2010 BUDGET Town of Markham Ontario, Canada Cover photo Canadian fl ag collage: Cover images represent the four pillars of the Town of Markham’s Community Sustainability Plan — • Healthy Environment • Economic Vitatilty • Social Equity • Vibrant Culture EXECUTIVE SUMMARY We are pleased to present the 2010 Operating, Capital, Building Standards, Engineering, Planning & Design and Waterworks Budgets for the Town of Markham. After extensive discussion and planning involving residents, community and business groups, Council and staff have produced a balanced budget which addresses the social needs of the community, and maintains service levels with a zero percent net tax rate increase in the municipal portion for the second consecutive year. Vital Markham services such as fire protection, waste management and roads services have been supported at 2009 levels. The Town of Markham approved the following 2010 Budgets, totalling $316.2 million: Operating $ 153.8 million Capital $ 77.9 million Building Standards $ 7.2 million Engineering $ 5.1 million Planning & Design $ 4.9 million Waterworks $ 67.3 million Operating Budget The table below reconciles the 2009 Approved Operating Budget (revised to exclude Planning & Design and Engineering along with Building and Waterworks to match 2010) to the 2010 Operating Budget from $151,268,685 to $153,807,527 (figures exclude prior years surplus/deficit): REVENUES Approved 2009 Budget Revenues 151,268,685 2010 Assessment Growth - Tax Revenue 2,105,491 2010 Increase in Investment Income 1,000,000 2010 Adjustments in Other Revenues -566,649 Total 2010 Budget Revenues (excluding prior year surplus/deficit) 153,807,527 EXPENDITURES Approved 2009 Budget Expenditures 151,268,685 2010 Increase in Expenditures 4,276,977 2010 Additional Transfer to the Capital Programs 500,000 HST Provision for Operating and Capital Budgets 355,000 Reduction in Tax-Funded Capital -2,593,135 Total 2010 Budget Expenditures (excluding prior year surplus/defic 153,807,527 At a high level, a lot of work, meetings and inputs are considered in developing the Town’s budget. The preliminary budget was developed with information from a forecast of 2010 economic pressures. All Town departments prepared business plans that were i incorporated into the preliminary budget. The Town of Markham continues to face inflationary pressures in many aspects of its operations. General inflation, waste collection and winter maintenance contracts, other contract renewals, and wage settlements have resulted in increased operating expenditures. Further, the Budget Sub-Committee approved the continuation of the Town's practice of phasing-in future personnel costs related to facility openings and funds have been allocated towards the Cornell Fire Station, the next Library/Recreation facility and a future sports facility. In addition to inflationary pressures, Markham continues to add to its inventory of parks, streetlights, and roads each year, thereby requiring additional resources for the maintenance and replacement of these assets. These pressures increased expenditures in 2010 by $6.1M. Staff continued the Excellence through Efficiency and Effectiveness initiative (E3) that focuses on corporate wide business transformation. This initiative has become an integral part of the annual business planning process and through this process many processes have been reviewed to find expenditure reductions as well increased revenues. To mitigate the increased expenditures, Staff reviewed and identified the following expenditure reductions: $0.5M by reduction in the utility budget through lower consumption resulting from Town-initiated energy efficient programs $0.2M reduction in the Town’s fuel budget due to lower consumption and a price analysis $0.3M from a phase-in of winter maintenance requirements Further, $2.6M reduction in tax-funded capital budget was achieved through the following measures: $1.0M was saved through the development of a pavement preservation strategy. This strategic initiative preserves the roads by proactively treating the surface early in its life to prolong its state of good repair. In fact, this method strengthens the roads during the rehabilitation for longer life and it employs green technologies to reduce emissions, save energy and recycle aggregates and asphalt $0.8M by deferring and/or sustainable reductions in the capital program $0.5M use of alternative funding source (gas tax) $0.3M by extending the life cycle of Town owned fleet The total impact of the above described pressures, totalling $6.1M, and listed reductions, totalling $3.6M, on expenditures is $2.5M. Also, the revenues were reviewed and increased by $2.5M in the areas of assessment growth and investment income along with adjustments to other revenues. ii The net of the expenditures and revenues is a balanced budget and, thus, a zero percent tax rate increase for the second consecutive year. Capital Budget The 2010 Capital Budget of $77.9M includes funding from various sources. The 2010 Capital budget includes $4.2M from the Federal Gas Tax grant, which will fund capital projects in the following areas: Facility Energy Retrofits Curb & Sidewalk Repairs Green Print Community Sustainability Plan Culvert Replacement Civic Centre Conversion to MDE Connection, and Storm Sewers Upgrades In addition, the Town received funding from the Infrastructure Stimulus Fund in the amount of $8.8M and the Recreation Infrastructure Fund in the amount of $5.1M. The Infrastructure Stimulus Fund is being used to fund the following projects: Facility Accessibility Retrofits ($2.1M) Facility Energy Retrofits ($2.0M) Emergency Operations Centre Retrofit ($0.7M) Thornhill Community Centre & Library Renovations/Additions ($4.0M) The Recreation Stimulus Fund is being used to fund the following projects; Saint Roberts Artificial Turf and Bubble ($2.0M) Tennis Court Facility at Angus Glen Community Centre & Library ($1.1M) Outdoor Civic Centre Skating Rink ($2.0M) Other significant Capital projects include the continuation of the tree planting initiative, construction of the Cornell Fire Station, erosion protection and stormwater management projects, waste management initiatives (including new and continuing recycling programs), continuation of Travel Demand Management, design & construction of 6 new parks, town-wide illumination & sidewalk requests, rehabilitation of bridges & culverts, road rehabilitation across the Town, watermain and sanitary sewer construction & replacement, facility improvements at town-owned buildings, permanent washrooms on Markham Main Street, a pool sanitization upgrade at Milliken Mills pool, and the continuation of the facility accessibility program. The 2010 Budget reflects the Town’s commitment to maintain service levels to the community and balances social needs with fiscal prudence. This is a reflection of the Town’s commitment towards fiscal stewardship. Further, consistent with existing Town policies, one-time funding is not used to balance the operating budget and the Town's iii commitment to increase contribution to the capital program by $0.5M is maintained. The Town has also continued to ramp-up the operating budget for future expenditures related to new community centres, libraries and fire Stations. In addition, the Town will be contributing a total of $0.75M to the Land Acquisition and Environmental Land Acquisition Reserve Funds. Building Markham’s Future Together and Strategic Focus Markham has experienced dramatic growth and change during the past decade – and the Town needs to prepare for and manage this change in the years ahead. In 2007, recognizing that we must take the right steps today to prepare for the future, Markham Council and senior staff identified six strategic priorities for Markham. The Town’s goal is to ensure that Markham continues to be a vibrant, successful and sustainable community. First, to check that the Town was on the right track, the Town launched Click with Markham, an innovative award-winning program. The Town asked residents, people who work in Markham and other stakeholders, to share their thoughts on the Town’s strategic priorities, the action plans associated with each priority, and any concerns the Town may have overlooked. More than 5,000 people responded, making Click with Markham one of the most successful programs of its kind in Ontario. Based on this feedback, Council developed Markham’s official strategic direction for the coming years. The Town’s top six strategic priorities include: Growth Management: Design and construction of new parks, the continuation of a Town Directed Growth Strategy, and supporting the development of a Markham Centre Open Space Plan design guideline. Transportation/Transit: New road constructions and road improvements, more street lighting and sidewalks, a Markham Cycling and Pathways system, and the continued implementation of Markham Transportation Demand Management (TDM) initiatives. Environment: Development of a Markham GreenPrint strategy that will further protect the Town’s air, land, water, vegetation, wildlife and all living species and funding for a major tree planting initiative. Investments are also made for additional Stormwater Management Ponds, installing geothermal heating at the Town Civic Centre supplied by Markham District Energy, and the continuation of the Markham Trees for Tomorrow initiative. Municipal Services: Investments are made on various Road Resurfacing & Improvement projects, maintenance and repair at municipal buildings