68 ha adjacent to the North Alouette Regional Greenway 7,570,000 11,125,000 11,125,000 11,236,926 (111,926)
Capital Development Projects Colony Farm ‐ Sheep Paddocks Trail Rebuild Port Coquitlam 2,690,000 ‐ 2,690,000 3,063,066 (373,066) Substantially Tender price higher than expected complete
Crippen ‐ New Service Yard Bowen Island 750,000 ‐ 750,000 5,307 744,693 Ongoing Project delayed due to permitting issues around soil contamination. Rebudgeted for 2020. Aldergrove ‐ Implement Management Plan Langley 690,000 ‐ 690,000 283,823 406,177 Ongoing Project split into phases. Phase 1 and 2 complete, Phase 3 rescheduled for 2021.
Capilano ‐ New Service Yard North Vancouver 500,000 ‐ 500,000 42,974 457,026 Ongoing Site selection took longer than expected, design initiated in 2019. Construction was rebudgeted for 2020 Colony Farm ‐ Service Yard Building Replacement Port Coquitlam 230,000 ‐ 230,000 148,183 81,817 Ongoing Construction started in Q4 2019 ‐ project will be complete in early 2020.
Belcarra ‐ South Picnic Area Cabins Belcarra 150,000 ‐ 150,000 200,924 (50,924) Ongoing Decision to increase scope of design to enable development of a Class B cost estimate. Belcarra ‐ Septic System Replacements Belcarra 50,000 ‐ 50,000 163,444 (113,444) Ongoing This project was deferred and the funding re‐allocated to the Water Connection Project Small Capital Replacement and Development Projects Regional 50,000 ‐ 50,000 25,817 24,183 Ongoing Small projects for Kanaka Watershed Stewardship Center and the Derby Washroom design
Crippen ‐ Davies Orchard Cabins Bowen Island ‐ ‐ ‐ 91,217 (91,217) Ongoing Project budgeted in 2018, design phase was extended to better match construction phases in forecast years in the financial plan. 5,110,000 ‐ 5,110,000 4,024,755 1,085,245
Grand Total Regional Parks 15,855,000 11,125,000 19,410,000 18,845,222 564,778
2019 Regional Parks Capital Expenditure Summary ‐ December Performance andPage 1 of 1 Audit Committee 3/23/2020 37299884 Metro Vancouver ATTACHMENT 2 - SWS Solid Waste Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 97 98 99 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Name Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments
Infrastructure Opportunity Program WTE Facility District Heating Opportunities Burnaby 2,300,000 ‐ 2,300,000 2,300,000 ‐ 0% Not Started N 2,300,000 ‐ 2,300,000 2,300,000 ‐
Landfills Coquitlam Landfill Closure Coquitlam 5,000,000 1,828,442 3,171,558 5,000,000 ‐ 37% Ongoing Y Coquitlam Landfill East Closure Coquitlam 5,000,000 ‐ 5,000,000 5,000,000 ‐ 0% Not Started N Dependent on area development Coquitlam Landfill Fly Ash Cell 2 Closure Final Cover Coquitlam 3,200,000 1,143,025 2,056,975 3,200,000 ‐ 36% Ongoing Y Coquitlam Landfill Gas Collection Upgrades Phase II Coquitlam 3,300,000 1,000,147 2,299,853 3,300,000 ‐ 30% Ongoing Y Coquitlam Landfill Pump Station Upgrade Coquitlam 600,000 15,976 584,024 600,000 ‐ 3% Ongoing Y Coquitlam Landfill: Leachate Collection System Grade Realignment Coquitlam 1,000,000 ‐ 1,000,000 1,000,000 ‐ 0% Not Started N Coordinating with other Coquitlam Landfill work.
18,100,000 3,987,590 14,112,410 18,100,000 ‐
Transfer Station System Coquitlam Transfer Station Compactor Replacement Coquitlam 2,000,000 ‐ 2,000,000 2,000,000 ‐ 0% Ongoing Y Coquitlam Transfer Station Replacement Coquitlam 70,200,000 28,242,319 41,957,681 77,600,000 (7,400,000) 40% Ongoing N Construction timing extended. Budget increase approved to address building permit and subdivision requirements. Maple Ridge Transfer Station Upgrades Maple Ridge 2,000,000 ‐ 2,000,000 2,000,000 ‐ 0% Not Started N North Shore Transfer Station Compactor Replacement Dist of North Van 2,000,000 ‐ 2,000,000 2,000,000 ‐ 0% Not Started N Surrey Recycling and Waste Drop‐Off Surrey 42,300,000 3,071,110 39,228,890 50,300,000 (8,000,000) 7% Ongoing Y Budget increase approved based on final class A cost estimate Surrey Transfer Station Building Upgrades Surrey 1,000,000 ‐ 1,000,000 1,000,000 ‐ 0% Not Started Y 119,500,000 62,626,858 56,873,142 134,900,000 (15,400,000)
Waste to Energy Facility Acid Gas Reduction Burnaby 47,000,000 450,000 46,550,000 47,000,000 ‐ 1% Ongoing N Operational Certificate ammendment pending Biosolids Processing Burnaby 500,000 ‐ 500,000 500,000 ‐ 0% Ongoing Y Bottom Ash Dischargers / Conveyors Burnaby 1,700,000 1,404,465 295,535 1,127,000 573,000 95% Ongoing Y (1) Feed Hopper/Chute Burnaby 2,600,000 ‐ 2,600,000 2,600,000 ‐ 0% Ongoing Y Feedwater Pump Replacement Burnaby 1,000,000 242,556 757,444 284,000 716,000 90% Ongoing Y (1) Furnace Liner Upgrade Burnaby 2,500,000 2,039,883 460,117 2,158,000 342,000 99% Ongoing Y (1) Maintenance Infrastructure Allowance Burnaby 12,850,000 ‐ 12,850,000 12,850,000 ‐ 0% Not Started Y Primary Economizer Replacement Burnaby 5,000,000 ‐ 5,000,000 5,000,000 ‐ 0% Not Started Y Refuse Crane Burnaby 7,000,000 73,539 6,926,461 7,000,000 ‐ 1% Ongoing Y Second Pass Superheater Replacement Burnaby 5,500,000 2,340,816 3,159,184 5,484,000 16,000 66% Ongoing Y (1) Secondary Economizers Replacement Burnaby 6,000,000 ‐ 6,000,000 6,000,000 ‐ 0% Not Started Y 91,650,000 6,551,259 85,098,741 90,003,000 1,647,000
Grand Total Solid Waste Services 231,550,000 41,852,278 189,697,722 245,303,000 (13,753,000)
Notes: (1) Contractor authorized expenditure amount
2019_SW_Capital_Expenditure_Summary_‐_December / Lifetime FD603 Solid Waste Performance andPage 1 of 1 Audit Committee 4/28/2020 ATTACHMENT 2 - WS Metro Vancouver Water Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 490 491 492 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments
Infrastructure Growth Capital Annacis Main No. 5 (Marine Crossing) New West/Surrey 448,000,000 27,394,119 420,605,881 448,000,000 ‐ 6% Ongoing Y Annacis Main No. 5 (North) New Westminster 44,900,000 294,598 44,605,402 44,900,000 ‐ 1% Ongoing N Design delays. Annacis Main No. 5 (South) Surrey 48,100,000 1,690,440 46,409,560 48,100,000 ‐ 4% Ongoing Y Cape Horn Pump Station No. 3 Coquitlam 56,950,000 255,153 56,694,847 56,950,000 ‐ 0% Ongoing Y Coquitlam Intake No. 2 & Tunnel Coquitlam 1,369,230,000 6,650,034 1,362,579,966 1,369,230,000 ‐ 0% Ongoing Y Coquitlam Intake No. 2 (Water Treatment) Coquitlam 957,000,000 ‐ 957,000,000 957,000,000 ‐ 0% Ongoing Y Coquitlam Main No. 4 (Cape Horn) Coquitlam 130,600,000 985,723 129,614,277 130,600,000 ‐ 1% Ongoing N Alignment under review. Coquitlam Main No. 4 (Central Section) Coquitlam 200,470,000 1,839,628 198,630,372 200,470,000 ‐ 1% Ongoing N Alignment under review. Coquitlam Main No. 4 (South Section) Coquitlam 153,650,000 1,826,117 151,823,883 153,650,000 ‐ 1% Ongoing N Alignment under review. Coquitlam Pipeline Road Remediation Coquitlam 2,000,000 95,892 1,904,108 2,000,000 ‐ 5% Ongoing Y Fleetwood Reservoir Surrey 43,367,000 3,126,079 40,240,921 43,367,000 ‐ 8% Ongoing N Project delayed due to property approval. Grandview Reservoir Unit No. 2 Surrey 26,000,000 ‐ 26,000,000 26,000,000 ‐ 0% Not Started Y Haney Main No. 4 (West Section) Port Coquitlam 93,000,000 249,060 92,750,940 93,000,000 ‐ 0% Ongoing Y Hellings Tank No. 2 Delta 29,411,000 4,265,202 25,145,798 29,411,000 ‐ 15% Ongoing Y Jericho Reservoir No. 1 Langley Township 38,065,000 21,416,463 16,648,537 38,065,000 ‐ 56% Ongoing Y (c) Kennedy Newton Main Surrey 141,900,000 4,473,093 137,426,907 141,900,000 ‐ 3% Ongoing N Route selection delays. Newton Pump Station No. 2 Surrey 28,800,000 2,032,928 26,767,072 34,800,000 (6,000,000) 7% Ongoing N (a) Property acquisition delays. Port Mann Main No. 2 (South) Surrey 44,800,000 22,323,647 22,476,353 44,800,000 ‐ 50% Ongoing N Coordinating alignment with City of Surrey.
South Delta Main No. 1 Upgrade Delta 16,150,000 14,751,297 1,398,703 14,751,000 1,399,000 100% Completed Y (b)(g) South Surrey Main No. 2 Surrey 108,400,000 85,958 108,314,042 108,400,000 ‐ 1% Ongoing Y Whalley Kennedy Main No. 2 Surrey 61,800,000 ‐ 61,800,000 61,800,000 ‐ 0% Not Started Y Whalley Main Surrey 33,300,000 10,041,953 23,258,047 33,300,000 ‐ 30% Ongoing Y 4,075,893,000 123,797,385 3,952,095,615 4,080,494,000 (4,601,000)
Infrastructure Maintenance Capital Annacis Main No. 2 ‐ Queensborough Crossover Improvement New Westminster 1,200,000 ‐ 1,200,000 1,200,000 ‐ 0% Not Started N (f) Annacis Main No. 2 (River Crossing Removal) Surrey 10,400,000 ‐ 10,400,000 10,400,000 ‐ 0% Not Started Y Annacis Main No. 3 BHP Potash Facility Pipe Protection Surrey 600,000 ‐ 600,000 600,000 ‐ 0% Not Started Y Annacis Main No. 3 Fraser Grain Terminal Pipe Relocation and Protection Surrey 600,000 ‐ 600,000 600,000 ‐ 0% Not Started Y (f) Boundary Road Main No. 2 & No. 3 Decommissioning Burnaby 1,500,000 ‐ 1,500,000 1,500,000 ‐ 0% Not Started Y Burnaby Mountain Pump Station No. 2 Burnaby 23,000,000 242,082 22,757,918 23,000,000 ‐ 1% Ongoing Y Capilano Main No. 4 Abandoning Dist of North Van 700,000 490,024 209,976 700,000 ‐ 70% Ongoing Y Capilano Main No. 7 Line Valve & Swing Connection Dist of North Van 2,100,000 110,975 1,989,025 2,100,000 ‐ 5% Ongoing Y Capilano Main No.5 (South Shaft to Lost Lagoon) Vancouver 139,000,000 5,237,736 133,762,264 139,000,000 ‐ 4% Ongoing N Delayed due to project approval timelines.
Capilano Raw Water Pump Station Bypass PRV Upgrades Dist of North Van 900,000 ‐ 900,000 900,000 ‐ 0% Not Started Y Capilano Watershed Security Gatehouse Dist of North Van 2,300,000 286,724 2,013,276 2,300,000 ‐ 12% Ongoing Y Central Park Main No. 2 (10th Ave to Westburnco) Burnaby 28,350,000 ‐ 28,350,000 28,350,000 ‐ 0% Not Started N Delayed due to project scope review. Central Park Main No. 2 (Patterson to 10th Ave) Burnaby 68,300,000 3,410,159 64,889,841 68,300,000 ‐ 5% Ongoing Y Central Park PS Seismic Upgrade Burnaby 3,700,000 70,835 3,629,165 71,000 3,629,000 2% Cancelled Y (j) Project not required due to design revisions.
Central Park WPS Starters Replacement Burnaby 5,300,000 732,567 4,567,433 8,000,000 (2,700,000) 14% Ongoing Y (a) CLD & SFD Fasteners Replacement & Coating Repairs Dist of North Van 900,000 5,978 894,022 900,000 ‐ 1% Ongoing Y Cleveland Dam ‐ Lower Outlet HBV Rehabilitation Dist of North Van 4,600,000 170,295 4,429,705 4,600,000 ‐ 4% Ongoing Y Cleveland Dam ‐ Spillway Concrete Repairs Dist of North Van 5,500,000 3,325,611 2,174,389 4,100,000 1,400,000 100% Completed N (b)(i) Project delayed due to operational considerations. Cleveland Dam Drumgate Seal Replacement Dist of North Van 1,250,000 261,056 988,944 1,250,000 ‐ 21% Ongoing Y Cleveland Dam Elevator Decommissioning and Ladder Replacement Dist of North Van 500,000 260,497 239,503 260,000 240,000 100% Completed Y (b)(i) CWTP pH, Alkalinity Upgrades Coquitlam 1,700,000 738,781 961,219 1,700,000 ‐ 43% Ongoing Y Douglas Road Main No. 2 ‐ Kincaid Section Burnaby 12,300,000 9,705,838 2,594,162 12,300,000 ‐ 79% Ongoing N Alignment changes. Douglas Road Main No. 2 (Vancouver Heights Section) Burnaby 28,486,000 5,817,799 22,668,201 28,486,000 ‐ 20% Ongoing N Procurement delays. Douglas Road Main No. 2 Still Creek Burnaby 63,100,000 2,725,077 60,374,923 63,100,000 ‐ 4% Ongoing N Alignment changes. E2 Shaft Phase 3 Dist of North Van 16,500,000 14,867,721 1,632,279 16,500,000 ‐ 90% Ongoing Y First Narrows Tunnel Isolation Chamber Improvements Dist of North Van 7,000,000 93,358 6,906,642 7,000,000 ‐ 1% Ongoing Y Improvements to Capilano Mains No. 4 and 5 Dist of North Van 1,700,000 93,093 1,606,907 1,700,000 ‐ 5% Ongoing Y Kersland Reservoir No. 1 Structural Improvements Vancouver 3,750,000 241,276 3,508,724 3,750,000 ‐ 6% Ongoing Y Little Mountain Reservoir Roof Upgrades Vancouver 1,100,000 85,750 1,014,251 1,100,000 ‐ 8% Ongoing Y Lulu Island ‐ Delta Main ‐ Bridgeport Road Relocation Richmond 7,500,000 ‐ 7,500,000 ‐ 7,500,000 0% Cancelled Y (j) Cancelled due to re‐scoping of the George Massey Crossing project Lulu Island ‐ Delta Main ‐ Scour Protection Phase 2 Richmond 3,550,000 ‐ 3,550,000 3,550,000 ‐ 0% Not Started N (f) Lulu Island ‐ Delta Main No. 2 (Marine Crossing) Richmond 370,000,000 ‐ 370,000,000 370,000,000 ‐ 0% Not Started Y Maple Ridge Main West Lining Repairs Maple Ridge 1,350,000 90,634 1,259,366 3,500,000 (2,150,000) 7% Ongoing N (a) Additional scope of work identified. Maple Ridge Pump Station Decommissioning Maple Ridge 800,000 379,958 420,042 380,000 420,000 100% Completed Y (b)
2019 WD Capital Expenditure Summary ‐ December / Lifetime FD601 Water Page 1 of 3 3/12/2020 37091188 Performance and Audit Committee Metro Vancouver Water Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 490 491 492 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments Port Mann Main No. 1 (Fraser River Crossing Removal) Coq/Surrey 13,500,000 255,000 13,245,000 13,500,000 ‐ 2% Ongoing Y Port Moody Main No. 3 Dewdney Trunk Rd Relocation Coquitlam 2,100,000 ‐ 2,100,000 2,100,000 ‐ 0% Not Started Y Port Moody Main No. 3 Scott Creek Section Coquitlam 4,750,000 32,019 4,717,981 4,750,000 ‐ 1% Ongoing Y Queensborough Main Royal Avenue Relocation New Westminster 7,500,000 ‐ 7,500,000 7,500,000 ‐ 0% Not Started Y (f) Rechlorination Station SHS Storage Tank Replacement Regional 800,000 ‐ 800,000 800,000 ‐ 0% Not Started Y Rechlorination Station Upgrades Regional 12,900,000 29,015 12,870,985 13,900,000 (1,000,000) 0% Ongoing Y (a) Additional scope of work identified. Relocation and Protection for MOTI Expansion Project Broadway Vancouver 8,900,000 44,151 8,855,849 8,900,000 ‐ 1% Ongoing Y (f) Relocation and Protection for Translink Expansion Project Surrey Langley SkyTrain Regional 14,000,000 ‐ 14,000,000 14,000,000 ‐ 0% Not Started Y (f) River Road West Main Hwy 99 Crossing Relocation Delta 1,200,000 ‐ 1,200,000 ‐ 1,200,000 0% Cancelled N (j) Cancelled due to re‐scoping of the George Massey Crossing project Sasamat Reservoir Joint Upgrades UEL 700,000 538,640 161,360 593,000 107,000 100% Completed Y (i) SCFP Clearwell Membrane Replacement Dist of North Van 17,000,000 ‐ 17,000,000 17,000,000 ‐ 0% Not Started Y SCFP Concrete Coatings Dist of North Van 6,500,000 1,493,954 5,006,046 3,400,000 3,100,000 75% Ongoing N (k) Delays due to operational requirements. Project scope changed. SCFP Filter Underdrain Repairs Dist of North Van 29,000,000 12,677,800 16,322,200 29,000,000 ‐ 50% Ongoing Y SCFP OMC Building Expansion Dist of North Van 1,400,000 1,584 1,398,416 1,400,000 ‐ 1% Ongoing Y SCFP Polymer System Upgrade Dist of North Van 2,950,000 121,804 2,828,196 2,950,000 ‐ 4% Ongoing Y Seymour Falls Dam‐Relief Wells Inspection & Rehab Dist of North Van 350,000 240,281 109,719 350,000 ‐ 69% Ongoing Y South Delta Main No. 1 ‐ Ferry Road Check Valve Replacement Delta 600,000 3,386 596,614 600,000 ‐ 1% Ongoing Y South Surrey Supply Main (Serpentine River) Bridge Support Modification Surrey 400,000 22,048 377,952 400,000 ‐ 6% Ongoing Y Sunnyside Reservoir Unit 1 Upgrades Surrey 8,050,000 1,635,439 6,414,561 8,050,000 ‐ 20% Ongoing Y Tilbury Main North Fraser Way Valve Addition Burnaby 1,900,000 151,013 1,748,987 1,900,000 ‐ 8% Ongoing Y Westburnco #1 Water PS Main Transformer and MCC Replacement New Westminster 943,000 930,895 12,105 931,000 12,000 100% Completed Y (b) Westburnco Pump Station No. 2 VFD Replacements New Westminster 2,550,000 33,866 2,516,134 2,550,000 ‐ 1% Ongoing Y Whalley Clayton Main Fraser Highway Relocation Surrey 650,000 695,251 (45,251) 866,000 (216,000) 100% Completed Y (d) 958,179,000 68,349,969 889,829,031 946,637,000 11,542,000
Infrastructure Resilience Capital Barnston/Maple Ridge Pump Station ‐ Back‐up Power Pitt Meadows 9,000,000 65,518 8,934,483 9,000,000 ‐ 1% Ongoing Y Burnaby Mountain Reservoir Seismic Upgrade Burnaby 5,300,000 4,652,831 647,169 4,653,000 647,000 100% Completed Y (b) Burnaby Mountain Tank No. 2 Burnaby 21,350,000 45,415 21,304,585 21,350,000 ‐ 1% Ongoing Y Project scope under review. Cambie Richmond Main No. 3 (Marine Crossing) Richmond/Van 370,250,000 248,291 370,001,709 370,250,000 ‐ 1% Ongoing Y Cape Horn PS 1 & 2 Seismic Upgrade Coquitlam 2,300,000 324,268 1,975,732 324,000 1,976,000 100% Completed Y (b)(h) Cape Horn Pump Station 2 ‐ Back‐Up Power Coquitlam 8,150,000 ‐ 8,150,000 8,150,000 ‐ 0% Not Started Y Capilano Raw Water Pump Station ‐ Back‐up Power Dist of North Van 33,000,000 4,849,933 28,150,067 33,000,000 ‐ 15% Ongoing N Site selection delays. Clayton Langley Main No. 2 Surrey 30,300,000 ‐ 30,300,000 30,300,000 ‐ 0% Not Started Y Cleveland Dam Pump House Seismic Upgrade Dist of North Van 2,800,000 1,126,627 1,673,373 1,127,000 1,673,000 100% Completed Y (b)(i) Project scope was reduced. Coquitlam Intake Tower Seismic Upgrade Coquitlam 16,600,000 845,749 15,754,251 17,100,000 (500,000) 5% Ongoing Y (a) Critical Control Sites ‐ Back‐Up Power Regional 1,800,000 ‐ 1,800,000 1,800,000 ‐ 0% Not Started Y CWTP Ozone Back‐up Power Coquitlam 7,450,000 ‐ 7,450,000 7,450,000 ‐ 0% Not Started Y Emergency Power Strategy for Regional Water Facilities Regional 400,000 ‐ 400,000 400,000 ‐ 0% Not Started N Coordinating with Comprehensive Regional Water System Plan. Grandview Pump Station Improvements Surrey 2,200,000 18,539 2,181,461 2,200,000 ‐ 1% Ongoing Y Haney Main No. 4 (Marine Crossing) P.Coq/P.Meadows 370,250,000 235,112 370,014,888 370,250,000 ‐ 1% Ongoing Y Mackay Creek Debris Flow Mitigation Dist of North Van 9,000,000 8,169,233 830,767 9,700,000 (700,000) 91% Ongoing N (a) Delays due to challenging ground conditions.
Pebble Hill Pump Station Seismic Upgrade Delta 1,650,000 ‐ 1,650,000 1,650,000 ‐ 0% Not Started Y (e) Pebble Hill Reservoir No. 3 Seismic Upgrade Delta 8,900,000 93,257 8,806,743 8,900,000 ‐ 1% Ongoing Y Pebble Hill Reservoir Seismic Upgrade Delta 14,800,000 344,736 14,455,264 14,800,000 ‐ 2% Ongoing N Design delays due to geotechnical conditions.
Reservoir Isolation Valve Automation Regional 6,450,000 838,474 5,611,526 6,450,000 ‐ 13% Ongoing N Delayed due to scope refinement. SCFP UPS Reconfiguration Dist of North Van 1,270,000 942,805 327,195 1,005,000 265,000 74% Ongoing Y (b) Second Narrows Crossing (Tunnel) Burnaby/DNV 468,550,000 117,308,160 351,241,840 468,550,000 ‐ 25% Ongoing N Permitting and property acquisition delays.
Seymour Main No. 2 Joint Improvements Dist of North Van 827,000 467,925 359,075 3,252,000 (2,425,000) 57% Ongoing N (a) Coordinating with Second Narrows Water Supply Tunnel Project. Seymour Main No. 5 III ( North ) Dist of North Van 198,000,000 3,129,869 194,870,131 198,000,000 ‐ 2% Ongoing Y Seymour Reservoir Mid‐Lake Debris Boom Dist of North Van 1,200,000 92,695 1,107,305 2,300,000 (1,100,000) 8% Ongoing N (a) Project scope revised. South Delta Main No. 3 ‐ 12th Ave to Pebble Hill Delta 18,200,000 19,428 18,180,572 18,200,000 ‐ 1% Ongoing N Project scope under review. Sunnyside Reservoir Surrey 17,300,000 3,306,673 13,993,327 17,300,000 ‐ 19% Ongoing Y System Seismic Upgrade Regional 122,800,000 ‐ 122,800,000 122,800,000 ‐ 0% Not Started Y Westburnco Pump Station ‐ Back‐up Power New Westminster 19,000,000 598,698 18,401,302 23,500,000 (4,500,000) 3% Ongoing N (a) Design delay, scope modification. 1,769,097,000 147, 724,236 1,621,372,764 1, 773,761,000 (4,664,000)
Infrastructure Upgrade Capital Burwell Alpine Reservoir Valve Improvements Electoral Area A 650,000 340,089 309,911 650,000 ‐ 52% Ongoing Y Cleveland Dam East Abutment Additional GV Series Pump Wells Dist of North Van 750,000 568,589 181,411 750,000 ‐ 76% Ongoing N Coordinating with Regional Parks.
2019 WD Capital Expenditure Summary ‐ December / Lifetime FD601 Water Performance andPage 2 of 3 Audit Committee 3/12/2020 Metro Vancouver Water Services Capital Expenditures Summary As of December 31, 2019 January ‐ February 490 491 492 Lifetime Total Total Projected Project Project Expenditures Remaining Projected Remaining Percent on Project Project Location Budget to Date Budget Expenditures Budget Complete Status Schedule? Note Comments Coquitlam Communication Improvements Coquitlam 1,801,000 123,300 1,677,700 124,000 1,677,000 7% Cancelled N (j) Project to be cancelled. Other options for communication needs are being considered.
CWTP Ozone Generation Upgrades for Units 2 & 3 Coquitlam 12,000,000 2,490,588 9,509,412 7,300,000 4,700,000 21% Ongoing Y (b) Delay due to operational requirements. Haney Main No. 2 Valve Chamber Upgrade ‐ Abernethy Way and 232nd St Maple Ridge 1,600,000 728,948 871,052 1,600,000 ‐ 46% Ongoing Y Infrastructure Upgrade Allowance ‐ Water Regional 134,900,000 ‐ 134,900,000 134,900,000 ‐ 0% Not Started Y LCOC Metal Shop Expansion and Dry Storage Development Burnaby 3,820,000 81,842 3,738,158 82,000 3,738,000 2% Ongoing Y (j) Project to be cancelled. Other work space options are being considered. Lower Seymour Conservation Reserve Learning Lodge Replacement Dist of North Van 5,000,000 544,843 4,455,157 5,000,000 ‐ 11% Ongoing Y Sapperton Main No. 1 New Line Valve and Chamber New Westminster 3,800,000 748,507 3,051,493 3,800,000 ‐ 20% Ongoing N Tie‐ins delayed to Fall 2020. SCFP Interior Lighting Efficiency Upgrade Dist of North Van 500,000 71,775 428,225 500,000 ‐ 14% Ongoing Y South Delta Main No. 1 ‐ 28 Ave to 34B Ave Delta 18,050,000 17,552,544 497,456 19,650,000 (1,600,000) 97% Ongoing N (a) Construction delays due to unforeseen environmental and geotechnical conditions.
South Delta Mains ‐ 28 Ave Crossover Delta 8,500,000 6,104,687 2,395,313 10,500,000 (2,000,000) 72% Ongoing N (a) Utility conflicts and additional scope of work.
Tilbury Junction Chamber Valves Replacement with Actuators Richmond 4,700,000 4,161,975 538,025 4,700,000 ‐ 89% Ongoing N Delay in land acquisition. Water Meter Upgrades Regional 22,400,000 2,296,174 20,103,826 22,400,000 ‐ 10% Ongoing N Procurement delays. Water Optimization ‐ Flow Meters (Non‐billing) Phase 1 Regional 18,000,000 ‐ 18,000,000 18,000,000 ‐ 0% Not Started Y Water Optimization ‐ Flow Meters (Non‐billing) Phase 2 Regional 18,000,000 ‐ 18,000,000 18,000,000 ‐ 0% Not Started Y Water Optimization ‐ Instrumentation Regional 10,700,000 ‐ 10,700,000 10,700,000 ‐ 0% Not Started Y Water Optimization Automation & Instrumentation Regional 9,540,000 3,093,326 6,446,674 9,540,000 ‐ 32% Ongoing N Procurement delays. 274,711,000 38,907,187 235,803,813 268,196,000 6,515,000
Opportunity Capital Capilano Hydropower Dist of North Van 99,250,000 218,368 99,031,632 99,250,000 ‐ 1% Ongoing Y 99,250,000 218,368 99,031,632 99,250,000 ‐
‐ ‐ ‐ ‐ Grand Total Water Services 7,177,130,000 378,997,146 6,798,132,854 7,168,338,000 8,792,000
Notes: (a) Additional budget included in 2020 Capital Plan. (b) Construction costs lower than estimated. (c) City of Surrey share ‐ 33.72%, Township of Langley share ‐ 66.28%. (d) City of Surrey will reimburse MV costs. (e) Cost sharing proposal with City of Delta (f) Project start is dependent on a 3rd party. External agency yet to begin work. (g) GVWD Share ‐ 25%; TFN share ‐ 75%. (h) A revised design approach substantially reduced construction costs. (i) Contingency not required. (j) Project cancelled. (k) Extent of construction scope less than originally anticipated.
2019 WD Capital Expenditure Summary ‐ December / Lifetime FD601 Water Performance andPage 3 of 3 Audit Committee 3/12/2020 ATTACHMENT 3 - HOU
Metro Vancouver Housing Corporation Capital Project Status Information December 31, 2019
The progress details of the Metro Vancouver Housing Corporation (MVHC) capital projects are highlighted below:
Heather Place – Building A The redevelopment of the Heather Place property was divided into 3 phases, Heather Place A, B and C. The decommission and reconstruction of the first phase of the property was scheduled to begin in 2017 with a majority of work expected to proceed in 2018. Following the initial tendering of the construction contract, bid prices were higher than estimated, leading to a value engineering phases and associated delay to the construction start to spring of 2018. As a result, project expenditures in both 2017 and 2018 were lower than originally anticipated. A substantial percentage of work at Heather Place A was finished in 2019 with the completion of the project expected in the spring of 2020.
Heather Place – Building B Preliminary consulting and design work for the second phase, Heather Place B, was expected in 2019. Currently, MVHC is in discussions with the City of Vancouver regarding changes to the design requested by the Metro Vancouver Housing Committee.
Kingston Gardens The design phase of the Kingston Gardens project is currently underway. Progress and expenditures for this project remained under budget for 2019 due to rezoning on the project site resulting from the City of Surrey’s requirement of a land dedication for a future transportation corridor along both 152nd Street and 99th Avenue.
Welcher Avenue MVHC received authorization to proceed with the redevelopment of the Welcher Avenue properties in early 2019. The approved funds in the 2019 amended budget were utilized on required environmental assessments, design consultants, and architects. A Request for Qualifications (RFQ) and subsequent Request for Proposal (RFP) were issued and awarded for architectural and consulting services in 2019. Architectural work began in late 2019.
Performance and Audit Committee ATTACHMENT 3 - LWS Capital Project Status Information December 31, 2019
GREATER VANCOUVER SEWERAGE & DRAINAGE DISTRICT (Liquid Waste Services)
Major GVS&DD liquid waste capital projects are generally proceeding on schedule and within budget. The following capital program items and exceptions are highlighted:
Infrastructure Growth Program
• FSA – Albert Street Trunk Sewer – The construction contract for Phase 1 of this project involves 700 m of new sewer along Seaforth Drive in Port Moody. It was awarded in June 2019. The project was completed in October 2019. Final paving was delayed until spring 2020. Phase 2 design is underway. Targeting Q4 2020 construction start, however, it is dependent on the completion of property negotiations.
• FSA – Burnaby Lake North Interceptor (also known as the Winston Street Sewer) – Phase 1 of the sewer twinning along Lougheed Highway west of Sperling Street is complete. Phase 2 and 3, with diameters of 1050 mm to 1800 mm, involves 2 km of tunneled sewer and 1.2 km of open cut sewer, and will be located along Winston Street from Sperling to east of Piper Street. The open cut portion of the work was tendered in early December 2019 with award targeted for February 2020. The tunneling portion of the work will be tendered in Q4 of 2020. Construction is scheduled to be complete in 2022. Phase 4, which continues to Cariboo Street, will be completed at a later date.
• FSA – North Road Trunk Sewer – This project will provide additional sewer capacity to the growing area near Lougheed Mall and Burquitlam in the Cities of Burnaby and Coquitlam. The construction contract for Phase 1 of this project involves 800 m of new sewer along North Road from Brunette River to north of the Lougheed highway. The main construction contract was awarded in June 2019. As of the end of December, the contractor is 33% complete and is projected to reach substantial completion in May 2020. Following the completion of the open cut sewer works, a second contract to build a pipe bridge spanning the BNSF Railway will be issued subject to resolving property and permitting requirements. Phase 2, which involves extending the sewer north of Lougheed Highway to Clarke Road is scheduled for construction in 2022.
• FSA – South Surrey Interceptor Twinning Johnston Road Section – This project involves construction of approximately 2.2 km of 3 m diameter corrosion resistant sewer, to provide additional capacity to service Surrey and Langley. Construction of the twinning started in 2015, and is being completed in 5 separate construction contracts. The first two contracts consisted of 1.1 km of open cut sewer from King George Boulevard to Panorama Drive. The third contract involved 820 m of tunnel and was awarded in April 2018 and substantially completed in mid‐December, 2019. Some minor restoration work is to be completed in spring of 2020. The last two contracts, involving 220 m of open cut and a large junction chamber, are scheduled to be tendered in 2020 and 2021 respectively. Total project completion is anticipated to be reached in 2022.
Page 1 of 4 Performance and Audit Committee • FSA – South Surrey Interceptor – King George Section Odour Control Facility (OCF) and Grit Chamber. This project involves three separate installations: two odour control facilities (at King George Boulevard near 56 Ave in Surrey and at Highway 10 and Highway 91 in Delta) and a grit chamber at the King George location. The grit chamber portion of this project is complete and in service. The contractor has procured the equipment and started construction of the Highway 91 OCF. Construction of the King George facility will start upon receipt of all required permits, expected in early 2020. Commissioning of the facilities is scheduled for the summer of 2020.
• FSA – Sapperton Pump Station – FSA – Sapperton Pump Station – The construction contract was awarded in September 2016 and is expected to be substantially complete in 2020. Construction is currently 92% complete, with the pump station building almost finished and landscaping work underway. Final electrical work nearing completion for BC Hydro energization in the summer and pump commissioning activities to follow.
• FSA – Annacis Island WWTP Stage 5 Expansion Phase 1 – This work involves expansion of treatment process units including primary sedimentation tanks, secondary clarifiers, solid contact tanks and odour control facilities. The $253 million construction contract was awarded to Graham and AECON Joint Venture in April 2017. Construction of the Phase 1 main contract is 85% completed and the anticipated substantial completion date is September 2021.
• FSA – Annacis Island WWTP Outfall – This project involves the construction of a new outfall with increased capacity to support population growth. The 4.2 m diameter outfall will be tunneled at a depth of approximately 40 m, and convey treated effluent approximately 1 km from the Plant to the Fraser River where it will discharge from a 2.5 m diameter, 250 m long diffuser manifold buried in the river bed. The construction contract was awarded on May 24, 2019 to Pomerleau‐ Bessac General Partnership in the amount of $184M, and the notice to proceed letter was issued August 1, 2019. The contractor has mobilized to site and has started construction of the two on‐land shafts. Construction is scheduled to be complete by Spring 2024.
• FSA – Northwest Langley Treatment Projects – This work involves expansion of the treatment plant from serving 30,000 people to 230,000 people. It also includes a new river crossing, new pump station, SSO storage tank and outfall. The estimated construction cost is $1.3 billion and is scheduled to be complete by the end of 2026.
Detailed design of the new treatment plant is currently underway and is roughly 30% complete. Multiple equipment preselection tenders will be issued this spring to help inform the design. The pump station and storage tank construction contract has been awarded and construction will start in late February. The river crossing design is approximately 60% complete, with construction tendering projected for late 2020. Phase 1 ground improvements have been completed and award of phase 2 ground improvements are underway. The overall project is currently on schedule.
• VSA – Hastings Trunk Sewer – The Hastings Trunk sewer (also known as the Douglas Trunk Sewer) will provide additional capacity to support rapid development and population growth in the Brentwood Mall and Gilmour areas in Burnaby. The project involves construction of 1.8 km of sewer ranging from 750 mm to 1200 mm in diameter. The construction of a 1km long tunnel section is completed. The remaining is 60% complete. All work is scheduled for completion in May 2020.
Page 2 of 4 Performance and Audit Committee Infrastructure Maintenance Program
• LSA – Gilbert Trunk Sewer Twinning ‐ Construction of the 3.5 km long Phase 1 is complete. The remaining 3 Phases have a total length of 6.5 km consisting of 1.5 m and 1.8 m diameter sewers. Phase 2 construction from Blundell to north of Westminster Highway is 90% complete, with completion projected for early 2020. Phase 4, from Steveston Highway to the Lulu Island WWTP, will be tendered in Q2 of 2020. Phase 3, which extends from Blundell Road south to the Steveston Highway will be completed last, with construction scheduled to start in 2021.
• VSA – Iona Island WWTP Solids Handling Upgrade – This project involves upgrades to the existing grit removal and sludge screening systems, increasing sludge thickening capacity, and improving the digester sludge mixing systems. Construction to refurbish the existing sludge thickener was completed on schedule in April 2016 and is back in full operation. The construction of the new screening, degritting and thickening facility was completed and in operation since August 2017. The Digester Mixing Upgrade contract started in November 2015 and, of the four digesters, Digesters No. 2, No. 3 and No. 4 upgrades are complete and back in service. Work on the last digester, Digester No. 1, started in July 2019 and is scheduled to be complete by February 2021.
• FSA – Annacis Island WWTP Secondary Clarifier Corrosion Repair – This project involves replacing 12 secondary clarifier mechanisms that have been damaged by corrosion and are at the end of their service life. The construction contract for this project includes the Secondary Clarifier Flow Control and Secondary Bypass components which involve the addition of 12 new influent flow balancing gates, and the replacement of 3 existing secondary bypass gates. To date, 7 mechanisms, 3 flow balancing gates and all 3 secondary bypass gates have been replaced. A tender for the remaining 5 mechanism units, and the replacement of the 12 existing effluent launders and weirs, was awarded in March 2019, in the amount of $17M. Fabrication of the new mechanisms is underway. Construction is scheduled to start in May 2020 following completion of the new Stage 5 secondary clarifiers, with construction projected to be complete in 2023.
Infrastructure Resilience Program
• FSA – Annacis Island WWTP Cogeneration System – This $75 million resiliency project involves the installation of four new larger capacity cogeneration engines (2000 kW each) complemented by two new emergency stand‐by diesel generators (3000 kW each) in order to: 1) provide rapid response (< 60 seconds) emergency back‐up power in case of BC Hydro utility outages, 2) optimize the use of digester gas produced at the plant, 3) increase the cogeneration capacity, 4) minimize the amount and cost of electricity imported from BC Hydro costs, and 5) minimize digester gas flaring. The project started in Q4 2017 and construction is substantially complete as of August 2019. The new cogeneration engines and diesel gensets are presently being integrated into the Plant via engineered tie‐ins. Planning is underway for operational commissioning in March 2020.
• VSA – Highbury Interceptor Air Treatment Facilities – Construction of this odour control station located in Musqueam Park in Vancouver started in February 2018. The facility construction is 95% complete and scheduled to be in service in May 2020. The air jumper component, which is a separate facility to allow the free movement of air in the sewer and extend odour control south to the Fraser River, was completed in September 2019.
Page 3 of 4 Performance and Audit Committee • VSA – Emergency Backup Power ‐ This project involves design, supply and installation of standby emergency backup generators at Chilco, Columbia, Harbour, Hudson, Jervis, Kent and Willingdon pump stations to allow the stations to remain operational during power failure events and reduce the risk of a spill. The tenders for the Columbia, Harbour, Hudson, Kent and Willingdon upgrades were issued in Q4 2019. The equipment has been procured, and construction for Hudson, Willingdon and Kent has started. Harbour and Columbia are scheduled for Q2 2020 construction start. These 5 sites are all scheduled to be commissioned in 2020. The design of the Jervis and Chilco facilities and Vancouver Parks Board approval process is in progress.
Infrastructure Upgrade Program
• FSA – Sperling Pump Station ‐ The Sperling Pump Station Upgrading Project involves the upgrade and expansion of the existing aging and under capacity facility. Construction is complete and the facility commissioned in August of 2019 with only minor deficiencies outstanding.
• VSA – Iona Island WWTP Biosolids Dewatering Facility – This project involves the design build construction of a mechanical dewatering facility to dewater on‐going plant production of biosolids so that they can be transported for beneficial reuse or disposal. This facility will permit the decommissioning of the four existing digested sludge lagoons and the sludge drying area to make space for the construction of the new treatment plant. The $55 million design‐build contract was awarded to NAC Constructors in April 2019. The design phase is 90% complete. Ground improvement comprising of 400 stone columns is complete, preload has been installed and anticipated for removal in Feb 2020. The project is scheduled to be complete in April 2021.
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Page 4 of 4 Performance and Audit Committee ATTACHMENT 3 - PARKS
Regional Parks Services Capital Project Status Information December 31, 2019
Major Regional Parks capital projects are proceeding on schedule and within budget. Project details are highlighted below:
Sheep Paddocks Trail Construction on Sheep Paddocks Trail was initiated in 2017 and conducted in three phases. Phase 1 included vegetation clearing and preloading for the part of the trail. Phase 2 completed in 2018 included preloading for the rest of the trail, invasive species management and temporary culvert installation. Phase 3 included trail construction, the instream works to stabilize the river bank, construction of the 1.2 hectare open pond/wetland complex developed to provide habitat for Western Painted turtles, fencing and site furnishings. The project was substantially complete at the end of 2019 and the trail is open to the public. Additional planting and an official opening will take place in spring of 2020.
Aldergrove Management Plan Implementation Implementation of the Aldergrove Management Plan is phased over multiple years. In 2018 construction of the Aldergrove Nature Discovery Area was initiated. This initial phase included trail construction, fencing, planting and the natural play features. This section was opened to the public in early 2019.
In 2019 construction of the Nature Discovery Trail and Wetland was initiated. This project provides a new trail, wetland and areas for nature discovery and interpretation that will connect people to nature. The development of the site has restored a wetland in a portion of the park that was not previously accessible to the public. An accessible walking loop now connects into the existing park trail network. A key feature of the new area is a constructed wetland, which provides valuable habitat and educational benefits. The wetland will enhance biodiversity by creating habitat for species at risk including red-legged frogs and Western toads. The wetland also features pond dipping and viewing areas for educational programs and park visitors.
The site was entirely planted through the Regional Parks’ Stewardship Program volunteers and grants for plants. It will be open in early 2020.
Phase 3 the Rock ‘N’ Horse trail is currently scheduled to be complete in 2021.
Service Yard Buildings The 2019 Regional Parks Capital Plan included three service yard buildings projects. The service yard building at Crippen Regional Park was delayed due to unanticipated additional soil investigations that led to permitting delays. This project was re-budgeted for 2020. The construction of the Colony Farm service yard building was initiated in 2019 and will be completed in 2020. In late 2018 it was identified
Performance and Audit Committee that a new site would be required for the Capilano River Regional Park service yard. Site selection and consultant procurement took place in 2019. Detailed design is underway and construction for a service yard to support both Capilano River and Grouse Mountain Regional Parks will start in the second half of 2020 and be phased over the next two years.
Performance and Audit Committee ATTACHMENT 3 - SWS
Capital Project Status Information – Solid Waste Services December 31, 2019
Major GVS&DD solid waste capital projects are proceeding on schedule and within budget. Project details are highlighted below:
Transfer Station Program • The Coquitlam Transfer Station replacement project construction started in May 2018 with site grading works. The full construction contract was awarded in December 2018. Construction is currently underway with anticipated commissioning of the new transfer station scheduled for early 2021. • The Surrey Recycling and Waste Drop‐Off Facility project received rezoning and a development permit in late 2018. The project was issued for construction RFP in October 2019 and closed in December 2019. General contractor submissions are currently being evaluated. A building permit was granted by the City of Surrey in November 2019. Construction is anticipated to start in April of 2020.
Landfills Program • Construction of Phase 2 landfill gas collection system upgrades for the new Coquitlam Transfer Station are in progress. The system has been designed as a combination of an active system at buildings and a passive system over the remainder of the transfer station site. Installation of the active gas wells was completed in 2019. Installation of the passive system along with laterals and header pipes for the active system is anticipated to be completed in late 2020. A new control room at the blower flare station is required for the existing and future system upgrade. Design of the new control room is complete and construction is anticipated in Q3 2020.
Waste‐to‐Energy Program • The refuse crane replacement project commenced with preliminary engineering on February 14, 2019. The preliminary engineering report identified funding gaps which will be addressed through the 2021 budget cycle. • The second pass superheater replacement project started on April 11, 2019. The replacement tubing has been received and installed on two boilers during the 2019 fall outages. Installation will occur on the final boiler during the spring outage in April 2020. • The feedwater pump replacement project commenced on May 3, 2019. The pump was installed in November 2019 and commissioned in January 2020. Covanta is working with the pump manufacturer to bring the pump capacity up to full specifications. • The feed hopper / chute replacement project started on October 28, 2019. Quotations have been requested from vendors with the plan to install two units in fall 2020 and one unit in Spring 2021. • The biosolids processing preliminary design project started on October 28, 2019. Preliminary design work will continue through 2020.
Performance and Audit Committee ATTACHMENT 3 - WS
Capital Project Status Information December 31, 2019
GREATER VANCOUVER WATER DISTRICT (Water Services)
Major GVWD capital projects are generally proceeding on schedule and within budget. The following capital program items and exceptions are highlighted:
Infrastructure Growth Program • Annacis Water Supply Tunnel – A 2.3 km long, 4.5 m diameter water supply tunnel is required under the Fraser River to meet growing water demand south of the Fraser and to provide increased system resiliency. Detailed design, which was awarded to Hatch Corporation, is now substantially complete. Property acquisition along the tunnel alignment continues. Environmental site remediation at the north shaft site in New Westminster is complete and the construction RFQ is expected to be issued in spring 2020.
• Annacis Main No. 5 (South) – This project comprises approximately 3.0 km of 1.8 m diameter steel pipe connecting the south shaft of the Annacis Water Supply Tunnel to the Kennedy Reservoir in the City of Surrey. Preliminary design has been completed and detailed design is in progress and expected to be complete in July 2020.
• Cape Horn Pump Station No. 3 – Cape Horn Pump Station No. 3 with a back‐up power system, will supplement the existing pump station to deliver Coquitlam source water to meet growing demand in the municipalities south of the Fraser River. Preliminary design of the new station started Q1 2020 and is expected to be complete Q2 2021.
• Coquitlam Intake No. 2 – A new intake, tunnel and treatment plant are proposed at the Coquitlam Reservoir to increase the supply and transmission capacity from this source. The Draft Project Definition Report was received in December 2019. A Value Engineering workshop will be held in Q2 2020 to review options to reduce risks, confirm costs and improve the schedule. A Final Project Definition Report, which will incorporate suitable options identified in the Value Engineering, will be completed in Q3 2020.
• Coquitlam Main No. 4 – This 13 km long steel water main, consisting of the Central, South and Cape Horn Sections, will increase the transmission capacity from the Coquitlam Water Treatment Plant to the Cape Horn Pump Station and Reservoir in the City of Coquitlam. This project is required to address capacity constraints in the existing Coquitlam transmission system and also provide capacity for future growth. The preferred alignment was endorsed by the City of Coquitlam Council in February 2020. Detailed design of the Central and South Sections will commence in March 2020.
• Fleetwood Reservoir – Phase 1 of the Fleetwood Reservoir project includes a 13.6 ML reservoir, valve chamber, piping, access building and associated work located at Meagan Ann MacDougall Park in the City of Surrey. Detailed design is complete. The City of Surrey is finalizing the Property Lease Agreement and construction is expected to commence in Q3 2020.
37716908 Page 1 of 4
Performance and Audit Committee • Jericho Reservoir – Phase 1 of the Jericho Reservoir project includes a 20.6 ML reservoir, chambers, piping and associated work located at 20400 73A Avenue in the Township of Langley. Construction commenced in December 2018 and is projected to be completed in July 2020.
• Kennedy Newton Main – This project comprises approximately 9.0 km of 1.8 m diameter steel water main between the Kennedy Reservoir and the Newton Reservoir in the City of Surrey. The project is divided into 3 phases and construction of Phase 1, between 72nd Avenue and 84th Avenue, commenced in October 2019 and Phase 2, between 72nd Avenue and Newton reservoir is expected to commence late summer of 2020. Design of the remaining phase 3, from 84th Avenue to Kennedy reservoir, is in progress.
• Newton Pump Station No. 2 – This project, located at 6287 128th Street in the City of Surrey, comprises replacing the existing Newton Pump Station and includes full back‐up power redundancy, connections to existing and future infrastructure, and installation of new outlets to the existing Newton Reservoir. The preliminary design phase was completed in December 2019 and detailed design is in progress with completion scheduled for December 2020.
• Port Mann Main No. 2 (South) – This 2.8 km long, 1.5 m diameter steel water main will twin the existing Port Mann Main No. 1 between the south shaft of the Port Mann Water Supply Tunnel and the Whalley Main in the City of Surrey. The project is required to meet growing water demand south of the Fraser River. Construction is expected to be completed in July 2020, except for the portion of mains at the Hjorth Road Elementary School which is delayed due to property negotiations.
• Whalley Main – This 2.0 km long, 1.5 m diameter steel main will twin the existing Whalley Clayton Main between the Whalley Reservoir and the Whalley Kennedy Link Main in the City of Surrey. The construction commenced in June 2019 and is 20% complete. Project completion is anticipated for summer 2021.
Infrastructure Maintenance Program • Douglas Road Main No. 2 – Still Creek Section ‐ This project comprises approximately 2.5 km of 1.5 m diameter steel pipe with trenchless crossings of Highway 1, Still Creek and the BNSF rail line. The water main alignment has been finalized in consultation with the City of Burnaby. The detailed design phase is in progress and the required rights of ways are in the process of being secured. The Project is planned to be constructed in three phases, with the 560m North Section commencing in Fall 2020. Design of the remaining two phases is underway.
• Douglas Road Main No. 2 – Vancouver Heights Section ‐ This project comprises approximately 2.0 km of 1.5 m diameter steel pipe connecting the Vancouver Heights Reservoir to the Douglas Road Main No. 2 at Beta Avenue and Albert Street in the City of Burnaby. Construction is well underway and completion is expected in August 2020.
• Central Park Main No. 2 – Patterson to 10th Ave ‐ This project comprises approximately 7.0 km of 1.2 m diameter steel pipe connecting the Central Park Pump Station in Burnaby to the existing Central Park Main in New Westminster at 10th Avenue. The water main is planned to be constructed in three phases with the 500‐meter‐long Maywood Pre‐build completion expected late spring 2020. Design of the remaining two phases is underway.
37716908 Page 2 of 4 Performance and Audit Committee • E2 Shaft Replacement – The E2 Shaft, which has controlled ground water in the East Abutment of Cleveland Dam since the 1950’s is nearing the end of its service life and needs to be replaced by a system of horizontal drains. A total of 6 horizontal drains have now been completed, and are being monitored to determine if additional work is required.
• Capilano Main No. 5 (Stanley Park Section) – This 1.4 km long steel water main, in a tunnel, will replace the existing Capilano Main No. 4 through Stanley Park to meet growing water demand and provide increased system resiliency. Preliminary design has been completed. Detailed design has commenced and is anticipated to be complete in Q1 2021.
• SCFP Filter Underdrain Repair – This project consists of phased replacement of the existing underdrains in the 24 filters. New underdrains have been installed in twelve filters and the filters returned to service. The project is scheduled for completion in Q4 2020.
• Cleveland Dam – Spillway Concrete Repairs Construction – As part of the ongoing maintenance program for the Cleveland Dam, the spillway training walls and a section of the spillway were repaired. Work included crack repair and the application of a cementitious coating on the training walls and minor resurfacing on the spillway. The work was coordinated with lake levels in the Capilano Reservoir and completed in October 2019.
• Sunnyside Reservoir Unit No. 1 – Seismic Upgrade and Upgrades (Non‐Seismic) – The key components of the seismic upgrade work are external shear walls, replacement of existing roof slab and thickening of perimeter walls and footings. Other upgrades include drainage improvements, a new inlet pipe, underground valve chamber, access road and dechlorination system. Construction commenced early October 2019 with completion scheduled for Q4 2020.
Infrastructure Resilience Program • Clayton Reservoir – This project comprises a new 22.5 ML reservoir located at 72nd Avenue and 190th Street in Surrey that will increase storage capacity, meet current seismic standards and replace the existing Clayton Tank. The new reservoir is now in service with minor site restoration and architectural finishing still underway.
• Mackay Creek Debris Flow Mitigation – Detailed design and construction engineering services for this project were awarded to BGC Engineering Inc. Detailed design was completed in early 2019. The construction contract was awarded to BEL Contracting. Construction commenced in spring 2019 and is scheduled to be complete by Spring 2020.
• Second Narrows Water Supply Tunnel – This project comprises a 1.1 km long, 6.5 m diameter water supply tunnel under Burrard Inlet, between North Vancouver and Burnaby, to increase the reliability of supply in the event of a major seismic event and provide additional long term supply capacity. The contract for construction was awarded to the Traylor‐Aecon General Partnership in October, 2018. Mobilization and site preparation commenced in early 2019. Construction of the north shaft commenced in May 2019 and is complete. Construction of the south shaft is now underway. The Tunnel Boring Machine was delivered to site in February 2020, with tunneling expected to commence in Q2 2020.
37716908 Page 3 of 4 Performance and Audit Committee • Capilano Raw Water Pump Station – Back‐up Power – This project consists of installing diesel generators to provide 8 MW back‐up power to the pump station. Shop drawing submittals for the pre‐purchased electrical equipment are ongoing, with the equipment anticipated to arrive in 2020. Construction is anticipated to start Q4 2020 with overall project completion in 2022.
• Coquitlam Intake Tower Seismic Upgrade – The Coquitlam Intake Tower is located in the southeast corner of the Coquitlam Lake. Constructed in 1913, the tower provides the GVWD its primary intake of water from Coquitlam Lake. The Tower is a 27‐meter‐high and 5.5 meter diameter unreinforced concrete structure, founded on bedrock. Detailed design of a seismic upgrade is 50% complete. Due to coordination with BC Hydro work, construction will be completed in 2 stages (winter of 2022 and fall 2023/spring 2024).
• Pebble Hill Reservoir Seismic Upgrade – Pebble Hill Reservoir in south Delta is comprised of three units. Detailed design for the seismic upgrade of the three units is in progress. Construction is scheduled in stages, taking only one unit out of service at any time. Construction will commence in 2020 and is expected to be completed in 2024.
• Westburnco Pump Station – Back‐up Power – This project consists of installing diesel generators to provide 5 MW back‐up power to the pump station. Preliminary design was completed in 2019 and detailed design continues in 2020.
Infrastructure Upgrade Program • South Delta Main No. 1 Replacement – 28th Avenue to 34B Avenue – This project consists of replacement of the existing South Delta Main No. 1 on 53rd Street from 28th Avenue to 34B Avenue, and on 28th Avenue between 52nd Street and 53rd Street. Phase 3 consists of approximately 1.6 km of 900 mm diameter welded steel pipe and a crossing of the BC Rail tracks at Deltaport Way. Phase 3 construction commenced in fall 2018 and is scheduled for completion in May 2020. The work is being coordinated with the City of Delta’s road reconstruction and storm drain installation work.
• Coquitlam Ozone Upgrade – This project consists of upgrades to the ozone generators at the Coquitlam Water Treatment Plant. The generators for unit Nos. 1 and 2 have been replaced. Unit No. 1 is in service and Unit No. 2 is being commissioned. Unit No. 3 will be completed in 2020.
37716908 Page 4 of 4 Performance and Audit Committee Metro Vancouver ATTACHMENT 4 2019 Capital Spending Summary For the 12 months ending December 31, 2019 2/28/2020 2019 2019 Budget Amended Actual % of Budget Amendments 2019 Budget Expenditures Annual Budget Housing Services Capital Replacement 10,001,242 10,001,242 9,385,746 Development Capital 21,317,000 775,000 22,092,000 14,831,271 31,318,242 775,000 32,093,242 24,217,017 75%
Liquid Waste Services Infrastructure Growth Capital 227,850,000 227,850,000 210,064,211 92% Infrastructure Maintenance Capital 83,650,000 83,650,000 50,308,293 60% Infrastructure Resilience Capital 33,100,000 33,100,000 18,592,707 56% Infrastructure Upgrade ‐ Advanced Treatment Capital 182,100,000 182,100,000 118,872,946 65% Infrastructure Upgrade Capital 28,550,000 28,550,000 15,953,141 56% Opportunity Capital 9,600,000 9,600,000 3,820,523 40% 564,850,000 ‐ 564,850,000 417,611,821 74%
Regional Parks Capital Development 5,110,000 5,110,000 4,024,756 79% Capital Maintenance Projects 3,175,000 3,175,000 3,583,541 113% Parkland Acquisition Fund Projects 7,570,000 3,555,000 11,125,000 11,236,927 101% 15,855,000 3,555,000 19,410,000 18,845,224 97%
Solid Waste Services Infrastructure Opportunity Program 210,000 210,000 ‐ 0% Landfills 9,400,000 9,400,000 4,029,855 43% Transfer Station System 65,000,000 65,000,000 24,151,218 37% Waste to Energy Facility 14,600,000 14,600,000 3,386,013 23% 89,210,000 ‐ 89,210,000 31,567,085 35%
Water Services Infrastructure Growth Capital 62,850,000 62,850,000 61,992,463 99% Infrastructure Maintenance Capital 52,450,000 52,450,000 36,954,762 70% Infrastructure Resilience Capital 90,800,000 90,800,000 112,317,039 124% Infrastructure Upgrade Capital 24,600,000 24,600,000 32,227,018 131% Opportunity Capital 700,000 700,000 ‐ 0% 231,400,000 ‐ 231,400,000 243,491,282 105%
Total 932,658,242 4,330,000 936,988,242 735,732,428 78.5%
Performance and Audit Committee 5.7
To: Performance and Audit Committee
From: Dean Rear, General Manager, Financial Services/Chief Financial Officer
Date: April 19, 2020 Meeting Date: May 6, 2020
Subject: Investment Position and Returns – September 1, 2019 to March 31, 2020
RECOMMENDATION That the Performance and Audit Committee receive for information the report dated April 19, 2020 titled “Investment Position and Returns – September 1, 2019 to March 31, 2020”.
EXECUTIVE SUMMARY The annualized return for Metro Vancouver’s investment portfolio for 2019 was 2.78% or (2.57% including cash) for Short-Term, 2.42% for Long-Term and 2.70% for the Cultural Reserve Fund. Total investment income for 2019 was $21.5 million on an average portfolio balance of $849.5 million. Investment performance has met expectations for the current period. Due to the delay in the committee meeting, results and balance information have been included through March 31, 2020.
Going forward, the overall rate of return is expected to decline notably in the next several months due to the current low yield environment as a result of the COVID 19 pandemic, and a significant portion of the portfolio being placed in short-term products and held in cash for liquidity.
PURPOSE To report investment performance and related economic information for receipt by the Committee.
BACKGROUND Investment updates are brought to the Committee to keep members informed on important updates relating to Metro Vancouver’s investments. The Corporate Investment Policy requires that an investment update report be presented to the Committee three times per year. Given the timing of the report, the period covers the third and final report for 2019 and the current year to the end of March 2020.
INVESTMENT CATEGORIES Short term investments have terms of less than one year at the time of investment. These normally include Bankers’ Acceptances, Canadian Bank Bonds and Credit Union Term Deposits.
Long term investments have terms greater than one year at the time of investment. These investments normally include Canada, Provincial, and Canadian Bank bonds as well as Credit Union Term Deposits greater than one year.
Cultural Reserve investments are long term investments whose revenues have been set aside to fund Metro Vancouver’s annual contributions to cultural activities.
34216798 Performance and Audit Committee Investment Position and Returns – September 1 to December 31, 2019 Performance and Audit Committee Regular Committee Meeting Date: May 6, 2020 Page 2 of 6
OVERALL INVESTMENT RETURNS Table 1
Short Term Investment Performance As at March 31, 2020, the short term portfolio held a total of $146.0 million (at historic cost/book value) and represented 22.9% of total investments. A listing of all short term investments can be found on Schedule 1.
Table 2 details performance during the period compared to benchmarks.
Table 2
The short term portfolio’s performance exceeded all benchmarks for the period.
Performance and Audit Committee Investment Position and Returns – September 1 to December 31, 2019 Performance and Audit Committee Regular Committee Meeting Date: May 6, 2020 Page 3 of 6
The annualized yield of 2.78% (2.57% when cash is included) for 2019 as shown in Table 2 remains consistent with the estimated annualized rate at the end of August. The estimated annualized return of 2.62% (2.39% when cash is included) for the current year is expected to further decrease at a steep rate over the next several months, following a 150 bps rate cut by the Bank of Canada in March in response to the COVID 19 pandemic and the ongoing challenges in the economy.
Long Term Investment Performance As at March 31, 2020, the long term portfolio held a total of $488.9 million (at historical cost/book value) representing 76.7% of all investments. A listing of all long term investments is located on Schedule 2 of this report.
Table 3 details performance during the period compared to our benchmarks.
Table 3
The 2019 annualized yield of 2.42% as shown in Table 3 is slightly higher than the previous period’s reported yield of 2.40%. The 2020 results have not been annualized given only 3 months’ data and high volatility in the market which may skew the annualized rate. The MFA’s Bond Fund outperformed Metro Vancouver’s long term portfolio in 2019 and the first two months of this year due to the significant volatility in the market as a result of the COVID 19 pandemic. Metro Vancouver’s long term
Performance and Audit Committee Investment Position and Returns – September 1 to December 31, 2019 Performance and Audit Committee Regular Committee Meeting Date: May 6, 2020 Page 4 of 6
returns remain steady and continues to outperform the MFAs when looking at the average return over the past 3 years.
The Cultural Reserve portfolio held $2.2 million (at historical cost/book value) in fixed income investments (approx. 0.4% of total investments), and had an annualized yield of 2.70% in 2019, consistent with the prior period. A detailed listing of investments held in this portfolio is located on Schedule 3.
Investment Holdings and Limits Investments by counterparty as percentage of the total portfolio and the maximum limits per the policy have been included in schedule 5. Virtually all BC Credit Union holdings, which account for 25.4% of the total portfolio, are short term and will mature within 1 year. A significant portion of the upcoming maturities for the credit unions will be required to service the cash demands of the capital program, thus may not be reinvested in new terms. Overall, the portfolio remains well diversified and positioned comfortably within the limits.
Looking at the “days to maturity” for all investments, 54.2% will mature in the next 12 months and 26.2% will mature beyond 12 months. The remaining 19.6% are held in HISA and is fully liquid. The expected maturity by sector can be found in Schedule 4 of this report.
Investment Income As illustrated in table 4 below, the overall income on the combined portfolio for short term and long term investments for 2019 has increased steadily from the prior years, in line with the market where the rates trended higher in late 2018 through early 2019.
Table 4
ONGOING MATTERS – COVID-19 Current Economic Impacts The COVID 19 pandemic has led to an unprecedented downturn in the economy, resulting in a loss of more than 1 million jobs to date and causing major disruption to the equity and bond markets. The Canadian government and the Bank of Canada have introduced significant economic measures to help individuals and businesses, and to ease strains in the financial markets.
In response to the pandemic, the US Feds cut its benchmark rates by 150 bps to a range of 0 – 0.25%. The Bank of Canada followed suit and also cut its target interest rate by 150 bps to 0.25%. As part of its stimulus measures, the Bank initiated a suite of credit facilities and purchase programs for bonds and other securities to inject liquidity into the market.
Performance and Audit Committee Investment Position and Returns – September 1 to December 31, 2019 Performance and Audit Committee Regular Committee Meeting Date: May 6, 2020 Page 5 of 6
As illustrated in Table 5 below, the curve took a sharp downturn in 2020. While the yield curve is no longer inverted with the long-end steepening, the overall yields across the curve have decreased significantly. A 10 year Canada benchmark bond currently trades around 0.61% compared to 1.61% back in December 2019.
Table 5
Metro Vancouver’s investment approach is to ensure the portfolio remains liquid and holds only the highest quality products to ensure safety of capital. Overall rate of return is expected to decline notably in the next several months as a significant portion of portfolio will be placed in short-term products or held in cash. A cautious and prudent approach is necessary at this time of great uncertainty.
ONGOING MATTERS - OTHER Proposal to expand municipality’s investment opportunities In response to UBCM’s request to amend the Community Charter to provide municipalities and regional district the ability to allow “a wider scope of local government investments”, the Ministry of Municipal Affairs and Housing stated that they are not currently prepared to expand the allowable investment provisions. Metro Vancouver maintains an ongoing dialogue with the MFA and the other investment partners to identify areas of opportunity.
Westminster Savings Credit Union and Prospera Credit Union Merger Effective January 1, 2020, the two credit unions officially merged and are operating under one legal entity, Prospera Credit Union. As a result of the merger, they are now the sixth largest credit union in Canada, hold approximately $9 billion in assets, and serve approximately 120,000 members. Staff will continue monitor any changes to their credit risk profile following the merger. There is no impact to Metro Vancouver’s current holdings.
ALTERNATIVES This is an information report. No alternatives are presented.
Performance and Audit Committee Investment Position and Returns – September 1 to December 31, 2019 Performance and Audit Committee Regular Committee Meeting Date: May 6, 2020 Page 6 of 6
FINANCIAL IMPLICATIONS Overall portfolio returns remain modest, a reflection of the priorities of preservation of capital and maintaining the necessary liquidity to meet operational requirements.
CONCLUSION Overall, investment performance for the period, while modest, met expectations. Short term investments exceeded returns on our benchmarks. Long term investments had mixed success with reaching returns greater than the benchmarks over the past 12 months, but are still higher when compared over the past 3 years. Metro Vancouver’s portfolios hold quality investments and are reasonably positioned to withstand the current market volatility. Overall rate of return is expected to decline notably in the next several months as a significant portion of portfolio will be placed in short- term products and held in cash.
Attachments: Schedule 1 – Short Term Investments Schedule 2 – Long Term Investments Schedule 3 – Cultural Reserve Investment Schedule 4 – Investment Maturity Charts Schedule 5 – Investment Holdings and Maximum Limit
36418829
Performance and Audit Committee SCHEDULE 1
METRO VANCOUVER SHORT TERM INVESTMENTS AS AT MARCH 31, 2020 DAYS TO MATURITY DATE MATURITY MAT U CONTRACT NUMBER AND SECURITY DESCRIPTION AMOUNT COST PURCHASED DATE RITY YIELD COUPON
BLUESHORE FINANCIAL CREDIT UNION 190025 BLUESHORE 2.75% APR3/20 8,000,000 8,000,000 Apr ,04 2019 Apr ,03 2020 3 2.75 0.00 190030 BLUESHORE 2.70% APR14/20 5,500,000 5,500,000 Apr ,15 2019 Apr ,14 2020 14 2.70 0.00 190031 BLUESHORE 2.65% APR18/20 5,000,000 5,000,000 Apr ,18 2019 Apr ,17 2020 17 2.65 0.00 190035 BLUESHORE 2.55% MAY22/20 5,000,000 5,000,000 May ,23 2019 May ,22 2020 52 2.55 0.00 190039 BLUESHORE 2.65% JUNE5/20 5,000,000 5,000,000 Jun ,06 2019 Jun ,05 2020 66 2.65 0.00 190040 BLUESHORE 2.62% JUNE12/20 5,000,000 5,000,000 Jun ,13 2019 Jun ,12 2020 73 2.62 0.00 190042 BLUESHORE 2.62% JUNE19/20 5,000,000 5,000,000 Jun ,20 2019 Jun ,19 2020 80 2.62 0.00 190043 BLUESHORE 2.62% JUNE19/20 5,000,000 5,000,000 Jun ,20 2019 Jun ,19 2020 80 2.62 0.00 43,500,000 43,500,000 29.79%
CANADIAN WESTERN BANK 190047 CWB 2.52% JUNE26/20 5,000,000 5,000,000 Jun ,27 2019 Jun ,26 2020 87 2.52 0.00 190071 CWB 2.63% AUG21/20 2,500,000 2,500,000 Aug ,22 2019 Aug ,21 2020 143 2.63 0.00 7,500,000 7,500,000 5.14%
G&F FINANCIAL 190074 G&F CU 2.55% SEPT8/20 5,000,000 5,000,000 Sep ,09 2019 Sep ,08 2020 161 2.55 0.00 190082 G&F CU 2.55% NOV12/20 5,000,000 5,000,000 Nov ,18 2019 Nov ,12 2020 226 2.55 0.00 10,000,000 10,000,000 6.85%
NATIONAL BANK 200004 NBC GIC 1.55% APR15/20 25,000,000 25,000,000 Mar ,16 2020 Apr ,15 2020 15 1.55 0.00 200005 NBC GIC 1.42% MAY15/20 25,000,000 25,000,000 Mar ,16 2020 May ,15 2020 45 1.42 0.00 50,000,000 50,000,000 34.25%
VANCITY SAVINGS CREDIT UNION 190045 VANCITY 2.60% JUNE26/20 10,000,000 10,000,000 Jun ,27 2019 Jun ,26 2020 87 2.60 0.00 190053 VANCITY 2.60% JUL3/21 2,500,000 2,500,000 Jul ,04 2019 Jul ,03 2020 94 2.60 0.00 12,500,000 12,500,000 8.56%
WESTMINSTER SAVINGS CREDIT UNION 190028 WSCU 2.80% APR7/20 12,500,000 12,500,000 Apr ,08 2019 Apr ,07 2020 7 2.80 0.00 190033 WSCU 2.65% APR24/20 5,000,000 5,000,000 Apr ,25 2019 Apr ,24 2020 24 2.65 0.00 190034 WSCU 2.65% MAY6/20 5,000,000 5,000,000 May ,07 2019 May ,06 2020 36 2.65 0.00 22,500,000 22,500,000 15.41%
TOTALS $ 146,000,000 $ 146,000,000 100%
Weighted Average Term: 53 Days
Performance and Audit Committee
SCHEDULE 2
METRO VANCOUVER LONG TERM INVESTMENTS AS AT MARCH 31, 2020
CONTRACT NUMBER AND SECURITY MATURITY DAYS TO DESCRIPTION AMOUNT COST DATE PURCHASED MATURITY DATE MATURITY YIELD COUPON
BANK OF MONTREAL 140071 BMO 2.84% JUNE 4/20-1388 5,000,000 5,079,750 Jun ,19 2014 Jun ,04 2020 65 2.55 2.84 170051 BMO 2.1% OCT6/20-1844 5,000,000 5,016,000 Aug ,04 2017 Oct ,06 2020 189 2.00 2.10 170059 BMO 2.1% OCT6/20-1852 5,000,000 5,022,300 Aug ,11 2017 Oct ,06 2020 189 1.95 2.10 170073 BMO 2.10% OCT6/20-1866 2,500,000 2,492,500 Sep ,11 2017 Oct ,06 2020 189 2.20 2.10 180055 BMO 2.1% OCT6/20-1977 5,000,000 4,940,200 Aug ,03 2018 Oct ,06 2020 189 2.67 2.10 190080 BMO GIC 2.42% OCT30/20 5,000,000 5,000,000 Oct ,30 2019 Oct ,30 2020 213 2.42 0.00 190083 BMO GIC 2.43% NOV5/20 2,500,000 2,500,000 Nov ,05 2019 Nov ,05 2020 219 2.43 0.00 140118 BMO 3.40% APR23/21-1445 3,000,000 3,151,500 Aug ,15 2014 Apr ,23 2021 388 2.57 3.40 170035 BMO 2.27% JUL11/22-1825 1,000,000 999,950 Jul ,10 2017 Jul ,11 2022 832 2.27 2.27 160100 BMO STEP-UP NOTE AUG26/26-1766 2,000,000 2,000,000 Aug ,26 2016 Aug ,26 2026 2339 2.32 1.85 180013 BMO 3.19% MAR1/28-1922 2,000,000 1,998,640 Mar ,01 2018 Mar ,01 2028 2892 3.20 3.19 38,000,000 38,200,840 7.81%
BLUESHORE FINANCIAL CREDIT UNION 190027 BLUESHORE 2.75% APR8/20 6,000,000 6,000,000 Apr ,08 2019 Apr ,08 2020 8 2.75 0.00 190041 BLUESHORE 2.62% JUNE15/20 5,000,000 5,000,000 Jun ,14 2019 Jun ,15 2020 76 2.62 0.00 190046 BLUESHORE 2.61% JUNE29/20 5,000,000 5,000,000 Jun ,28 2019 Jun ,29 2020 90 2.61 0.00 190072 BLUESHORE 2.37% AUG24/20 2,500,000 2,500,000 Aug ,22 2019 Aug ,24 2020 146 2.37 0.00 18,500,000 18,500,000 3.78%
BANK OF NOVA SCOTIA 160042 BNS 2.130% JUN15/20-1705 5,000,000 5,107,250 Aug ,02 2016 Jun ,15 2020 76 1.56 2.13 170050 BNS 2.13% JUN15/20-1843 5,000,000 5,024,500 Aug ,04 2017 Jun ,15 2020 76 1.95 2.13 160043 BNS 2.090% SEP9/20-1706 5,000,000 5,102,500 Aug ,02 2016 Sep ,09 2020 162 1.57 2.09 170060 BNS 2.09% SEP9/20-1853 5,000,000 5,018,600 Aug ,11 2017 Sep ,09 2020 162 1.96 2.09 140110 BNS 3.27% JAN 11/21-1437 3,000,000 3,135,300 Aug ,15 2014 Jan ,11 2021 286 2.50 3.27 180056 BNS 3.27 JAN11/21-1978 5,000,000 5,060,550 Aug ,03 2018 Jan ,11 2021 286 2.75 3.27 140111 BNS 2.873% JUN4/21-1438 4,000,000 4,065,200 Aug ,15 2014 Jun ,04 2021 430 2.61 2.87 170034 BNS 2.29% JUN28/24-1824 2,000,000 1,999,880 Jun ,30 2017 Jun ,28 2024 1550 2.29 2.29 170089 BNS 2.29% JUN28/24-1883 2,500,000 2,429,375 Oct ,11 2017 Jun ,28 2024 1550 2.75 2.29 170090 BNS 2.62% DEC2/26-1884 2,500,000 2,435,500 Oct ,11 2017 Dec ,02 2026 2437 2.94 2.62 180003 BNS 3.10% FEB2/28-1912 5,000,000 4,974,800 Feb ,05 2018 Feb ,02 2028 2864 3.16 3.10 44,000,000 44,353,455 9.07% CANADIAN WESTERN BANK 190044 CWB 2.52% JUNE22/20 5,000,000 5,000,000 Jun ,20 2019 Jun ,22 2020 83 2.52 0.00 180040 CWB GIC 2.84% JUN25/20 5,000,000 5,000,000 Apr ,25 2018 Jun ,25 2020 86 2.84 0.00 170056 CWB 2.751% JUN29/20-1849 5,000,000 5,051,500 Aug ,11 2017 Jun ,29 2020 90 2.38 2.75 170058 CWB 2.751% JUN29/20-1851 5,000,000 5,055,000 Aug ,11 2017 Jun ,29 2020 90 2.35 2.75 180051 CWB 2.751% JUN29/20-1973 5,000,000 4,987,150 Aug ,01 2018 Jun ,29 2020 90 2.89 2.75 190048 CWB 2.52% JULY2/20 5,000,000 5,000,000 Jun ,28 2019 Jul ,02 2020 93 2.52 0.00 190049 CWB 2.54% OCT1/20 5,000,000 5,000,000 Jun ,28 2019 Oct ,01 2020 184 2.54 0.00 190050 CWB 2.55% NOV5/20 5,000,000 5,000,000 Jun ,28 2019 Nov ,05 2020 219 2.55 0.00 190051 CWB 2.56% DEC3/20 5,000,000 5,000,000 Jun ,28 2019 Dec ,03 2020 247 2.56 0.00 190052 CWB 2.57% JAN28/21 5,000,000 5,000,000 Jun ,28 2019 Jan ,28 2021 303 2.57 0.00 180057 CWB 2.881% MAR1/21-1979 2,500,000 2,493,125 Aug ,03 2018 Mar ,01 2021 335 2.99 2.88 190062 CWB GIC 2.38% AUG7/21 5,000,000 5,000,000 Aug ,07 2019 Aug ,06 2021 493 2.38 0.00 190075 CWB 2.63% SEP16/21 5,000,000 5,000,000 Sep ,12 2019 Sep ,16 2021 534 2.63 0.00 190070 CWB 2.83% AUG8/24 2,500,000 2,500,000 Aug ,08 2019 Aug ,08 2024 1591 2.83 0.00 65,000,000 65,086,775 13.31%
CIBC 190054 CIBC GIC 2.38% AUG27/20 5,000,000 5,000,000 Jul ,26 2019 Aug ,27 2020 149 2.38 0.00 190055 CIBC GIC 2.38% SEP24/20 5,000,000 5,000,000 Jul ,26 2019 Sep ,24 2020 177 2.38 0.00 190056 CIBC GIC 2.38% OCT22/20 5,000,000 5,000,000 Jul ,26 2019 Oct ,22 2020 205 2.38 0.00 190057 CIBC GIC 2.38% NOV26/20 5,000,000 5,000,000 Jul ,26 2019 Nov ,26 2020 240 2.38 0.00 20,000,000 20,000,000 4.09%
Performance and Audit Committee
Schedule 2 (Cont'd)
CONTRACT NUMBER AND SECURITY MATURITY DAYS TO DESCRIPTION AMOUNT COST DATE PURCHASED MATURITY DATE MATURITY YIELD COUPON
FIRST WEST CREDIT UNION 190037 FIRSTWEST 2.60% JUNE1/20 5,000,000 5,000,000 May ,30 2019 Jun ,01 2020 62 2.60 0.00 190038 FIRSTWEST 2.60% JUNE3/20 5,000,000 5,000,000 Jun ,03 2019 Jun ,03 2020 64 2.60 0.00 190076 FIRSTWEST CU 2.55% OCT8/20 7,000,000 7,000,000 Oct ,03 2019 Oct ,08 2020 191 2.55 0.00 190077 FIRSTWEST CU 2.55% OCT15/20 7,000,000 7,000,000 Oct ,03 2019 Oct ,15 2020 198 2.55 0.00 190067 FIRSTWEST CU 2.43% APR8/21 5,000,000 5,000,000 Aug ,07 2019 Apr ,08 2021 373 2.43 0.00 190068 FIRSTWEST CU 2.43% MAY6/21 5,000,000 5,000,000 Aug ,07 2019 May ,06 2021 401 2.43 0.00 190069 FIRSTWEST CU 2.45% AUG10/21 5,000,000 5,000,000 Aug ,07 2019 Aug ,10 2021 497 2.45 0.00 190073 FIRSTWEST CU 2.42% SEPT8/21 2,500,000 2,500,000 Sep ,05 2019 Sep ,08 2021 526 2.42 0.00 41,500,000 41,500,000 8.49% G&F FINANCIAL 190078 G&F CU 2.60% OCT8/20 5,000,000 5,000,000 Oct ,03 2019 Oct ,08 2020 191 2.60 0.00 190079 G&F CU 2.60% OCT8/20 2,500,000 2,500,000 Oct ,04 2019 Oct ,08 2020 191 2.60 0.00 7,500,000 7,500,000 1.53% HSBC BANK CANADA 150034 HSBC 1.816% JUL7/20-1563 5,000,000 4,971,850 Jul ,31 2015 Jul ,07 2020 98 1.94 1.82 160050 HSBC 1.816% JUL7/20-1713 2,500,000 2,496,150 Aug ,12 2016 Jul ,07 2020 98 1.86 1.82 170072 HSBC 1.816% JUL7/20-1865 2,500,000 2,471,250 Sep ,11 2017 Jul ,07 2020 98 2.24 1.82 160051 HSBC 2.449% JAN29/21-1714 2,500,000 2,559,250 Aug ,12 2016 Jan ,29 2021 304 1.89 2.45 170052 HSBC 2.449% JAN29/21-1845 5,000,000 5,049,500 Aug ,04 2017 Jan ,29 2021 304 2.15 2.45 160052 HSBC 2.908% SEP29/21-1715 5,000,000 5,231,750 Aug ,12 2016 Sep ,29 2021 547 1.95 2.91 160095 HSBC 2.908% SEP29/21-1761 5,000,000 5,227,800 Aug ,18 2016 Sep ,29 2021 547 1.97 2.91 180058 HSBC 2.17 JUN29/22-1980 2,500,000 2,414,975 Aug ,10 2018 Jun ,29 2022 820 3.11 2.17 30,000,000 30,422,525 6.22% MANITOBA, PROVINCE OF 160061 MANITOBA STRIP SEP5/25 2,400,000 1,971,384 Aug ,15 2016 Sep ,05 2025 1984 2.18 0.00 160055 MANITOBA STRIP MAR5/30 5,000,000 3,472,650 Aug ,15 2016 Mar ,05 2030 3626 2.71 0.00 160056 MANITOBA STRIP MAR5/31 3,000,000 2,002,290 Aug ,15 2016 Mar ,05 2031 3991 2.80 0.00 10,400,000 7,446,324 1.52%
MFA BC 140068 BCMFA 4.15% JUNE 1/21-1386 5,000,000 5,475,700 Jun ,18 2014 Jun ,01 2021 427 2.64 4.15 170098 BCMFA 2.15% DEC1/22-1902 6,000,000 5,996,880 Dec ,01 2017 Dec ,01 2022 975 2.16 2.15 200003 MFA MORTGAGE FUND 7,500,000 7,500,000 Jan ,28 2020 N/A 0.00 0.00 18,500,000 18,972,580 3.88% NATIONAL BANK 190058 NBC GIC 2.34% OCT6/20 5,000,000 5,000,000 Aug ,06 2019 Oct ,06 2020 189 2.34 0.00 190059 NBC GIC 2.34% NOV5/20 5,000,000 5,000,000 Aug ,06 2019 Nov ,05 2020 219 2.34 0.00 190060 NBC GIC 2.34% DEC3/20 5,000,000 5,000,000 Aug ,06 2019 Dec ,03 2020 247 2.34 0.00 190061 NBC GIC 2.34% JAN11/21 5,000,000 5,000,000 Aug ,06 2019 Jan ,11 2021 286 2.34 0.00 180043 NBC GIC 2.87% APR5/21 2,500,000 2,500,000 Apr ,25 2018 Apr ,05 2021 370 2.87 0.00 160036 NATIONAL BANK 1.809% JUL26/21-1699 1,000,000 1,000,000 Jul ,25 2016 Jul ,26 2021 482 1.81 1.81 180044 NBC GIC 2.99% APR4/22 2,500,000 2,500,000 Apr ,25 2018 Apr ,04 2022 734 2.99 0.00 180045 NBC GIC 3.12% APR4/23 2,500,000 2,500,000 Apr ,25 2018 Apr ,04 2023 1099 3.12 0.00 190081 GIC VR NBC 2.65% NOV8/24-2159 2,500,175 2,500,175 Nov ,08 2019 Nov ,08 2024 1683 2.65 0.00 31,000,175 31,000,175 6.34% NEW BRUNSWICK, PROVINCE OF 160058 NEW BRUNSWICK STRIP JUN3/23 1,700,000 1,493,841 Aug ,15 2016 Jun ,03 2023 1159 1.91 0.00 1,700,000 1,493,841 0.31%
Performance and Audit Committee
Schedule 2 (Cont'd)
CONTRACT NUMBER AND SECURITY MATURITY DAYS TO DESCRIPTION AMOUNT COST DATE PURCHASED MATURITY DATE MATURITY YIELD COUPON
NEWFOUNDLAND, PROVINCE OF 160066 NEWFOUNDLAND STRIP FEB5/22 1,100,000 999,900 Aug ,15 2016 Feb ,05 2022 676 1.75 0.00 160068 NEWFOUNDLAND STRIP APR17/23 2,300,000 2,022,850 Aug ,15 2016 Apr ,17 2023 1112 1.93 0.00 160063 NEWFOUNDLAND STRIP APR17/26 1,100,000 851,510 Aug ,15 2016 Apr ,17 2026 2208 2.66 0.00 4,500,000 3,874,260 0.79%
NEWFOUNDLAND HYDRO 160067 NFLD HYDRO STRIP JUL14/22 950,000 856,900 Aug ,15 2016 Jul ,14 2022 835 1.75 0.00 160069 NFLD HYDRO STRIP AUG27/26 1,200,000 926,160 Aug ,15 2016 Aug ,27 2026 2340 2.60 0.00 2,150,000 1,783,060 0.36%
NOVA SCOTIA, PROVINCE OF 170066 NS STRIP JUN1/25 1,950,000 1,575,210 Aug ,18 2017 Jun ,01 2025 1888 2.76 0.00 160059 NOVA SCOTIA STRIP DEC1/25 1,400,000 1,142,988 Aug ,15 2016 Dec ,01 2025 2071 2.19 0.00 3,350,000 2,718,198 0.56% ONTARIO, PROVINCE OF 180059 ONT STRIP JUL13/21 2,500,000 2,318,750 Aug ,10 2018 Jul ,13 2021 469 2.59 0.00 140116 ONT 3.15% JUNE2/22-1443 3,000,000 3,114,480 Aug ,15 2014 Jun ,02 2022 793 2.61 3.15 140115 ONT 2.85%JUNE2/23-1442 4,000,000 4,022,880 Aug ,15 2014 Jun ,02 2023 1158 2.78 2.85 140099 ONT 7.5% FEB 7/24-1426 4,000,000 5,547,200 Aug ,15 2014 Feb ,07 2024 1408 2.82 7.50 140159 ONT STRIP FEB7/24 1,980,000 1,487,059 Sep ,03 2014 Feb ,07 2024 1408 3.06 0.00 140162 ONTARIO STRIP FEB7/24 3,000,000 2,244,000 Sep ,08 2014 Feb ,07 2024 1408 3.11 0.00 170061 ONT EFC STRIP APR11/25 5,000,000 4,045,500 Aug ,14 2017 Apr ,11 2025 1837 2.79 0.00 23,480,000 22,779,869 4.66% PROSPERA 190029 PROSPERA 2.85% APR13/20 5,000,000 5,000,000 Apr ,11 2019 Apr ,13 2020 13 2.85 0.00 190036 PROSPERA 2.65% JUN1/20 2,500,000 2,500,000 May ,30 2019 Jun ,01 2020 62 2.65 0.00 190085 PROSPERA 2.40% (CASHABLE JUN13/20) D 5,000,000 5,000,000 Dec ,16 2019 Dec ,16 2020 260 2.40 0.00 12,500,000 12,500,000 2.56% QUEBEC, PROVINCE OF 180060 QUE STRIP SEPT21/21 2,500,000 2,303,925 Aug ,10 2018 Sep ,21 2021 539 2.64 0.00 160057 QUEBEC STRIP SEP21/22 2,300,000 2,064,319 Aug ,15 2016 Sep ,21 2022 904 1.78 0.00 140101 QUE 3.5% DEC 1/22-1428 5,000,000 5,293,000 Aug ,15 2014 Dec ,01 2022 975 2.71 3.50 140100 QUE 3.0% SEPT 1/23-1427 8,000,000 8,109,600 Aug ,15 2014 Sep ,01 2023 1249 2.83 3.00 160060 QUEBEC STRIP SEP21/24 4,800,000 4,066,080 Aug ,15 2016 Sep ,21 2024 1635 2.06 0.00 160065 QUEBEC STRIP MAR21/26 5,000,000 4,012,500 Aug ,15 2016 Mar ,21 2026 2181 2.31 0.00 160064 QUEBEC STRIP APR1/30 4,900,000 3,395,749 Aug ,15 2016 Apr ,01 2030 3653 2.71 0.00 32,500,000 29,245,173 5.98% QUEBEC HYDRO 160062 QUE HYDRO STRIP AUG26/23 1,400,000 1,221,626 Aug ,15 2016 Aug ,26 2023 1243 1.95 0.00 170062 HYDRO QUE STRIP FEB26/25 5,000,000 4,070,500 Aug ,14 2017 Feb ,26 2025 1793 2.75 0.00 170067 HYDRO QUE STRIP JUL16/25 3,000,000 2,419,200 Aug ,18 2017 Jul ,16 2025 1933 2.74 0.00 9,400,000 7,711,326 1.58% ROYAL BANK OF CANADA 140070 RBC 2.86% MAR 4/21-1385 5,000,000 5,031,500 Jun ,19 2014 Mar ,04 2021 338 2.76 2.86 140106 RBC 2.86% MAR 4/21-1433 5,000,000 5,086,950 Aug ,15 2014 Mar ,04 2021 338 2.57 2.86 150036 RBC 4.93% JUL16/25-1566 5,000,000 5,939,900 Jul ,31 2015 Jul ,16 2025 1933 2.76 4.93 160053 RBC 4.930% JUL16/25-1716 5,000,000 6,207,500 Aug ,12 2016 Jul ,16 2025 1933 1.97 4.93 20,000,000 22,265,850 4.55%
Performance and Audit Committee
Schedule 2 (Cont'd)
CONTRACT NUMBER AND SECURITY MATURITY DAYS TO DESCRIPTION AMOUNT COST DATE PURCHASED MATURITY DATE MATURITY YIELD COUPON
TORONTO DOMINION BANK 170055 TD 1.693% APR2/20-1848 5,000,000 4,982,000 Aug ,11 2017 Apr ,02 2020 2 1.83 1.69 180054 TD 1.693 APR2/20-1976 5,000,000 4,930,350 Aug ,03 2018 Apr ,02 2020 2 2.55 1.69 180090 TD 1.693 APR2/20-2013 2,500,000 2,465,000 Aug ,30 2018 Apr ,02 2020 2 2.60 1.69 140105 TD 2.563% JUN24/20-1432 5,000,000 5,044,000 Aug ,15 2014 Jun ,24 2020 85 2.40 2.56 140104 TD 3.226% JULY 24/24-1431 10,000,000 10,123,800 Aug ,15 2014 Jul ,24 2024 1576 3.08 3.23 27,500,000 27,545,150 5.63%
VANCITY CREDIT UNION 200001 VANCITY 2.5% JAN21/21 5,000,000 5,000,000 Jan ,20 2020 Jan ,21 2021 296 2.50 0.00 5,000,000 5,000,000 1.02%
WESTMINSTER SAVINGS CREDIT UNION 190026 WSCU 2.80% APR6/20 5,000,000 5,000,000 Apr ,05 2019 Apr ,06 2020 6 2.80 0.00 190032 WSCU 2.65% APR23/20 4,000,000 4,000,000 Apr ,23 2019 Apr ,23 2020 23 2.65 0.00 190063 WSCU 2.41% NOV16/20 5,000,000 5,000,000 Aug ,07 2019 Nov ,16 2020 230 2.41 0.00 190064 WSCU 2.43% FEB8/21 5,000,000 5,000,000 Aug ,07 2019 Feb ,08 2021 314 2.43 0.00 190065 WSCU 2.43% APR8/21 5,000,000 5,000,000 Aug ,07 2019 Apr ,08 2021 373 2.43 0.00 190066 WSCU 2.43% MAY6/21 5,000,000 5,000,000 Aug ,07 2019 May ,06 2021 401 2.43 0.00 29,000,000 29,000,000 5.93%
TOTALS 495,480,175 488,899,401 100%
Weighted Average Term: 1.72 Years
Performance and Audit Committee
SCHEDULE 3
METRO VANCOUVER CULTURAL RESERVE INVESTMENTS AS AT MARCH 31, 2020
CONTRACT NUMBER AND SECURITY MATURITY DATE DAYS TO DESCRIPTION AMOUNT COST PURCHASED MATURITY DATE MATURITY YIELD COUPON
200002 VANCITY 2.50% JAN21/21 500,000 500,000 Jan ,20 2020 Jan ,21 2021 296 2.50 0.00 150011 RBC 1.968 MAR2/22-1534 500,000 491,800 Mar ,11 2015 Mar ,02 2022 701 2.22 1.97 150001 TD 3.226 JULY24/24-1519 650,000 674,700 Jan ,09 2015 Jul ,24 2024 1,576 2.77 3.23 160108 MANITOBA STRIP SEP5/26 715,000 556,556 Nov ,14 2016 Sep ,05 2026 2,349 2.57 0.00 TOTALS $ 2,365,000 $ 2,223,056
Weighted Average Term: 3.53 Years
Performance and Audit Committee SCHEDULE 4 METRO VANCOUVER MATURITIES BY SECTOR AS AT MARCH 31, 2020
METRO VANCOUVER MATURITIES BY SECTOR AS AT MARCH 31, 2020
Performance and Audit Committee
SCHEDULE 5
METRO VANCOUVER INVESTMENT HOLDINGS AND LIMITS AS AT MARCH 31, 2020 (% of total portfolio) Corporate Policy Investments Limit as at March 31, 2020 Canada 100.0% 0.0% Provinces rated AA- or better by S&P (or equivalent) British Columbia 50.0% 0.0% Saskatchewan 50.0% 0.0% Manitoba 50.0% 1.4% Provinces rated A- or better by S&P (or equivalent) Alberta 30.0% 0.0% New Brunswick 30.0% 0.2% Ontario 30.0% 2.9% Quebec 30.0% 5.3% Nova Scotia 30.0% 0.4% Newfoundland 30.0% 0.8% Prince Edward Island 30.0% 0.0% Subtotal 50.0% 11.04% Municipal Finance Authority of BC 15.0% 1.4% Government Term 11-30 years 5.0% 0.0% SCHEDULE I/II BANKS Bank of Montreal 20.0% 4.8% Bank of Nova Scotia 20.0% 5.5% CIBC 20.0% 16.1% Royal Bank of Canada 20.0% 2.6% TD Bank 20.0% 3.5% HSBC Bank Canada 15.0% 3.8% National Bank of Canada 15.0% 13.3% Manulife Bank 15.0% 0.0% Canadian Western Bank 15.0% 12.3% BC CREDIT UNIONS Vancity 20.0% 2.3% CoastCapital 20.0% 0.0% Westminster Credit Union 20.0% 6.5% Blueshore 20.0% 7.8% First West 20.0% 5.2% Prospera 20.0% 1.6% G&F Financial 20.0% 2.2% Subtotal 50.0% 25.4%
BC Credit Union Long 2-5 years 30.0% 0.0% Caisse Central Desjardins 5.0% 0.0%
Performance and Audit Committee
5.8
To: Performance and Audit Committee
From: Roy Moulder, Director, Purchasing and Risk Management Financial Services Department
Date: April 20, 2020 Meeting Date: May 6, 2020
Subject: Tender/Contract Award Information – December 2019 to February 2020
RECOMMENDATION That the Performance and Audit Committee receive for information the report dated April 20, 2020 titled “Tender/Contract Award Information – December 2019 to February 2020”.
EXECUTIVE SUMMARY During the period December 1, 2019 and February 29, 2020, the Purchasing and Risk Management Division issued seventeen (17) new contracts, each with a value in excess of $500,000 (exclusive of taxes). In addition, there were seven (7) existing contracts requiring contract amendments which necessitate further reporting to the Performance and Audit Committee. All awards and amendments were issued in accordance with the “Officers and Delegation Bylaws 1208, 284 and 247 – 2014” and the “Procurement and Real Property Contracting Authority Policy”.
Staff have inserted Supplementation General Conditions into existing competitions which identify the present and future challenges resulting from Covid-19 and seek to obtain assurances from the bidding community of their commitment to completing projects on time and on budget under these challenges. Meanwhile, Purchasing and Risk Management continue to seek process improvements through the implementation of an e-bidding solution which will result in better compliance and significant reduction in award processing time.
PURPOSE To provide the Performance and Audit Committee information with regards to contracts, handled through the Purchasing and Risk Management Division, with a total anticipated value at or in excess of $500,000 (exclusive of taxes).
BACKGROUND The Purchasing and Risk Management Division of Metro Vancouver awards contracts for goods, services and construction in accordance with the “Officers and Delegation Bylaws 1208, 284 and 247 – 2014” (Bylaws), and the “Procurement and Real Property Contracting Authority Policy” (Policy) adopted by the Board of Directors on July 11, 2014, effective September 1, 2014. These Bylaws and Policy outline thresholds for competitive bidding and contracting authorities. Contracts in excess of $500,000 will be reported to the Performance and Audit Committee to align with the thresholds outlined in the Policy.
Capital projects may result in the awarding of one or more contracts to complete the project. All contracts are always within budget authority.
33868503 Performance and Audit Committee Tender/Contract Award Information – December 2019 to February 2020 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 2 of 6
COVID-19 PANDEMIC Prior to initiating any new procurement competition, staff review the scope of work in consideration of known challenges to market labour and material availability.
Recently, staff have incorporated language into the competition documents which require bidders / proponents to acknowledge that their submissions have taken into account present conditions and to confirm that based on those conditions they foresee no issues with completing the scope of work without delay or additional cost to Metro Vancouver.
NEW CONTRACTS - $500,000 to $5,000,000 The following contracts were awarded during the months of December 2019 to February 2020 (Details attached as APPENDIX A): (Exclusive of taxes)
1. RS Waldie Consulting Ltd. $920,000 GVS&DD RFP No. 19-298 Reliability Engineering Services - Maintenance Task Analysis Support
2. CH2M HILL Canada Limited (Jacobs) $2,130,970 GVS&DD RFP No. 19-189 Consulting Engineering Services for Westridge Pump Station 1 and 2 Upgrades
3. West Coast Elevator Services Ltd. $588,499 MVHC Tender No. 19-195 Elevator Inspection, Maintenance, and Repairs at Various Metro Vancouver Housing Locations
4. Status Electrical Corporation $1,045,213 GVS&DD Tender No. 19-342 Annacis Island Wastewater Treatment Plant Fibre Optics Networks Installation
5. USP Technologies $983,616 GVS&DD RFP No. 19-231 Supply and Delivery of Peracetic Acid Solution, Dosage System, Equipment Maintenance and Technical Services for the Northwest Langley Wastewater Treatment Plant
6. Tritech Group Ltd. $1,988,768 GVS&DD Sole Source No. 19-186 Construction, Installation and Commissioning of Columbia Pump Station Genset
Performance and Audit Committee Tender/Contract Award Information – December 2019 to February 2020 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 3 of 6
7. ENKON Environmental Limited $611,677 GVS&DD RFP No. 19-334 Consulting and Professional Services for the Combined Sewer Overflow (CSO) Receiving Environment Monitoring Program: 2019/2020 Heather and/or South Hill
8. Associated Engineering (B.C.) Ltd. $1,596,101 GVWD RFP No. 19-341 Conceptual Design of the Cambie-Richmond Water Supply Tunnel - Fraser River Crossing
9. SSI Shredding Systems, Inc. $1,617,040 USD GVS&DD RFQ No. 17-519 Solid Waste Compaction Systems at Coquitlam and Surrey Transfer Stations
10. Pacific Flow Control Ltd. $539,049 GVWD Tender No. 19-307 Supply and Installation of Line Stop for Lower Capilano Road Crossover Isolation
11. Spartan Controls $580,609 GVWD Sole Source No. 20-024 Annual Support Services Emerson Delta V for SCADA/SCFP CDAC/CWTP CDAC Systems
12. Annex Consulting Group $638,906 MVRD RFP No. 20-048 PeopleSoft HCM Operations Support Analyst
NEW CONTRACTS – BOARD APPROVED The following contracts were authorized for execution by the GVS&DD and GVWD Boards of Directors during the months of December 2019 to February 2020 (as such no further information is included in this report):
(Exclusive of taxes)
1. CH2M Hill Canada Limited $5,303,514 GVS&DD RFP No. 19-007 Northwest Langley Wastewater Treatment Plant - Design and Construction Engineering Services – Phase C
2. Northwest Pipe Company $17,531,398 GVWD
Performance and Audit Committee Tender/Contract Award Information – December 2019 to February 2020 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 4 of 6
RFP No. 19-371 Supply and Delivery of Steel Pipe for 2020 Water Services Construction Projects
3. JJM Construction Ltd. $16,599,950 GVS&DD RFP No. 19-194 Construction Services – Burnaby Lake North Interceptor No.2 – Phase 2 – Open Cut Section
4. Clark Builders $25,575,000 GVS&DD RFP No. 19-313 Construction of a Completed Recycling and Solid Waste Drop-off Facility
5. Morrison Hershfield Limited $2,576,631 GVS&DD RFQ No. 17-090 Consulting Engineering Services for the Design and Construction Management of the Surrey Small Vehicle Drop Off Facility – Phase D
AMENDED CONTRACT The following ‘not previously reported’ contract was amended during the months of December 2019 to February 2020 (Details attached as APPENDIX B):
Value of Total Amended Amendments Value of Contract
1. Yellowridge Construction Ltd. $22,531 $513,108 RFP No. 18-081 Construction Management for Services and Construction (At-Risk) for Kingston Gardens Complex
The following previously reported contracts were amended during the months of December 2019 to February 2020 (Details attached as APPENDIX C):
Value of Total Amended Amendments Value of Contract
1. Kenaidan Contracting Ltd. $2,463,731 $19,250,731 ITT No. 17-005 Construction of Annacis Island Wastewater Treatment Plant Cogeneration Backup Power
2. Graham Infrastructure LP $1,994,592 $16,354,690 RFP No. 18-132 Installation of South Delta Main No. 1 – Phase 3
Performance and Audit Committee Tender/Contract Award Information – December 2019 to February 2020 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 5 of 6
3. CH2M Hill Canada Limited $1,265,578 $6,216,445 RFP No. 16-145 Consulting Engineering Services for Coquitlam Intake No. 2 – Project Definition
4. DHI Water and Environment, Inc. $1,950,000 $3,090,000 RFQ No. 17-231 Wastewater Modeling Assistance 5. McMillen Jacobs Associates $623,748 $4,841,951 RFP No. 18-127 Consulting Engineering Services for the Northwest Langley Wastewater Treatment Plant River Crossing Project
6. Associated Engineering (B.C.) Ltd. $529,839 $1,443,251 RFP No. 16-055 Seymour Capilano Filtration Plant Underdrain Repairs – Engineering Services
COMPETITIVE SELECTION PACKAGES - anticipated to be greater than $500,000 (Issued but not awarded) (Details attached as APPENDIX D).
PROCESS ENHANCEMENTS Procurement Process: The Purchasing and Risk Management Division recently awarded a contract to eSolutions Group to utilize their eBidding software, Bids and Tenders. This software will enhance the posting, management and evaluation of all competitions issued by Metro Vancouver. Some of the notable benefits are; 1) the acceptance of electronics submission from bidders / proponents. Thereby eliminating unacceptable submissions resulting from courier delivered packages physically received after the competition closing time, 2) the reduction in paper consumption, 3) the reduction in non-compliance resulting from errors in a bidder’s / proponent’s submission, and 4) Faster turn-around in the evaluation process as the bidders / proponents are required to follow a template format which leads to ease of comparison between submissions.
ALTERNATIVES This is an information report. No alternatives are presented.
FINANCIAL IMPLICATIONS The contract approval process includes a review of available budget. The contracts presented herein are consistent with budget authority provided by the respective Boards.
Performance and Audit Committee Tender/Contract Award Information – December 2019 to February 2020 Performance and Audit Committee Regular Meeting Date: May 6, 2020 Page 6 of 6
CONCLUSION The contracts presented herein were awarded in accordance with the “Officers and Delegation Bylaws 1208, 284 and 247 – 2014” (Bylaws) and the “Procurement and Real Property Contracting Authority Policy” (Policy) and comply with competitive bidding laws and applicable legislation.
Further, the competitive selection packages were carefully crafted by teams of subject matter experts resulting in the award of contracts that are fiscally responsible, and balance risk, economic, ethical and legal obligations.
Attachments
1. APPENDIX A: Information with regard to newly awarded contracts - $500,000 to $5,000,000.
2. APPENDIX B: Contracts amended to a value of more than $500,000 but not previously reported to the Performance and Audit Committee.
3. APPENDIX C: Previously reported contracts that have been amended.
4. APPENDIX D: Competitive Selection Packages anticipated to be greater than $500,000 (Issued but not awarded).
33868503
Performance and Audit Committee
Appendix A No. 1 AWARD OF CONTRACT
RFP No. 19-298
1. A contract was awarded, December 11, 2019 for the Greater Vancouver Sewerage and Drainage District.
To: RS Waldie Consulting Ltd.
in the anticipated amount of up to $920,000 (exclusive of taxes) for Reliability Engineering Services - Maintenance Task Analysis Support over a five (5) year period.
The contract price is within the overall budget.
2. Proponents were invited by Metro Vancouver’s and BC Bid websites and private invitation on September 19, 2019.
Closing Date: October 10, 2019
3. Proposal received (exclusive of taxes): Estimated Cost Over One Year RS Waldie Consulting Ltd. $184,000
4. Proposal reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Liquid Waste Services Department Staff
5. Award was made to the sole proponent.
Performance and Audit Committee
Appendix A No. 2 AWARD OF CONTRACT
RFP No. 19-189
1. A contract was awarded, December 19, 2019 for the Greater Vancouver Sewerage and Drainage District.
To: CH2M HILL Canada Limited (Jacobs)
in the anticipated amount of up to $2,130,970 (exclusive of taxes) for Consulting Engineering Services for Westridge Pump Station 1 and 2 Upgrades over a two (2) year period. The initial award is limited to Phase A – Preliminary Design at a cost of $499,806 (exclusive of taxes) and subsequent phases of the work will be awarded subject to mutual agreement.
The contract price is within the overall budget.
2. Proponents were invited by Metro Vancouver’s and BC Bid websites and private invitation on August 9, 2019.
Closing Date: September 12, 2019
3. Proposals received (exclusive of taxes):
Stantec Consulting Ltd. $1,567,550 WSP Canada Group Limited $1,664,733 R.F. Binnie & Associates Ltd. $1,753,359 AECOM Canada Ltd. $1,957,082 The WSE/MTS Partnership $1,995,764 CH2M HILL Canada Limited (Jacobs) $2,130,970 Kerr Wood Leidal Associates Ltd. $2,198,236
4. Proposals reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Liquid Waste Services Department Staff
5. Award was made to the highest ranked proponent based on the evaluation criteria established in the RFP.
6. The project team and proposed project manager experience and skill-set is well-suited for the project. The proposed methodology addressed all concerns and requirements of the identified scope of services including some value added upgrade options not originally contemplated.
Performance and Audit Committee
Appendix A No. 3 AWARD OF CONTRACT
TENDER No. 19-195
1. A contract was awarded, January 2, 2020 for the Metro Vancouver Housing Corporation.
To: West Coast Elevator Services Ltd.
in the anticipated amount of $588,499 (exclusive of taxes) for Elevator Inspection, Maintenance, and Repairs at Various Metro Vancouver Housing Locations over a possible seven (7) year period. The initial award of $192,600 (exclusive of taxes) is for a period of three (3) years with an option to extend for two (2) additional two (2) year extensions, upon mutual agreement with the successful proponent.
The contract price is within the overall budget.
2. Tenderers were invited by Metro Vancouver’s and BC Bid websites and private invitation on September 16, 2019.
Closing Date: November 15, 2019
3. Tenders received (exclusive of taxes):
West Coast Elevator Services Ltd. $192,600 KONE Inc. $243,072 Transit Elevator Corporation $264,600 Richmond Elevator Maintenance Ltd. $300,292
4. Tenders reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Regional Planning and Housing Services Department Staff
5. Award was made to the lowest compliant bidder.
Performance and Audit Committee
Appendix A No. 4 AWARD OF CONTRACT
TENDER No. 19-342
1. A contract was awarded, January 11, 2020 for the Greater Vancouver Sewerage and Drainage District.
To: Status Electrical Corporation
in the amount of $1,045,213 (exclusive of taxes) for Annacis Island Wastewater Treatment Plant Fibre Optics Networks Installation.
The contract price is within the overall budget.
2. Three (3) firms were shortlisted as a result of RFQ No. 19-332 (publicly advertised on Metro Vancouver’s and BC Bid websites) and invited to bid on ITT No. 19-342 on December 19, 2019.
Closing Date: January 30, 2020
3. Tenders received (exclusive of taxes):
Status Electrical Corporation $1,045,213 Houle Electric Limited $1,069,460
4. Tenders reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Liquid Waste Services Department Staff
5. Award was made to the lowest compliant bidder.
Performance and Audit Committee
Appendix A No. 5 AWARD OF CONTRACT
RFP No. 19-231
1. A contract was awarded, January 15, 2020 for the Greater Vancouver Sewerage and Drainage District.
To: USP Technologies
in the anticipated amount of up to $983,616 (exclusive of taxes) for Supply and Delivery of Peracetic Acid Solution, Dosage System, Equipment Maintenance and Technical Services for the Northwest Langley Wastewater Treatment Plant over a five (5) year period.
The contract price is within the overall budget.
2. Proponents were invited by Metro Vancouver’s and BC Bid websites and private invitation on September 23, 2019.
Closing Date: October 17, 2019.
3. Proposals received (exclusive of taxes):
PeroxyChem LLC $917,180 USP Technologies $983,616
4. Proposals reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Liquid Waste Services Department Staff
5. Award was made to the highest ranked proponent based on the evaluation criteria established in the RFP.
6. The RFP identified the most qualified Proponent, USP Technologies, offering the most beneficial solution for wastewater treatment.
Performance and Audit Committee
Appendix A No. 6 AWARD OF CONTRACT
Sole Source No. 19-186
1. A contract was awarded, January 21, 2020 for the Greater Vancouver Sewerage and Drainage District.
To: Tritech Group Ltd.
in the anticipated amount of up to $1,988,768 (exclusive of taxes) for Construction, Installation and Commissioning of Columbia Pump Station Genset. The anticipated amount is a combination of the successful contractor’s proposed price of $2,042,319 (exclusive of taxes) and less $53,551 (exclusive of taxes) to account for issues identified during negotiations as allowed for in the process.
The contract price is within the overall budget.
2. One (1) firm was shortlisted as a result of RFQ No. 18-426 Group C (publicly advertised on Metro Vancouver’s and BC Bid websites) and invited to bid on Sole Source No. 19-186 on September 5, 2019.
Closing Date: October 18, 2019
3. Proposals received (exclusive of taxes):
Tritech Group Ltd. $2,042,319
4. Proposals reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Liquid Waste Services Department Staff
5. RFQ No. 18-426 Group C – Columbia PS Genset received four (4) responses. The evaluation identified only one firm, Tritech, with sufficient experience and team make-up to proceed to the next stage. As such, staff requested a bid from Tritech only.
Performance and Audit Committee
Appendix A No. 7 AWARD OF CONTRACT
RFP No. 19-334
1. A contract was awarded, January 21, 2020 for the Greater Vancouver Sewerage and Drainage District.
To: ENKON Environmental Limited
in the anticipated amount of up to $611,677 (exclusive of taxes) for Consulting and Professional Services for the Combined Sewer Overflow (CSO) Receiving Environment Monitoring Program: 2019/2020 Heather and/or South Hill. The initial award is limited to 2020 at a cost of $183,548 (exclusive of taxes) – for the Heather CSO, with an option to extend to include the South Hill and/or Willingdon Effects Survey, subject to the availability of budget and mutual agreement with the successful proponent.
The contract price is within the overall budget.
2. Proponents were invited by Metro Vancouver’s and BC Bid websites and private invitation on October 7, 2019.
Closing Date: October 25, 2019
3. Proposals received (exclusive of taxes):
ENKON Environmental Limited $611,677 ERM Consultants Canada Ltd. $957,593 Hatfield Consultants $831,088*
4. Proposals reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Liquid Waste Services Department Staff
5. Award was made to the highest ranked proponent and lowest cost based on the evaluation criteria established in the RFP.
*Estimated amount, as pricing for all optional components requested was not included.
Performance and Audit Committee
Appendix A No. 8 AWARD OF CONTRACT
RFP No. 19-341
1. A contract was awarded, January 28, 2019 for the Greater Vancouver Water District.
To: Associated Engineering (B.C.) Ltd.
in the anticipated amount of up to $1,596,101 (exclusive of taxes) for Conceptual Design of the Cambie-Richmond Water Supply Tunnel - Fraser River Crossing.
The contract price is within the overall budget.
2. Proponents were invited by Metro Vancouver’s and BC Bid websites and private invitation on October 24, 2019.
Closing Date: November 28, 2019
3. Proposals received (exclusive of taxes):
Tetra Tech Canada Inc. $1,446,620 Associated Engineering (B.C.) Ltd. $1,596,101 AECOM Canada Ltd. $1,599,810 Stantec Consulting Ltd. $1,749,579 SNC-Lavalin Inc. $1,927,250 WSP Canada Group Limited $2,543,471
4. Proposals reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Water Services Department Staff
5. Award was made to the highest ranked proponent based on the evaluation criteria established in the RFP.
6. Associated Engineering (B.C.) Ltd. (AE), the clear highest ranked proposal, provided a well thought-out and detailed project methodology along with a team experienced in soft ground tunneling and large trenchless projects. AE demonstrated a good understanding of the project requirements and identified a number of key issues that will need to be properly addressed in order to successfully complete the conceptual design.
Performance and Audit Committee
Appendix A No. 9 AWARD OF CONTRACT
RFQ No. 17-519
1. A contract was awarded, January 28, 2020 for the Greater Vancouver Sewerage and Drainage District.
To: SSI Shredding Systems, Inc.
in the anticipated amount of up to $1,617,040 USD (exclusive of taxes) for Solid Waste Compaction Systems at Coquitlam and Surrey Transfer Stations. The initial award is to supply and install one (1) new compactor at the new Coquitlam Transfer Station at a cost of $1,617,040 USD (exclusive of taxes). The supply and install of a new compactor for the Surrey Transfer Station will be awarded at a future date subject to budget and mutual agreement.
The contract price is within the overall budget.
2. Respondents were invited by Metro Vancouver’s and BC Bid websites and private invitation on December 18, 2017.
Closing Date: January 11, 2018.
3. Proposal received (exclusive of taxes):
SSI Shredding Systems, Inc. $1,617,040 USD
4. Proposal reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Solid Waste Services Department Staff
5. A Request for Qualifications closed in 2018 for the supply and install of a new compactor at the new Coquitlam Transfer Station. Two firms responded. Only SSI Shredding Systems, Inc. met the technical specifications. Staff entered into direct negotiation with SSI Shredding Systems, Inc. and were subsequently awarded the contract.
Performance and Audit Committee
Appendix A No. 10 AWARD OF CONTRACT
TENDER No. 19-307
1. A contract was awarded, January 29, 2020 for the Greater Vancouver Water District.
To: Pacific Flow Control Ltd.
in the amount of $539,049 (exclusive of taxes) for Supply and Installation of Line Stop for Lower Capilano Road Crossover Isolation.
The contract price is within the overall budget.
2. Tenderers were invited by Metro Vancouver’s and BC Bid websites and private invitation on November 1, 2019.
Closing Date: November 28, 2019
3. Tender received (exclusive of taxes):
Pacific Flow Control Ltd. $539,049
4. Tenders reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Water Services Department Staff
5. Three (3) Tenders were received, however, award was made to the only compliant bidder.
Performance and Audit Committee
Appendix A No. 11 AWARD OF SOLE SOURCE CONTRACT
No. 20-024
1. A contract was awarded January 21, 2020 for the Greater Vancouver Water District.
To: Spartan Controls
in the amount of $580,609 (exclusive of taxes) for Annual Support Services Emerson Delta V for SCADA/SCFP CDAC/CWTP CDAC Systems which remotely monitor and control water supply and wastewater collection system sites within the lower mainland.
Provision of necessary support to keep Metro Vancouver’s Emerson Delta V control system products, which the SCADA, SCFP CDAC and CWTP CDAC systems are based upon, running safely with prevention of unscheduled downtime.
Spartan Controls has provided annual support for the past 9 years as they are the only authorized Western Canada Supplier for the services required.
Performance and Audit Committee
Appendix A No. 12 AWARD OF CONTRACT
RFP No. 20-048
1. A contract was awarded, February 4, 2020 for the Metro Vancouver Regional District.
To: Annex Consulting Group
in the anticipated amount of up to $638,906 (exclusive of taxes) for PeopleSoft HCM Operations Support Analyst over a three (3) year period. The initial award is limited to one year at a cost of $212,969 (exclusive of taxes) with an option to extend for two (2) additional one (1) year periods subject to budget approval and mutual agreement.
The contract price is within the overall budget.
2. Eight (8) firms were shortlisted as a result of RFQ No. 17-184 (publicly advertised on Metro Vancouver’s and BC Bid websites) and invited to bid on RFP No. 20-048 on December 17, 2019.
Closing Date: December 23, 2020
3. Proposals received (exclusive of taxes):
IT/IQ Tech Recruiters (Analyst 1) $168,671 S.i. Systems (Analyst 1) $195,931 IT/IQ Tech Recruiters (Analyst 2) $204,450 Annex Consulting Group (Analyst 1) $212,969 S.i. Systems (Analyst 2) $212,969 Annex Consulting Group (Analyst 2) $230,007 PrecisionERP Incorporated (Analyst 1) $238,525 PrecisionERP Incorporated (Analyst 2) $238,525 Randstad Technologies $366,307
4. Proposals reviewed by:
Contractual: Purchasing and Risk Management Division Staff
Technical: Corporate Services Division Staff
5. Analyst 1 brought forward by Annex was the best fit (and highest ranked proponent overall) for the following reasons: Candidate has in-depth understanding of all modules implemented in PeopleSoft 9.2 at Metro Vancouver, including knowledge on technical environment. The candidate also has strong data analysis skills which will be utilized in Metro Vancouver’s integrations and data reporting project work.
Performance and Audit Committee
Appendix B No. 1
CONTRACTS AMENDED TO A VALUE OF MORE THAN $500,000 BUT NOT PREVIOUSLY REPORTED TO THE PERFORMANCE AND AUDIT COMMITTEE
RFP No. 18-081 PURCHASE ORDER No. 623315
Yellowridge Construction Ltd.
Construction Management for Services and Construction (At-Risk) for Kingston Gardens Complex for the Metro Vancouver Housing Corporation
1. Original Value of Contract (exclusive of taxes): $490,577
2. Amendment Value (exclusive of taxes): $22,531
3. Amendment Number: 01
4. Total Amended Value of Contract (exclusive of taxes): $513,108 5. Budget Status:
This contract is funded within the capital budget for this project.
6. Reasons for Amendment to Contract:
This amendment reflects three change orders to Yellowbridge Construction’s contract resulting from unforeseen additional remediation during the deconstruction of the old structure.
Performance and Audit Committee
Appendix C No. 1 AMENDMENT TO A PREVIOUSLY REPORTED CONTRACT
ITT No. 17-005 PURCHASE ORDER No. 146139
Construction of Annacis Island Wastewater Treatment Plant Cogeneration Backup Power for the Greater Vancouver Sewerage and Drainage District
1. Name of Contractor: Kenaidan Contracting Ltd.
2. Date Contract Reported: February 2018
3. Original Anticipated Reported Value of Contract $17,490,000 (exclusive of taxes):
4. Actual Awarded Value of Contract (exclusive of taxes): $16,787,000
5. Amendment Number: 01
6. Value of Amendment (exclusive of taxes): $2,463,731
7. Amendment Type: Additional Services
8. Total Revised Anticipated Amended Value of Contract $19,250,731 (exclusive of taxes):
9. Budget Status:
This contract is funded within the capital budget for this program.
10. Amendment No. 01 is the result of discovered site conditions, safety improvements, additional O&M requests, contractor recommendations, and specification changes during construction of the innovative design, application, and integration of the Cogeneration and Back-Up Power equipment into Metro Vancouver’s Annacis Island Wastewater Treatment Plant (AIWWTP). Corporation pre-purchased four new Finning Caterpillar cogeneration engines (CG’s), two Cummins Stand-by Diesel Generators (SDG’s), Operating Switchgear (SWG), and Control Systems. Additional retrofits and modifications were also made to existing equipment to improve operating requirements and safety standards not initially identified at time of tender. At time of Contract award, it was recognized that given the schedule time frame, several unknowns could not be reasonably determined; they only become evident during construction, integration, and testing of the various systems. The construction phase was also extended by about 5 months due to late delivery of the Corporation pre-purchased equipment. The delivery delays were caused by unanticipated tasks encountered during the equipment fabrication and securing the required road permits from the Ministry of Transportation for the oversized SDG’s.
Performance and Audit Committee
Appendix C No. 2 AMENDMENT TO A PREVIOUSLY REPORTED CONTRACT
RFP No. 18-132 PURCHASE ORDER No. 611257
Installation of South Delta Main No. 1 – Phase 3 for the Greater Vancouver Water District
1. Name of Contractor: Graham Infrastructure LP
2. Date Contract Reported: October 2018
3. Original Anticipated Reported Value of Contract $11,236,298 (exclusive of taxes):
4. Amendment Number: 02
5. Value of Amendment (exclusive of taxes): $1,994,592
6. Amendment Type: Additional Services
7. Total Revised Anticipated Amended Value of Contract $16,354,690 (exclusive of taxes): (includes value of previously reported Amendment No. 1 - $3,123,800)
8. Previous Amendment Explanation (Reported to Performance and Audit Committee July 4, 2019)
Amendment No. 01 is the result of the trenchless crossings of the BC Railway and Deltaport Way which were included in the Request for Proposals as a provisional item pending acquisition of permits and property rights which were not finalized at the time of initial award.
9. Budget Status:
This contract is funded within the capital budget for this program.
10. Amendment No. 2 is primarily the result of conflicting utilities and infrastructure, related construction delay costs and increases in contract quantities.
Performance and Audit Committee
Appendix C No. 3 AMENDMENT TO A PREVIOUSLY REPORTED CONTRACT
RFP No. 16-145 PURCHASE ORDER No. 142229
Consulting Engineering Services for Coquitlam Intake No. 2 – Project Definition for the Greater Vancouver Water District
1. Name of Contractor: CH2M Hill Canada Limited
2. Date Contract Reported: February 2017
3. Original Anticipated Reported Value of Contract $5,457,726 (exclusive of taxes):
4. Actual Awarded Value of Contract (exclusive of taxes): $5,431,819
5. Amendment Number: 01
6. Value of Amendment (exclusive of taxes): $784,626
7. Amendment Type: Additional Services
8. Total Revised Anticipated Amended Value of Contract $6,216,445 (exclusive of taxes):
9. Budget Status:
This contract is funded within the capital budget for this program.
10. Amendment No. 01 is comprised of the addition of risk management services, additional costs due to revised design parameters, as well as, additional engineering services related to development of the project configuration (i.e. tunnel length increase).
Performance and Audit Committee
Appendix C No. 4 AMENDMENT TO A PREVIOUSLY REPORTED CONTRACT
RFQ No. 17-231 PURCHASE ORDER No. 146453
Wastewater Modeling Assistance for the Greater Vancouver Sewerage and Drainage District
1. Name of Contractor: DHI Water and Environment, Inc.
2. Date Contract Reported: July 2018
3. Original Anticipated Reported Value of Contract $1,140,000 (exclusive of taxes):
4. Amendment Number: 01
5. Value of Amendment (exclusive of taxes): $1,950,000
6. Amendment Type: Additional Services
7. Total Revised Anticipated Amended Value of Contract $3,090,000 (exclusive of taxes):
9. Budget Status:
This contract is funded within the capital budget for this program.
10. Amendment No. 01 is the result of unforeseen challenges requiring additional resources to complete and accelerate the original scope of work. This amendments intended to ensure the completion of modeling of the remaining sewerage areas by the end of 2022.
Performance and Audit Committee
Appendix C No. 5 AMENDMENT TO A PREVIOUSLY REPORTED CONTRACT
RFP No. 18-127 PURCHASE ORDER No. 608881
Consulting Engineering Services for the Northwest Langley Wastewater Treatment Plant River Crossing Project for the Greater Vancouver Sewerage and Drainage District
1. Name of Contractor: McMillen Jacobs Associates
2. Date Contract Reported: October 2018
3. Original Anticipated Reported Value of Contract $4,218,203 (exclusive of taxes):
4. Amendment Number: 01
5. Value of Amendment (exclusive of taxes): $623,748
6. Amendment Type: Additional Services
7. Total Revised Anticipated Amended Value of Contract $4,841,951 (exclusive of taxes):
8. Budget Status:
This contract is funded within the capital budget for this program.
9. Amendment No. 01
The consulting team requested additional funds to support the increased level of effort required for project management and permitting support. Longer than expected permitting timelines and the pipe alignment re-alignment resulted in an extended project schedule. The new alignment eliminated the need to cross under a bridge, and made use of existing infrastructure to tie-into while reducing the construction cost and environmental impacts. Additional geotechnical and environmental sampling and topographic survey was required to support the new alignment.
In addition, incorporating O&M feedback into the design required the re-evaluation of the pipe material selection, and the removal of confined space entry where possible. This resulted in design changes that will result in better seismic performance and resiliency of the force main and safe entry for maintenance of our system air valves.
Performance and Audit Committee
Appendix C No. 6 AMENDMENT TO A PREVIOUSLY REPORTED CONTRACT
RFP No. 16-055 PURCHASE ORDER No. 141265
Seymour Capilano Filtration Plant Underdrain Repairs – Engineering Services for the Greater Vancouver Water District
1. Name of Contractor: Associated Engineering (B.C.) Ltd.
2. Date Contract Reported: February 2017
3. Original Anticipated Reported Value of Contract $838,284 (exclusive of taxes):
4. Actual Awarded Value of Contract (exclusive of taxes): $913,412
5. Amendment Number: 01
6. Value of Amendment (exclusive of taxes): $529,839
7. Amendment Type: Additional Services
8. Total Revised Anticipated Amended Value of Contract $1,443,251 (exclusive of taxes):
9. Budget Status:
This contract is funded within the capital budget for this program.
10. Amendment No. 01 is primarily for the addition of full time construction inspection services.
Performance and Audit Committee
Appendix D April 20, 2020
Competitive Selection Packages Anticipated to be greater than $500,000 (Issued but not awarded)
Note: All contracts listed below are within the project budgets approved by the Board of Directors
Tender/RFP Closing Date
RFP No. 19-234 October 31, 2019 Consulting Engineering Services for Preliminary Design, Detailed Design, Construction and Post Construction for the Grandview Pump Station Improvements (Awarded less than $500K)
Tender No. 19-369 December 19, 2019 Construction Services - Seymour Capilano Filtration Plant West Clearwell Concrete Repair (Awarded less than $500K)
Tender No. 19-107 December 12, 2019 Fastener Replacement and Coating at Cleveland Dam and Seymour Falls Dam
RFP No. 19-256 December 12, 2019 Prime Consultant for Water Instrumentation Installation Project
RFP No. 19-333 December 4, 2019 Consulting Engineering Services for the New Outfall at Northwest Langley Wastewater Treatment Plant
RFP No. 19-344 January 28, 2020 Coquitlam Landfill - Landfill Gas Collection System - Operations, Maintenance, Monitoring and Reporting
RFP No. 20-027 February 25, 2020 Consulting Services for the Widgeon Marsh Regional Park Reserve Management Plan
Tender No. 19-253 February 19, 2020 North Surrey Interceptor, 156th Street Section Rehabilitation by Sliplining with Glass Reinforced Polymer/Fiberglass Reinforced Polymer (GRP/FRP) Pipe
Performance and Audit Committee
RFP No. 20-020 February 18, 2020 Supply and Delivery of Liquid Polyaluminum Chloride (PACI) for Seymour Capilano Filtration Plant
RFP No. 19-138 February 11, 2020 Electrical, Instrumentation and Control (EIC) Consulting Engineering Services for Liquid Waste Services Collection Systems
RFP No. 20-019 February 3, 2020 Supply and Delivery of Bulk Hydrated Lime to the Seymour Capilano Filtration Plant
RFP No. 19-284 March 10, 2020 Supply and Delivery of a Trickling Filter Spare Pump
Tender No. 20-021 April 28, 2020 Construction of Kennedy Newton Main – 72nd Avenue to 63rd Avenue
RFP No. 19-065 April 28, 2020 Supply and Delivery of Biofiltration Odour Control System for Gilbert Trunk Sewer Twinning
Tender No. 20-127 April 22, 2020 Supply and Delivery of Two (2) 48-Inch Flexible Single Ball Expansion Joints for the Port Mann Main No.2 (South)
RFP No. 20-015 April 14, 2020 Organics Management at the Langley and Maple Ridge Transfer Stations
RFP No. 20-055 April 2, 2020 Consulting Engineering Services for Five (5) Wastewater Treatment Plants
RFP No. 20-107 May 6, 2020 Services for Civil Construction f
Performance and Audit Committee 5.9
To: Performance and Audit Committee
From: Dean Rear, General Manager, Financial Services/Chief Financial Officer
Date: April 30, 2020 Meeting Date: May 6, 2020
Subject: Manager’s Report
RECOMMENDATION That the Performance and Audit Committee receive for information the report dated April 30, 2020, titled “Manager’s Report”.
1. Municipal Finance Authority Debt Issue On March 26th, the MFA issued $280 million of new debentures of which Metro Vancouver took $165 million as funding for a portion of its capital program. The rate was 1.99% and proceeds were disbursed on April 9th.
2. Rating Agency Presentations Metro Vancouver participated with the MFA team in the ratings agency presentations on April 15th and 16th. While this was the first time that they were done remotely by video conferencing, they went well and one agency, Fitch, has already affirmed the MFABC rating as AAA/Outlook Stable.
3. Performance and Audit Committee Work Plan Update Attachment 1 is the 2020 Work Plan indicating the status of the Committee’s key priorities.
Attachments: 1. Performance and Audit Committee 2020 Work Plan
37085915
Performance and Audit Committee ATTACHMENT 1
Performance and Audit Committee 2020 Work Plan Report Date: April 30, 2020
Priorities 1st Quarter Status Review and Endorse Committee 2020 Priorities and Work Plan Complete Review 2019 External Audit Plan Complete Review 2019 Final Results: Investment Review Position and Returns In Progress Municipal Borrowing Requests for MFA Spring 2020 Issue (If Applicable) Complete Tender / Contact Award Information Complete Financial Policy Review (as required) Complete
2nd Quarter 2019 Audited Financial Statements In Progress 2019 External Audit Findings Report In Progress Review 2019 Final Results: Operating Results vs Budget In Progress Review 2019 Final Results: Capital Expenditures vs Budget In Progress Review 2019 Final Results: Development Cost Charges Collected In Progress GVS&DD DCC Revenue Fund Expenditure Bylaw In Progress Tender / Contact Award Information In Progress Financial Policy Review (as required) In Progress
3rd Quarter Review First 2020 Progress: Investment Review Position and Returns to April 30, 2020 Pending Review First 2020 Progress: Operating Results vs Budget to April 30, 2020 Pending Review First 2020 Progress: Capital Expenditures vs Budget to April 30, 2020 Pending Municipal Borrowing Requests for MFA Fall 2020 Issue (If Applicable) Pending Performance Dashboard Update Pending Tender / Contact Award Information Pending Financial Policy Review (as required) Pending
4th Quarter Review Second 2020 Progress: Investment Review Position and Returns to August 31, Pending 2020 Review Second 2020 Progress: Operating Results vs Budget to August 31, 2020 Pending Review Second 2020 Progress: Capital Expenditures vs Budget to August 31, 2020 Pending Review First 2020 Progress: Development Cost Charges Collected to June 30, 2020 Pending Municipal Borrowing Requests for MFA Spring 2021 Issue (If Applicable) Pending Tender / Contact Award Information Pending Financial Policy Review (as required) Pending
Performance and Audit Committee