HomeMy WebLinkAboutOES 05-02
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OFFICE OF THE CHIEF ADMINISTRATIVE OFFICER
MEMORANDUM
March 20, 2002
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To:
Mayor Arthurs
Members of Council
From:
Thomas J. Quinn
Chief Administrative Officer
Subject:
Durham Region "Who Does What Committee"
Stage II Services Review
File: CA4020
Report OES 005-02 is a joint report from the Operations & Emergency Services
Department and the Corporate Services' Department. It provides a synopsis of the
technical and financial impacts on Pickering that the public works services Business
Cases prepared by the "Who Does What" Committee have determined.
There are some very important points raised in the report that I feel is worth repeating to
caution you and assist you as you consider this report and its recommendations.
1.
The recommendations imply only an approval in principle to the study. They do
not imply that an implementation of the change in service delivery is approved,
only that the process should continue on some business cases to the next step,
which is the development of Implementation Strategies.
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2.
Within the Road Rationalization Business Case, the package of roads to be
transferred to Pickering includes RR #37, Finch Avenue, from Altona Road to
Brock Road. (11.95 lane kIn.). As you are well aware, Finch Avenue has many
operational inefficiencies and problems, is a rural cross section road without
sidewalks, for the most part, and requires substantial reconstruction along its
length. The report recognizes approximately $5.9M of needs from 2002-2012.
Accepting this road, with or without a one-way general levy funding transfer of
only $364,500, will severely burden this municipality with pressures to invest
millions of dollars for its upkeep. Is this a liability you are willing to accept?
Report OES 005,.02 recommends that special funding consideration be given to
Finch Avenue during the preparation of the Implementation Strategy; otherwise it
shall be removed from the transfer package.
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Mayor Arthurs
Members of Council
March 20, 2002
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Page 2
3.
The one-time tax increase / decrease for each taxpayer determined within the
business cases is based on the net present value of the estimated costs over a 19-
year period. As a result, most of the business cases present a tax impact that
appears minimal when spread out over 19 years. Furthennore, the use of a 19-
year time frame obscures the short-tenn effects by simply extending the time
frame until positive financial results are visible. However, specifically for the
Road Network Rationalization business case the projected costs are expected to
occur within the first 10 years primarily due to the projected costs related to
bringing Finch Avenue up to urban road standards. Finch A venue estimated costs
represent a 3% increase in the City's portion of taxes to fund debt charges over 10
years.
4.
The Solid Waste Collection Business Case is to be received only. The
Implementation Strategy is to be deferred until infonnation from the Region's
RFP for the three northern municipalities and Clarington can be. processed. City
of Pickering staff is preparing a separate report on the significance of the Regional
Solid Waste RFP.
5.
Until a final decision is made at the Provincial level with respect to the
continuation of downloading pressure and governance issues, it is unrealistic to
expect that both the regional and local municipalities can continue to carry the
financial burden imposed by the Province, and we will continue to be faced with
these financial challenges.
While we recognize the need to streamline processes to provide our constituents
with effective services, there are substantial obstacles that must be overcome.
Case in point - there are certain regional roads within our municipality that must
be attended to in order to deal with the traffic gridlock that is occurring on such
roads as Finch Avenue, Brock Road and Altona Road.
Our constituents are faced with these ongoing day-to-day issues, and it is difficult
to come to some sort of resolution on these matters when the responsibility is
shared between two levels of government. I concur that as a municipality it is
incumbent on us to deal effectively with maintenance matters such as snow
clearing, and it is ludicrous that our snow ploughs clean only certain portions of a
road and then the Region clears another section. This is certainly a cumbersome
way to do business.
However, given the financial constraints we are facing, it is difficult to maintain
our status quo, without even considering increasing the scope of our service
delivery and placing an additional burden on both our financial and human
resources (particularly since we are not being financially compensated in anyway
whatsoever).
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Mayor Arthurs
Members of Council
March 20,2002
Page 3
Please keep in mind that the Report before you (OES 005-02) is recommending an
approval in principle to the study. It does not imply that we should implement a change
in our service delivery, but simply suggests that we should proceed to the next stage by
preparing business cases in preparation of the next step, which is the development of
Implementation Strategies.
TJQ:jh
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Copy: Director, Operations & Emergency Services
Director, Corporate Services & Treasurer
Division Head, Municipal Property & Engineering
City Clerk
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017
REPO R T TO CO UN CIL
FROM:
Richard W. Holborn, P. Eng.
Division Head
Municipal Property & Engineering
DATE: March 18,2002
REPORT NUMBER: OES 005-02
SUBJECT:
Durham Region "Who Does What" Stage II Services Review
RECOMMENDATION:
1.
That the joint Report OES 005-02 be received;
2.
That the Durham Region "Who Does What" Stage II Services Review Business Case
Report - January 2002 prepared by Deloitte & Touche be received for information;
3.
That an Implementation Strategy for the Road Network Rationalization Business Case
using the one-way funding model and special consideration with respect to funding for
Finch Avenue be prepared, through the "Who Does What" Committee for consideration
by the Councils of the Area Municipalities and the Region of Durham;
4.
That Implementation Strategies for Depot Rationalization and Engineering Development
Approvals be prepared through the WDW Committee for consideration by the Councils
of the Area Municipalities and the Region of Durham;
5.
That an Implementation Strategy for Regional Road Maintenance not be pursued due to
the negative Business Case;
6.
That the consideration of an Implementation Strategy for Solid Waste Collection be
deferred until infonnation from current initiatives is available that validates the business
case;
That the "Who Does What" Committee remain intact to deal with customer service
enhancements, and service delivery optimization and agreements regarding road-related
pennits, vehicle and equipment purchasing, ongoing review of road network and depot
rationalization, lead role on infrastructure projects and standardization of chargebacks,
and report back to Area Municipal and Regional Councils with future recommendations
and,
8.
That Report OES 005-02 and Council's recommendations be forwarded to Regional Staff
to be received as the City of Pickering's comments on Region of Durham Report
2002-J-5.
ORIGIN:
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Region of Durham, Works Committee Report 2002-J-5 and the Region's Finance &
Administration and Works Committee Resolution requesting comments by April 5, 2002.
AUTHORITY:
Council of the City of Pickering Resolution # 121/00, Item #5
Report to Council OES 005-02
0 .1 8 Subject: Durham Region - "Who Does What" Stage II Services Review
Date: March 18,2002
Page 2
FINANCIAL Th1PLICA nONS:
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The financial results reviewed during each business case preparation were to assess if each case,
overall, had a positive financial outcome, and to assist in determining whether or not it is
appropriate for the business case to proceed to the implementation stage, which in some cases
this has been supported. However a number of financial issues will need to be further refined
during the implementation stage.
The one-time tax increase/decrease for each taxpayer reported within each business case for each
municipality is calculated based on the net present value of the estimated costs over a 19-year
period. As a result, most business cases present a tax impact that appears minimal when
considering the cost impact relative to the qualitative impact. However, for some business cases,
the costs in the short term, 3 to 5 year time frame, can be quite significant for a municipality and
these are discussed further under each business case. The financial analysis presented under the
business cases represents the impact on the City of Pickering only. It should be noted that the
transfer of Finch Avenue to the City, if approved, carries with it the need for a significant
financial commitment over the next few years.
The Road Rationalization base case reflects no transfer of funding. While other funding models
were studied, the "Who Does What" Committee delayed the selection of funding to be a
consideration during the implementation stage.
There are no immediate financial implications of receiving this report or Report 2002-J-5, or the
Stage II Services Review Business Case Report. It is only upon adopting an Implementation
Strategy of a Business Case that changes will occur. The recommendations do however imply
approval in principle to the study, ensuring the process will continue through development of
implementation strategies up to and including final approval by respective Councils.
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EXECUTNE SUMMARY:
The Public Works Officials "Who Does What" (WDW) Committee has been given the mandate
to investigate ways to improve upon service delivery at less cost to the taxpayer. In response, the
WDW Committee prepared the Stage I Report May 2000, which identified service delivery
concepts that should be investigated further through the development of business caseS and
implementation strategies.
This report identified eleven (11) recommendations related to public works services. Business
Cases have been prepared for eight of the eleven recommendations through the Stage II Services
Review by Deloitte & Touche and the WDW Committee.
The following business cases were reviewed as part of the Stage II Review:
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. Road Rationalization
. Regional Roads Maintenance
. Depot Rationalization
. Solid Waste Collection
. Engineering Development Approvals
. Weed Control Account
. Road Related Permits
. Vehicle and Equipment Purchased
The remaining three recommendations did not require business cases.
The Report has not been reproduced due to its size and complexity in printing. It is available for
viewing in the offices of the Division Head, Muncipal Property & Engineering and the Director,
Corporate Services & Treasurer.
Report to Council OES 005-02
Date: March 18, 2002
0 1 ~J
Subject: Durham Region - "Who Does What" Stage Il Services Review
Page 3
BACKGROUND:
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At the Council meeting of September 18, 2000, the Council of the City of Pickering passed
Resolution # 121/00, Item #5. The resolution, among other things, endorsed Pickering's
participation in Stage II of the Services Review. The WDW Committee prepared Tenns of
Reference, issued a Request for Proposal, heard presentations from candidates and in April 2001,
retained the finn ofDe1oitte & Touche to prepare business cases and implementation strategies.
During the summer of 2001, Treasurers and finance staff were invited to participate given the
emphasis of Stage Il on financial analysis.
In September 2001, an Interim Report on the progress of the Stage II Review was presented to
the Region of Durham Works Committee and was received for infonnation. During the fall, the
City's Operations & Finance staff were working extensively on the business cases through
meetings and review of reports.
At the Council meeting of December 3, 2001, the Council of the City of Pickering passed
Resolution # 160101, Item # 1 receiving a status report, Report OES 32-01 from the Director,
Operations & Emergency Services.
Attached to this report is Report 2002-J-5 from the Commissioner of Works, Region of Durham
and the Durham Region "Who Does What" Stage II Services Review Business Case Report
January 2002, Executive Summary, presented to the Region's Joint Finance & Administration
and Works Committee on January 16, 2002. The Committee considered this matter and passed a
resolution requesting the report be forwarded to all local Area Municipalities for review and
comment, with all comments to be received by April 5, 2002. Further, Regional staff: through
the "Who Does What" Committee is to report back to Regional Committees with a summary of
input received and proposed next steps by May 29,2002.
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The Region's Report 2002 J-5 provides infonnation of the WDW Committee membership and
resources as well as their mandate and method of discussion. It also provides an overview of the
business cases completed by Deloitte & Touche and the business cases completed by the WDW
Committee. It contains recommendations that are consistent with the recommendations of the
consultant, Deloitte & Touche and the WDW Committee with one exception, the Solid Waste
Business Case, which is discussed further in this report.
Business Cases
1.
Road Network Rationalization
The objective of this business case is to realign the ownership of the road network throughout
Durham, to better reflect the nature of usage and inter-connectivity between and among the
Region and Area Municipalities. The Business Case is summarized in Attaclnnent #1. The
recommendation from the Stage II Services Review is that rationalization of the existing road
network should proceed according to the proposal put forth by the WDW Committee. The
recommendation from Report 2002-J-5 is that the Business Case be received and a detailed
Implementation Strategy report be prepared.
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This case involves the transfer of 309.95 lane km of Regional Roads to the Area Municipalities
and the transfer of 46.58 lane km of local roads to the Region of Durham. These numbers
include the City of Oshawa, who did not participate in the Stage II Review.
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Report to Council DES 005-02
Date: March 18, 2002
Subject: Durham Region - "Who Does What" Stage II Services Review
Page 4
The City of Pickering would receive the following roads, to be transferred from the Region.
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RR # 37 Finch Avenue (Altona Road to Brock Road)
RR #38 Whites Road (Bayly Street to south limit)
RR #1 Brock Road (Bayly Street to south limit)
RR #29 Liverpool Road (Kingston Road to Finch Avenue)
RR # 24 Church Street (Bayly Street to Ajax/Pickering borders)
11.95 lane km
1.70 lane km
8.60 lane km
4.60 lane km
2.00 lane km *
TOTAL = 28.85 lane km
*The City of Pickering and the Town of Ajax would revise the boundary road agreement to
include shared maintenance cost responsibilities on a 2.0 lane km segment of Church Street ITom
Bayly Street to Ajax/Pickering borders.
The City of Pickering would transfer the following road to the Region
Third Concession Road (future Rossland Road)
0.85 lane km
The net impact in Pickering is an increase of 28.00 lane k:m which is a 2.9% increase over the
existing 981.00 lane km that is the responsibility ofthe City.
The base case scenario, was developed around five important criteria.
. the present and future capital costs would be the responsibility of the municipal
jurisdiction receiving the road
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. there are no funding transfers between municipalities for improvements forecasted
in the five-year horizon (no-way funding), however, development charges will be
transferred.
. municipalities have identified wherever capital improvements will be fe-prioritized to a
different time ITame (re-prioritized)
. on-going maintenance costs would be the responsibility of the municipal jurisdiction
receiving the road (including traffic signal maintenance for nine locations in Pickering)
. roads would not be transferred to or from the City of Oshawa
Financial Analysis
It is important to note that the no-way funding transfer, as the base case, is not consistent with the
recommendation from the Stage I Services Review which recommended one way funding. The
Stage II Report, however, provides total tax impact calculations for one-way funding (Region -)
Area) and two-way funding. The report also provides impacts if Oshawa is included and if roads
are "re-purposed", which is defined as capital improvements over and above ordinary levels.
Pickering staff identified the following capital improvement costs and timing for the roads being
transferred to the City of Pickering ITom the Region. This information, although speculative, was
incorporated into the base case model for financial impact calculations:
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RR # 37 Finch Avenue
RR # 38 Whites Road
RR # 1 Brock Road
RR # 29 Liverpool Road
RR #24 Church Street
$5,875,579
$ 168,000
$ 390,553
$ 308,053
$3,183,193
(2002 - 2006,2009- 2012)
(2004, 2005)*
(2008)
(2018)
(2003,2013-2015)
* An additional $587,000 was identified and is categorized as fe-purposing and is not included in
the base case.
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Report to Council DES 005-02
Date: March 18, 2002
021
Subject: Durham Region - "Who Does What" Stage II Services Review
Page 5
The base case presents the tax impact of reprioritization with a no-way funding scenario. The
results show an estimated one-time increase in taxes on an average household with CV A of
$200,000 to be 0.16%. This represents an increase of 1.74% on the City's portion of taxes and a
0.55% reduction on the Regional portion of taxes. These percentages are based on a 19-year net
present value of cash flows and can have quite a different impact on a year-to-year basis.
Depending on how the City chooses to fund these costs, the impacts can vary widely.
Furthermore, the use of a 19 year time frame for financial impact obscures the short term
effects by simply extending the time frame until positive financial results are visible.
For the City, the major contributor to the increased costs would be estimates for capital costs
related to bringing Finch A venue up to urban road standards and the improvements identified for
Church Street. For the 19-year period where estimates were provided, a significant part of the
costs occur in the first 10 years. The Finch Avenue estimated costs represent a 3% increase
in taxes to fund debt charges over 10 years.
City of Pickering staff have a significant concern with the transfer of Finch Avenue to Pickering
in its current state. There are inherent operational and financial liabilities with this road which
have been ignored by the Region. The pressures to improve the road will rest entirely on the City
of Pickering. For this reason, it is recommended that Finch Avenue be given special
consideration with respect to funding from the Region during the implementation strategy.
Should the consideration not be acceptable, the business case would have to be revised to
exclude the transfer of Finch Avenue to the City of Pickering. The Implementation Strategy for
Church Street needs to address maintenance and construction cost sharing for the portion of the
road that fonTIS the boundary of Ajax and Pickering.
There were three funding options considered for the Road Network Rationalization business
case: no-way funding; one-way funding; and two-way funding. These funding scenarios
consider additional funds over and above the transfer of development charges. With no-way
funding there was no transfer of general levy funds between the municipality or the Region.
One-way funding included a transfer of general levy funds, related to the transferred roads, from
the Region to the municipality of capital budget amounts included in the Regional forecast for
the period of 2002 to 2004. For the City of Pickering this included a Regional forecasted amount
of $364,500 to be transferred related to Finch Avenue. Two-way funding considered the transfer
of municipal and Regional forecasted budget capital amounts related to the transferred roads.
For the City of Pickering, the two-way funding scenario is the same impact as the one-way
funding scenario as no capital costs are associated with the portion of the Third Concession to be
transferred from Pickering to Durham. As mentioned earlier, the base case was presented on a
no-way funding scenario. For the one-way funding scenario, the results show an estimated one-
time increase in taxes on an average household with CVA of $200,000 to be 0.15% and 0.12%
for the two-way funding scenario. The difference would be the result of the Regional portion of
the tax rate declining from the two-way funding option. The funding option will be discussed
further and decided upon during implementation stage, based on comments received by
municipalities.
The base case for Road Network Rationalization includes reprioritization, which considers the
work identified by the City as necessary on the transferred road is not different from the type of
work identified as a need by the Region. There were other scenarios run that considered
repurposing which means the work identified by the City as necessary on the transferred road is
different than the type of work identified as a need by the Region. For example, a road may be
considered a major arterial road by the City but was not for the Region. For re-purposing the
results show a one-time increase in taxes of $12.36 or 0.43% on an average household with CV A
of $200,000.
Additional outstanding issues to be resolved during implementation strategy preparation
are Oshawa's future participation, funding options, timing of changes to development
charge bylaws at local and Regional levels and the timing of development charge road
transfers.
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Report to Council OES 005-02
Date: March 18, 2002
Subject: Durham Region - "Who Does What" Stage IT Services Review
Page 6
It is recommended that an Implementation Strategy for the Road Network Rationalization
Business Case using the one-way funding model be prepared, through the "Who Does What"
Committee, for consideration by Council.
2.
Regional Roads Maintenance
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The objective of the business case is to have the maintenance on all Regional Roads perfonned
by local area municipalities. The Business Case is summarized in Attachment # 1.
The recommendation from the Stage II Services Review is that the Business Case not be pursued
in its cuaent fonn. Report 2002-J-5 recommends that the Business Case be received and the
suggestions for enhanced co-operative efforts as outlined in the Business Case Report be
pursued.
This case involves the maintenance of 2061.90 lane kIn of Regional Roads be perfonned by the
municipality in which the roads are located. This would, in effect, eliminate road maintenance
service at the Regional level, however, the Region would still have ownership and jurisdiction of
the road. The municipalities would invoice the Region for the maintenance costs. In Pickering,
this would result in an increase of 280.15 lane kIn of roads to be maintained, which is a 29%
increase over the existing 981.0 lane kIn maintained by the City.
Contrary to the Stage I Report expectations, this business case resulted in a tax increase due to
two main factors: .
1) Limited efficiency gains by the area municipalities (staff, equipment, materials)
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2) Lost synergies between road maintenance and sewer and water staff and resources at the
Regional level
The Business Case outlines some recommendations to be pursued to maXImIze operating
efficiency across municipal boundaries rather than solely within. Examples include increased
partnerships, new partnerships, equipment efficiencies, and route optimization studies.
Financial Analysis
Overall this business case showed a negative cost/benefit analysis that resulted primarily from
the shared resources that currently exist between the Regional road maintenance and Regional
water and sewer services. Transfeaing road maintenance to the local level resulted in estimated
additional costs (0.16% for Pickering) to the water and sewer services due to additional Regional
staff and equipment required to replace that which could be transfeaed to area municipalities.
This would be financed through the water user rate (1.9% increase).
It is recommended that an Implementation Strategy for the Regional Roads Maintenance
Business Case not be pursued.
3.
Depot Rationalization
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The objective of this business case is to rationalize the existing twenty-two (22) depot locations
within the Region by reducing the number to fifteen (15) in the short-tenn, through combining or
decommissioning. The Business Case is summarized in Attachment # 1.
The recommendation from the Stage II Services Review is that the Depot Rationalization process
be undertaken as proposed. The recommendation from Report 2002-J-5 is that the Business Case
rationalizing existing depots be received and a detailed Implementation Strategy Report be
prepared.
Report to Council OES 005-02
Date: March 18, 2002
023
Subject: Durham Region - "Who Does What" Stage II Services Review
Page 7
In this business case, the City of Pickering's Works Centre is not affected. It is proposed that the
Region's depot, located in Ajax, which services both the Town of Ajax and the City of Pickering,
will also house the Ajax Operations Centre operations as a combined depot.
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There are two other depots that will be combined to house both Regional and Area Municipal
operations and these are located in Brock and Scugog.
There are four Area Municipal depots. that are recommended for decommissioning, two in Brock,
one in Clarington and one in Scugog.
The merits of the business case include reduced facility operating costs, improved resource
utilization, improved public perception, reduced future capital costs and one-time facility
disposal revenue.
Financial Analysis
Although there is no direct operational or financial impact on the City of Pickering, there is an
indirect financial impact through a change in the Regional portion of the taxes. Overall, this
would result in a slight one-time reduction of $0.24 or 0.01 % on an average household with CV A
of $200,000.
It is recommended that an Implementation Strategy for Depot Rationalization Business Case be
prepared, through the "Who Does What" Committee for consideration by Council.
4.
Solid Waste Collection
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The objective of this business case is to detennine the benefits of consolidating service delivery
of all waste management services at the Regional level. A second objective is to detennine if
additional savings could be achieved while increasing diversion levels through source streaming
at a one-tier level. The Business Case is summarized in Attachment #1.
The recommendation from the Stage II Services Review is that the Business Case be approved so
that an Implementation Strategy can be developed. The recommendation from Report 2002-J-5
is that the Solid Waste Collection Business Case Report be received and preparation of a detailed
Implementation Strategy Report be deferred until such time as further infonnation is available
related to current waste collection initiatives.
There are many new initiatives that municipalities within the Region are investigating involving
diversion and source streaming which may result in potential cost savings or long-tenn
environmental advantages. The City of Pickering is currently operating a Waste Diversion Pilot
Project of 500 homes using a cart-based collection system diverting all organics (kitchen waste)
from the garbage stream. The Region of Durham and the Municipalities of Clarington, Brock,
Scugog and Uxbridge are currently reviewing proposals from an RFP for the curbside collection
of non-hazardous garbage, organics and recyclable waste from residences and businesses. An
award of a contract is expected in the near future.
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These factors, as well as an uneasiness of an assumption of an immediate 15% savings achieved
in collection costs under a one-tier structure, led the WDW Committee to recommend deferral of
the Implementation Strategy at this time. The Business Case demonstrates that overall, the
Region can enhance its current source streams and still operate at a lower cost under a one-tier
service delivery model.
Financial Analysis
This case would involve the transfer of responsibilities for the collection and delivery of solid
waste materials, garbage and compostable yard waste, including Christmas trees from the City of
Pickering to the Region. The City of Pickering's 2001 budget for Solid Waste Management
Services was $1,430,557 for collection, advertising and other programs/administration.
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Report to Council OES 005-02
Date: March 18, 2002
Subject: Durham Region - "Who Does What" Stage II Services Review
Page 8
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The net savings of 0.03% or $ 0.85 on an average home with CV A of $200,000 that are reported
for Pickering from this business case represents a one-time decrease in taxes based upon a 10-
year present value of cash flows. However, this figure represents the ultimate savings and will
not be realized immediately since the City of Pickering is currently in a contract that does not
expire until March 31, 2009. The calculations were completed on the assumption that the status
quo would remain until the expiry of current contracts and that the transfer of responsibilities
would not take place until a future point in time. Therefore, the analysis did not include any
costs related to the cancellation or re-negotiation of contracts and was based on a 10 year present
value of cash flows. Given that the study period represents a time period of 10 years from now,
any financial analysis done today would be relatively meaningless. Given that Pickering's
contract has seven years remaining, our collection costs will probably not decrease. Moreover,
depending upon any further analysis and how the Region decided to recover collection costs from
the municipalities, Pickering's costs could actually increase.
It is recommended that the consideration of an Implementation Strategy for Solid Waste
Collection be deferred at this time.
5.
Engineering Development Approvals
The objective of this business case is to transfer the service of processing engineering drawing
approvals for development applications to the area municipal level. This will provide a one-
window approval to coordinating approvals which is expected to enhance customer service. The
Business Case is summarized in Attachment # 1.
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The recommendation from the Stage II Service Review is that the business case be approved so
that an implementation strategy can be developed. The recommendation from Report 2002-J-5 is
that the Business Case assessing the concept of a "one-window" approach to coordinating
approvals of the engineering component of development applications at the Area Municipal
Level be received and a detailed Implementation Strategy report be prepared.
For Pickering, this case involves the utilization of existing staff in the Development Control
Section of the Planning & Development Department taking on an expanded project coordination
role. The role will allow for one-point-of-contact for the customer in dealing with Area
Municipal and Region review of drawings, but each jurisdiction will maintain their current areas
of responsibility and accountability. The business case determined that detailed cost analysis was
not necessary, as the changes would have been very minor, if any, cost impact. There may be an
increase in time-demands, and a slight change in responsibilities.
It is recommended that an Implementation Strategy for the Engineering Development Approvals
Business Case be prepared through the "Who Does What" Committee for consideration by
Council.
6.
Weed Control Act Enforcement
The objective of this business case is to transfer the responsibility of this service to the Area
Municipalities. This will provide an ability for the Area Municipality to determine and direct its
own level of service, and possibly enhance public perception. The Business Case is summarized
in Attachment # 1.
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The recommendation from the Stage II Services Review is that enforcement of the Weed Control
Act remain the responsibility of the Region of Durham to coordinate and administer. The
recommendation from Report 2002-J-5 is that the Weed Control Act Enforcement Business Case
be received and that no change occurs to the current service delivery model.
Report to Council OES 005-02 Date: March 18, 2002 0 2 ~)
Subject: Durham Region - "Who Does What" Stage II Services Review Page 9
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Over the last five years, the number of inspections occurring out of complaints in Pickering
ranged from 84 in 1996 to 61 in 2000. The most recent compliance rate (2000) was 52.5%,
leaving the Region to cut 47.5% and impose charge-backs. Although this workload is
manageable, and is a service that is essentially a local matter that would seem to support a
transfer to the Area Municipalities, it has been calculated that transferring the program to Area
Municipalities would only result in a $1000 annual savings to the Region, based on 2001
projections.
It is recommended that an Implementation Strategy for the Weed Control Act Enforcement
Business Case not be pursued.
7.
Road Related Permits
The objective of this business case is to provide a one-window approach to processing road
related pennit applications, such as entrances and road occupancy pennits. It was envisaged that
an applicant could go to any municipality within the Region to complete a standardized fonn and
could also have pennits that cross municipal boundaries, processed at one location.
The recommendation from the Stage II Services Review is that a "one-window" approach to road
related pennit processing not be pursued, and that the WDW Committee facilitate introduction of
customer service enhancements to road related pennitting, as outlined in the Business Case. The
recommendation from Report 2002-J-5 is that the Business Case assessing the concept of a "one-
window" approach to Road-Related Pennit Applications processing be received and that the
WDW Committee facilitate introduction of customer service enhancements as outlined in the
Business Case.
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The enhancements to be considered include sharing basic infonnation with respect to each
other's processes should an applicant need to inquire, standardizing fonns, requirements and
fees. Pickering issued approximately 50 entrance pennits, 55 film pennits and 1000 Road
Occupancy pennits in the year 2000.
It is recommended that customer service enhancements and service delivery optimization
agreements be reviewed regarding road related pennits through the "Who Does What"
Committee.
8.
Vehicles and Equipment Purchasing
The objective of the business case is to purchase vehicles and equipment on a co-operative tender
basis. Since many goods and serviGes are currently purchased this way and economies of scale
can provide savings, then this fonn of acquisition should be pursued for vehicles and equipment.
The recommendation from the Stage II Services Review is that the WDW Committee facilitate
the fonnation of a committee of public works staff to work in consultation with the Durham
Purchasing Cooperative to effect the suggestions outlined in the Business Case. The
recommendation from Report 2002-J-5 is the same, but also recommends that the business case
be received.
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Similar to other co-operative purchasing efforts, there is opportunity for the City of Pickering to
specify their needs and requirements, should the choice be made to participate. Purchases that
are common amongst participants have the potential to result in lower pricing due to interest
from a wider spectrum of dealers (competitive pricing) and volume (economies of scaÌe). The
Region purchases its vehicles through a long established reserve well in advance of the annual
budget process. In order for Pickering to meet the Region's schedule for tendering, either pre-
budget approval would be required to secure current model year product, or an initial time lag
would have to be realized, resulting in a delay to receive purchases.
It is recommended that the "Who Does What" Committee look at further options to enhance
vehicle and equipment purchasing on a cooperative basis.
Report to Council OES 005-02
Date: March 18, 2002
02f3
Subject: Durham Region - "Who Does What" Stage II Services Review
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Page 10
9.
Ancillary Recommendations
There are three other recommendations that were addressed in the Stage I Report that did not
require business cases or implementation strategies to be prepared.
Both the Stage II Services Review and the Region Report 2002-J-5 recommend:
1)
That the WDW Committee be the forum for on-going review and rationalization of the road
network and depot locations to provide a periodic evaluation mechanism for these business
programs.
2)
That the proponent/initiator of an infrastructure project involving more than one
municipality take the lead in the design, supervision of construction and contract
administration throughout the project, it being pointed out that the current practice of each
jurisdiction collaborating with one another would also continue.
3)
That the municipalities within Durham Region (including the Region), establish service
agreements, including standardizing administration fees and labour burden costs for road
related services in order to provide greater accountability, and the Works Officials be
requested to detail the service components within the engineering fèe structure being
performed on behalf of another municipality in order that, with the assistance of the
Treasurers, a fee may be established for each engineering service.
These recommendations, if acted upon, would require the involvement of staff from the
& Corporate Services Department and the Operations & Emergency Services Department in
I continuation with the Public Works Officials, Who Does What Committee and, subject to
acceptance of the business cases and implementation strategies, an on-going role in road network
rationalization and depot location optimization. It would also require City of Pickering staff
resources in creating service agreements with the Region for services provided and/or received
related to the public works area. The recommendation regarding the proponent/initiator of
infrastructure projects may require City Staff to emoll in sewer and watermain design courses to
increase revenue (fee for service) ITom the Region for their components.
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Conclusion
This process of service delivery review has been very long and involved, requiring an extensive
amount of staff resources, with end results that are not as definitive as originally hoped. The
failure to identify savings at the Regional level and the long time frame for financial impacts
make a meaningful quantitative analysis difficult, if not impossible. Furthermore, some matters
need a simple discussion based upon the best service model for two governments serving the
public. A quantitative analysis does not take this into consideration.
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ATTACHMENTS:
1.
2.
Region of Durham - Report 2002-J-5
Public Works Officials within Durham Region, "Who Does What" Stage II Services
Review Business Case Report - January 2002 - Executive Summary
Report to Council OES 005-02
Date: March 18, 2002
Subject: Durham Region - "Who Does What" Stage II Services Review
Page 11
027
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Prepared By:
L(I / .--
Ric,hard W. Hot' ro, P. Eng. Everett Bu a
Division Head, Municipal Property & Engineering Director, Operations & Emergency Services
)~
~
C_-- . )tL(P
. ~tine Senior
Manager, Accounting Services
~4~
Gillis Paterson
Director, Corporate Services & Treasurer
RH:ds
Attachments
Copy: Chief Administrative Officer
I: \CO UNC IL \0 ES-OO 5-02 .docMar-02
Recommended for the consideration of Pickering
City Council
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ATTACHMEi\n/ 'f(> REPORT#~ DE.? óó5 -O~'
:L, J t{y ~ , '., ¡'
Regional Municipality of Durham . ",'
To: The Works Committee
From: Commissioner of Works
Report: 2002-J- 5
Date: ' January 16,2002
028
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SUBJECT:
Public Works Officials 'Who Does What' Committee - Stage II Review
RECOMMENDATIONS:
a)
b)
THAT this report be received for information; and,
THAT this report be forwarded to all local Area Municipalities for review and
comment with all comments to be received by March 29,2002; and
, ~'-
c)
THAT upon receipt and review of comments from the Area Municipalities, Regional
staff reports back to Committees by May 29, 2002 with a summary of input'received
and proposed next steps. '
REPORT:
Attachment No.1 Public Works Officials Within Durham Region "Who Does What"
, Services Review -Stage II Review - Executive Summary of Business
Case Reports - January 2002
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In February 2001, Council authorized a Request for Proposals be issued for the detailed
Stage II Review of the earlier Public Works ,Officials Stage I Report findings. A contract
was awarded to Deloitte & Touche in association with Earth-Tech and IMOS, in April 2001.
An Interim Report, outlining the status of the Stage II Review, was submitted to Regional
Works Committee in September 2001.
Public Works Officials IIWho Do~s Whatll Committee
The purpose of the Public Works WDW Committee is to determine how to improve upon
and carry out changes to service delivery in order to provide better, ,more efficient and
effective service and at less cost to the taxpayer.
The WDW Committee, Deloitte & Touche and Area Municipal and Regional staff resources
met frequently over several months to develop the Business Case Report. The City of
Oshawa did not participate in the Stage II review.
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. ATTACHMENT#~TOREPORT#~ 0O5-()~
1- , :¿~ ~ ,., ,
029
Report No.:
2002""-5
Page No.: 2
Members of the Public Works WDWCommittee are currently as follows:
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.' Jack McCorkell, Commissioner of Works, Region of Durham
. Brian Skinner, Director of Operations & Environmental Services, Town of Ajax
. . Judy Avery, Director of Public Works, Township of Brock
. Fred Horvath, Director of Operations, Municipality of Clarington
. Richard Holborn, Diy. Head, Municipal Property & Engineering, City of Pickering
. Larry Postill, Director of Public Works, Township of Scugog
. Ben Kester, Director of Public Works, Township of Uxbridge
. Wayne Hancock, Director of Public Works, Town of Whitby
Members also have designated Alternates to attend in their absence. In addition, the
Committee is pleased to have expertise and assistance from ~flie Region's Finance.
Department and Area Municipal Finance Departments, given the emphasis of the Stage
II Review on financial analysis.
The following staff are Resources and/or Alternates to the Committee who attend WOW
Committee meetings: .
Finances Resources and/or Alternates:
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.. Jim Clapp, Commissioner of Finance, Region of Durham
.. Mary Simpson, Director of Financial Planning, Region of Durham
.. Greg Kirkbride, Director of Finance/Treasurer, Town of Ajax
.. Yvonne deWit, CAO, Township of Scugog
.. Elaine Bellamy, Treasury Services Manager, Town of Ajax
.. Michael Legge, Treasurer, Township of Brock
.. Nancy Taylor, Director of Finance, Municipality of Clarington
.. Lori Gordon, Manager of Accounting, Municipality of Clarington
.. Gil Patterson, Director of Corporate Services & Treasurer, City of Pickering
.. Kristine Senior, Manager of Accounting Services, City of Pickering
.. Kathy McCann, Treasurer, Township of Scugog
.. Ron Mitchell, Treasurer, Township of Uxbtidge
.. Ken Nix, Treasurer, Town of Whitby
.. Denise Pascoe, Manager of Treasury Services, Town of Whitby
Public Works Resources and/or Alternates:
.. Tony Prevedel, Director of Transportation, Region of Durham
.. Ken Thompson, Director of Environmental Services, Region of Durham
.. Cliff Curtis, Manager of Development Approvals, Region of Durham
.. Peter Watson, Manager of Waste Management, Region of Durham
.. Ted Mortson, Operations Manager, Town of Ajax
.. Sara Brown, Manager of Engineering Services, Town of Ajax
.. Thom Gettinby, Deputy Clerk Administrator, Township of Brock
.; Tony Cannella, Manager ~f Engineering, Municipality of Clarington
.. Alex Grant, CAD, Township of Uxbridge
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Report No.:
ATTACHMENT # LTo REPORT # 0 E:S 005-0;'"
:~ , 31 ~ I" ~
2002-J-5
PaQe No.: 3
ono'
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. Ted Rule, Manager of Operational Services, Townof Whitby
. Bill Watson, Manager of Development Services, Town of Whitby
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Susan Siopis, Manager of Transportation Special Projects, acts as Committee Liaison &
Project Manager on behalf of Durham Region Works Department.
Ainslie Wood of Wood~Sloan Inc., who was retained by the WOW Committee for Stage I
of its Review, continues in her role as Committee Facilitator and acts as overall Project
Manager for the Stage II Review.
WDW Committee Members & Resources have met ten times through completion of this
Business Case Report. Agenda &nd Minutes are prepared for each meeting. In addition,
numerous one-on~one meetings have occurred with each Area Municipality and with the
Region, throughout this Review, to obtain/clarify information and to strategize on business
case methodology and approach.' '
The Business Cases
"
'.
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The Stage II Review Business Case Report contains two submissions, as follows:
1) Business Cases prepared by Deloitte & Touche containing the detailed financial
and qualitative analyses for Roads Network Rationalization, Regional Roads
Maintenance, Depots Rationalization, Solid Waste Collection and Engineering
Development Approvals.
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2) Business Cases prepared by the WOW Committee containing analyses for
Weed Control Act Enforcement, Road-related Permits and Vehicle/Equipment
Purchasing, ancillary recommendations, and a report from the Area
Municipalities and Regional Treasurers' group on the issue of standardizing
chargebacks between and among municipalities for work carried out on the
other's behalf. . '
Regional Staff support and endorse the findings of the Business Cases developed by both
Deloitte & Touche and the WOW Committee.
The Stage II Review has two distinct components separating Business Case development
from Implementation Strategy development. This allows' for the Business Case
recommendations to be considered prior to expending resources on Implemel')tation
Strategies. The Stage II Review Business Case Report recommends the following:
1)
Road Network Rationalization
THAT the Business Case rationalizing the existing road network be received and a
detailed Implementation Strategy report be prepared.'
. This business case studied the financial impact and validated the qualitative benefits of
realigning the ownership of the road network throughout the Region of Durham
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Report No.:
ATTACHMENT#~ TO REPORT#~ OO5-ÓÀ
.\ d.J~ ,'- \
\, . ~.~
2002:..1.5
0:31
Page No.: 4
in an effort to better reflect the nature of usage and interconnectivity throughout the Region
as a whole, as proposed in the Stage I Report. The proposal called for a total of 309.95
lane kilo metres to be transferred from the Region to the Area Municipalities and 46.58 lane
kilometras to transfer from the Area Municipalities to the Region as detailed in the following
table:
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Location: Lane Kilometres To Be Lane Kilometres To Be
Assumed By Local Area Assumed By Region-of-
Municipality Durham
Town of Ajax 31.00 20.33
Township of Brock 13.00 0.00
Municipality ~~
of Clarington 5.20 6.00
City of Oshawa 176.50 2.80
City of Pickering 28.85 0.85
Township of Scugog 23.20 0.00
Township
of Uxbridge 0.00 10.60
Town of Whitby 32.20 6.00
Totals: 309.95 46.58
The Deloitte & Touche study recommends that Rationalization of the Road Network
proceed to the implementation strategy phase.
2)
Regional Roads Maintenance
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'THAT the Regional Roads Maintenance Business Case be received and the suggestions
for enhanced co-operative efforts as outlined in the Business Case report be pursued.'
The Regional Roads Maintenance business case investigated the financial and qualitative
aspects of having the maintenance of regional roads performed by the local Area
Municipalities. The recommendation resulting from this study, based on the financial
analysis, does not support regional road maintenance being done at the local level but
instead recommends pursuing optimal operating efficiencies by continuing to review the
provision of various services without regard to municipal boundaries or jurisdictions.
3)
Depot Rationalization
'THAT the Business Case rationalizing existing Depots be received and a detailed
Implementatio~ Strategy report be prepared.' .
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Report No.:
ATTACHMENT#<L TO REPORT# 6es ó~5-o~
:l , 5~~. -
2002-J-5 .'
PaQe No.: 5
')'12...
L 'J
The Depot Rationalization business case considered the financial impact and qualitative
benefits of rationalizing the existing twenty-twp (22) depot locations across the Region by
reducing the number of depots to fifteen (15) in the short term. The following locations
have been identified as opportunities for action in the near future:
For Combining:
-
Ajax Operations Centre and Ajax/Pickering Regional Depot - Ajax Operations
Centre operations to be located at the Region's Ajax/Pickering Depot,
Brock Townships's Sunderland Depot and the Region's Sunderland Depot - Brock's
Sunderland Depot operations to be located at the Region's Sunderland Depot
Scugog's Port Perry Depot and the Region's Scugog Depot - Scugog's Port Perry
Depot operations to be located at the Region's Scugog Depot
For Decommissioning:
Brock's Beaverton Depot
Brock's Cannington Depot
Clarington's Orono Depot
Scugog's Island Depot
Deloitte & Touche has rêcommended proceeding to the implementation strategy stage with
this business case and further recommends that the review continue to allow for the
identification of any future opportunities as they arise.
4)
Solid Waste Collection
-
THAT the Solid Waste Collection Business Case Report be received and preparation of
a detailed Implementation Strategy report be deferred until such time as further information
is available related to current waste collection initiatives.'
This business case investigated the impacts and benefits of consolidating all waste
management services at the Regional level. The study examined current and enhanced
levels of service in diversion and source stream separation. The study determined that
there are savings to be recognized under a one-ti~r system both with current levels of
service and future enhanced levels of service. In fact the study indicates that a one-tier
system can provide an enhanced level of service at a lower cost than current levels of
service in the two-tier system are provided today. Deloitte & Touche recommends
proceeding to the implementation study strategy. However, the WDW committee agreed
to recommend deferral at this time in order to evaluate the results of waste collection
initiatives currently underway. .'
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:{¡t,"J~<,.. TO REPORT# ð es oó5-ö~
~1~ ,'-
033
" 0,.
Report No.:
2002-J.5
Paqe No.: 6
5)
Engineering Development Approvals
'THAT the Business Case assessing the concept of a 'one-window' approach to
coordinating approvals of the engineering component of development applications at the
Area Municipal level be received and a detailed Implementation Strategy report be
prepared.' ,
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As per the recommendations of the Stage I report, the concept of the Area Municipalities
taking the lead in processing engineering development applications was investigated. The
study resulted in the recommendation to proceed with an implementation strategy bèing
developed, for a 'one~window' approach with each jurisdiction providing a' project
coordination role to allow for one-point-òf-contact for the customer while. maintaining their
current areas of responsibility and accountability. . .~
6)
Weed Control Act Enforcement
'THAT the Weed Control Act Enforcement Business Case be received and that no change
occur to the current service delivery modeL' .
This business case investigated the possible impacts and benefits of providing this service
at the local level as per the Stage I Report recommendations. The review resulted in the
WDW Committee's recommendation to continue this service delivery at the Regional leveL
7)
Road-Related Permits
'THAT the Business Case assessing the concept of a 'one-window' approach to Road-
related Permit Applications processing be received and that the 'WDW Committee facilitate
introduction of customer service enhancements as outlined in the Business Case.'
.-.
As per the recommendations of the Stage I report, the concept of a 'one-window' approach
for receiving and processing road related permit applications was investigated. The results
of this study do not support a one-window approach; however, the business case does
identify several areas where customer service enhancements would improve the permitting
process. The WDW committee supports the recommendation to further opportunities in
specific areas of permitting.
8)
Vehicles & Equipment Purchasing
'THAT the Business Case assessing the feasibility of purchasing vehicles and equipment
on a co-operative tender basis be received and that the WDW Committee facilitate the
formation of a committee of public works staff to work in consultation with the Durham
Purchasing Cooperative to effect the suggestions outlined in the Business Case.'
This business case resulted in support for the concept of co-operative tendering for the
purchase of vehicles and equipment. The WDW Committee, supports the '
14
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Report No.:
ATTACHMENT#.LrOREPORT# öG5 605-o~
~, 11~ p.j'
2002-J.5 .
Paae No.: 7
034
recommendation to further this opportunity through development of standard specifications
for vehicles and equipment through a staff team working in co-operation with the Durham
Purchasing Co-operative. .
9)
Forum for On-going Review of Road Network Rationalization and Depot
Rationalization
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'THAT the Public Works Officials' WOW Committee be the forum for on-going review and
rationalization of the road network and depot locations to provide a periodic evaluation
mechanism for these business programs.'
10)
Lead on Infrastructure Projects Involving more than one Municipality
~
'THAT the proponent/initiator of an infrastructure project involving more than one
municipality take the lead in the design, supervision of construction and contract
administration throughout the project; it being pointed out that the current practice of each
jurisdiction collaborating with one another would also continue.'
11)
Standardization of Chargebacks
......
'THAT the municipalities within Durham Region (including the Region) establish service
agreements, including standardized administration fees and labour burden costs, for road-
related services in order to provide greater accountability; and the Works Officials be
requested to detail the service components within the engineering fee structure being'
. performed on another municipality's behalf in order that, with the assistance of the
Treasurers, a fee may.be established for each engineering service.'
As requested by the Stage I review, the Treasurers have identified the inconsistencies in
the current roads related charges amongst the municipalities (including the Region) and
offer some recommendations. Analysis indicated that it would not be equitable to impose
standardized fees as the Area Municipalities have different service levels and different
labour costs ¡contractual obligations. However, it is recommended that service
agreements be established between the Region and each Area Municipality and between
the Area Municipalities if appropriate. Further, it is recommended that the administration
fee for the processing of invoices be standardized. It is also recommended that labour
burden costs be standardized to the extent possible and be set based on approval in the
service agreements. .
The benefits of standardizing comparable services delivery processes are largely
qualitative in nature. The main benefits include identification of the services and explicit
service levels; harmonization of fees, including administration and staff costs;
accountability between municipalities; and definition of responsibilities.
15
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\ - ( n~lY'\DT.u DeS QO5-oó\
ATTACHMENT # -,TO N;rVnI ff-
i1% ~r
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O~15
Report No.:
2002.J.5
Paqe No.: 8
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Engineering fees were reviewed by the Treasurers who determined that there were wide
variations in the processes for charging back for service delivery on construction contracts.
Some municipality's charge a percentage (10% - 15%) of the total construction costs
whereas others charge based on proportionate share of actual invoices received for
contracted services. The components to be included within the engineering fee ~tructure
also varied considerably along with how the service was performed (Le. in-house, outside
consultant, or a combination of both).
NEXT STEPS
This report recommends that the Stage" report be forwarded to the local area
municipalities for review and comment by March 29, 2002. Upon receipt of any comments
a further report, making recommendations to Committees regarding future Implementation
Strategies; will be prepared for those Business Cases where approval to proceed to the
next reporting phase h.as been granted. The Implementation Strategy Report will then be
submitted for consideration and direction to proceed with-implementation.
CONCLUSIONS:
As directed by Council in February 2001, the Who Does What Committee along with staff
resources from municipal Finance departments facilitated the completion and review of
each Business Case as identified in the Stags 1 report. Recommendations related to each
Business Case study are noted above. As noted in the recommendations, the results of
several Business Case studies warrant the advancement of Implementation Strategies.
The attached Executive Summaries provide rationale for each Business Case
recommendation. Two copies of The Stage" Review Business Case Report, in its
entirety, has been forWarded to each Area Municipality. Additional copies will be made
available upon request. '
-
Deloitte & Touche staff will be in attendance to present the Stage II Report. As well,
Ainslie Wood, who has facilitated this second stage of the process and prepared several
Business Cases on behalf of the committee, will be in attendance.
v R. McCorkell, P. Eng
ClOmmissioner of Works
~:~r~
R.J. app, C
Commissioner of Finance
CAM1/cb
16
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~i.O Executive Sumnlary
This report contains the 'findings from the development of five business cases that relate to the
rationalization of Public Works operations within the Region of Durham and the Area
fv1unicipalities, Deloitte & Touche was contracted by the Region to prepare business cases and
implementation strategies based on the areas for review identified in the "Who Does What"
Services Review Stage 1 Report, dated May 2000. Deloitte & Touche's expertise was
complemented by the road maintenance and solid waste expertise of Integrated Maintenance
Operations Inc, and Earth Tech Canada Inc. to ensure that external comparative information was
considered. The purpose of the business cases is to a~sist with the assessment of how best to
irTjprove upon, and carry out changes to service delivery in order to provide better, more efficient
and effective service and at less cost to the taxpayer. The five business cases covered in this
report are:
n '-0'
',' ."J
~
Heads Network Rationalization
Regional Roads Maintenance
Depot Rationalization '
Solid Waste Collection
Engineering Development Approvals
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Implementation Strategies for approved business cases will be presented in a subsequent report.
'Ille City of Oshawa is not an active participant in this, the second stage of the project. In order to
assess the full potential impact on the Regional tax levy and the associated impact on the tax
burden in each Area Municipality, proxy information was utilized for Oshawa based upon input
fn.Jr!l a number of sources.
.-
Swnmary of l':(esults
Roads Network Rationalization (page 3 of executive summary)
Result: This business case demonstrates that the overall cost to the system for reprioritizing
(excluding Oshawa) is an average one-time tax increase of 0.01 % averaged over 19 years for an
average residential household with current value assessment (CVA) of $200,000. This business
case demonstrates further that the end cost to the taxpayer, even after road repurposing, is an
additional tax increase of 0.26% per average household with CVA of $200,000.
Recommendation: We believe that the rationalization of the existing road network should proceed
according to the proposal put forth by the WOW Committee.
Hef:]ional Roads Maintenance (page 10 of executive summary)
Result The overall result of this business case is a net increase of $10.90 on an average
residential home (CVA =$ 200K) that consumes 60,000 gallons of water per year. This arises
from an average water user increase of $7.14 in water and sewer rates, in adclition to a net
genera! levy average tax increase of $3.76 in the general tax levies.
Pe'.;ommendation: This concept should not be pursued in its current form.
17
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ATTACHMENT #
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Depot Rationalization (page 14 of executive summary) 0 :i 7
Result This business case demonstrates that the overall benefit to the system is an average one~
time tax decrease of 0.03% averaged over 19 years for an average residential household with
current value assessment (CY A) of $200,000. This business case has shown that, on an overall
basis, the taxpayer will benefit from the Depot Rationalization process.
-
Recommendation: It is recommended that the Depot Rationalization process be undertaken as
proposed.
Solid Waste Collection (page 17 of executive summary)
Result: The results of this business case demonstrate that overall, the Region can save costs by
moving to a one.tier structure. More importantly, the Region can also enhance its current source,
streams and still operate at a lower cost under a one-tier structure than iJ could by maintaining its
curr~nt two-tier structure with current source streams.
Recommendation: We recommend that this business case be approved so that an
implementation strategy can be developed.
Engineering Development Approvals (page 21 of executive summary)
Result: The review identified the required process changes to achieve a one-window approach
with each jurisdiction required to maintain responsibility and accountability for their respective
engineering decisions and associated financial control. Our review indicated that all process
changes would have a very minor, if any, cost impact, such that a detailed cost analysis was not
deemed necessary. '
Recommendation: We recommend that this business case be approved so that an
implementation strategy çan be dèveloped.
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18
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:1,'¡,___Roads Network Rationalization Business Case
Refer to page 25 for the detailed report.
Bac'.kground
'The objective of this business case is to investigate the financial impact and validate the qualitative
benefits of realigning the ownership of the road network throughout Durham, to better reflect the
nature of usage and inter connectivity between, and among, the Region and Area Municipalities, as
proposed in the WOW Stage I Report. This proposal called for a total of 309.95 lane kilometers to
be transferred from the Region to the Area Municipalities, and 46.58 lane kilometers to be
transferred from Area Municipalities to the Region.
Approach
,i\ rnethodology was developed for this business case that looked at the financial implications of
the proposed transfers in terms of:
t The capital costs that would now be the responsibility of the jurisdiction receiving the road
segment, relative to those avoided by the jurisdiction transferring the road; and
1!1" The on-going maintenance costs that would now be the responsibility of the jurisdiction
receiving the road segment, relative to those avoided by the jurisdiction transferring the road.
Estimates of required capital expenditures were obtained from each jurisdiction. combined with
estimates of incremental maintenance costs. In developing the methodology, it became apparent
that several other factors had a significant impact on the results of the business case. These
included:
" Whether or not the City of Oshawa participated in the transfer - the Stage I report proposed
176.5 lane kilometers'be transferred from the Region to the City of Oshawa and 2.8 lane
kilometers be transferred from the City of Oshawa to the Region:
~ Whether jurisdictions receiving roads intended to change the timing or extent of capital
investment (without changing the type of work to be done compared to the current owners
Roads Needs estimates) due to them placing a different priority on the road compared to the
jurisdiction transferring the road - we define this as "reprioritizing".
ø Whether jurisdictions receiving roads intended to make capital investments over and above
ordinary levels of maintenance in order to repurpose their use - we define this as repurposing,
with the best example being the potential future redevelopment, by the Region, of Rossland
Road into a major, arterial Regional route.
~ The extent of possible funding sources for the capital costs, either from development charges
or, from the transferring jurisdiction during a "funding window". The Stage I Report had
considered the possibility of a funding window until 2004, during which budgeted funds might
be transferred between jurisdictions.
In view of these factors, a base case was developed for this business case that looked at the total
tax impact of transferring and reprioritizing the roads. This was based on the assumption that
roads would not be transferred to, or from, the City of Oshawa. In the base case, no funds would
be transferred between jurisdictions. Over and above the base case, an incremental tax impact
was calculated in the event that Oshawa does participate in the road transfer process, as well as
an incrementa! tax impact from repurposing.
19
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- A1TACHMENT#~ ~~# OE~ Ó~51h2.
Financial Analysis
Tax ilnpacts have been calculated to demonstrate the one time required change in the tax rate
today, in order to meet the funding obligation of each scenario over a nineteen-year period. It is
important to note that these changes to the tax rate are based on averages over the period and
therefore, on a year-by-year basis, actual funding obligations may vary significantly. The tax
impacts are expressed as changes for an average residential home with a current value
assessment of $200,000.
I} :i :]
.-
Refer to figures '1.1 - 1.5 on the following pages.
.; ",..,
-
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Figure 1.1
fJ if U : ':., ':"'" "":',.:.' ,"':":r""_..""":T"f'rT~x:':liñ.'ãcratRejiriõfitizãtiõ1!iêxc£Û1iifr"'èf)$ffåWá
~< -, '.o"'-~:F~/' ,:,,:O af;~a: '::<ii[~~~f '_0" ::: ':-:~~ ;;;:~r-f "r~ f-li~7Ì"7TI1"
. "':,::' , i """':'::'::;':'GDr"ler'a i.:,;--IGoner'"1,,':"':'-"{lotal"'i"!:,~:,:::::Genera, ,,'!General ,.Ilùl.s,":.-.:",;
, " , , ,. ~ ,~V G 'I " .. .__..~_.._--,-------,---, -.---,..., . ,
"'--pïd~:ëriñ~"-:"""----c'ãp¡¡ãl ($5.57) $7.94 -. $2.37 -Ó~41% 1.15% 0.08%
Maintenance ($1.84) $4.11 $2.27 -0.14% 0.59% 0.08%
Total ($1.41) $12.05 $4.64 -0.55% 1.14% 0.16%
-
----..,
---'-
þ,jE!,J".
Capital
Maintenance
.. Total
_-'0-
Whitby
Capital
Maintenance
Total
($5.51) $2.63 ($2.95)
($1.84) ($0.75) ($2.59)
($7.41) $1.88 ($5.53)
($5.57) $13.68 $8.10
($1.84) $1.49 ($O.35)
($7.41) $15.17 $7.76
-0.41%
-0.14%
-0.55%
0.29%
-0.08%
0.21%
-0.10%
-0.08%
-0.18%
-0.41%
-0.14%
-0.55%
'1.67%
0.18%
1.86%)
0.27%
-0.01 %
0.26%
O:shawa "'*
-,..-----.-
Capital
Maintenance
Total
-'-"---
C!arington
Capital
Maintenance
Total
---
Sc;ugog Capital
Maintenance
=---_=.=r Tgtal
UxDridge
Capital
Maintenance
Total
-
($5.57) $1.54 ($4.03)
($1.84) $0.11 ($1.13)
($7.41) $1.65 ($5.76)
($5.51) $12.76 $7.18
($1.84) $9.19 $7.96
($7.41) $22.55 $15.14
($5.57) $- ($5.57)
($1.84) $- ($1.84)
($7.41) $- ($7.41)
$24.19 $18.62
$19.85 $18.01
$44.04 $36.63
-0.41 %
-0.14%
-0.55%
-0.41% I
-0:14%
-0.55%
-0.41 %
-0.14%
-0.55%
O.19'jj,
(LO1 %
0.21%
'I. 74- 'Yo
1.33'%
3.07%
-0.16%
-0.05%
-0.22'%
-0.14%
-0.06%
-0.19%
0.25%
0.27%
0.52%
Brock
Capital
Maintenance
Total
-0.41 %
-0.14%
-0.55%
..%
-%
..%
-0.20%
-0.07%
-0.27%
-0.41%
-0.14%
-0.55%
2.04%
1.67%
3.71%
0.55%
0.53%
'1.08%
Reg Avg Capital ($5.57) $5.83 $0.25 -0.41% 0.66% 0.01%
---, Maintenance ($1.84) $1.93 $0.09 -0.14% 0.22%1 O~õõ%..
------.... 'Total ($7.41) $7.76 $0.34 -0.55% 0.88% 0.01%
'The Changes above reflect the estimated one-time change in taxes on an Average Residential Home with CVA== $ 200,000 for a 19
year net present value of cash Hows for the no-way funding scenario, Note that actual year-by-year funding obligations may vary
significantly.
"Oshawa transfers were not included in this projection therefore the Oshawa local levy will not change,
Total Tax Impact of Reprioritization (excluding Oshawa): This chart indicates the impact of
work identified by the receiving jurisdiction that is not different from the type of work identified as a
need by the current jurisdiction, for the base case no-funding scenario. The Regional average
total tax impact of reprioritization on an average residential home with CV A =$200,000 is an
increase of 0.01 %.
q4
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Arçi\";ti1~1.'1 ,'.,-""'",, ,.
'lttl~
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D
1ft
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Figure 1.2
~r~~
, ::,:.'",,¡;,."':"~.¡':Reg¡örjáP: '" ,'C'pl'a~','a' :':'" ' 'I "~ i"~e;;¡::;¡~ñl"" .:, ".$!l;:t¡,a ".
. .' ", ,~',"~,XU;èriêri.W:~J :: '!..Í)r;a;'à~~I=ral ;::Tolal. ':, '-~.._:_~~:1~(i:l:L~- ,,:,~J..~:~3;!3_~~I_~":"~(..:,_I':~~:_,~,,-,~--_.:_,';
1""""'----"-ë~p¡tãl-($1i:95)---'" "-$2iï.04-"'- , '$-1-6.09 -0.96% 2.37% 0.47%
ì Maintenance ($5.20) $22.51 $17.31 ..0.39% '1.84% 0.51%
I Total ($18.15) $51.55 $33.40 -1.35% 4.22%) 0.98%
"The Changes above refiect the estimated one-time change in taxes on an Average Residential Home with eVA= $ 200,000 for a 19
year net present value of cash flows for the no-way funding scenario, Note that actual year-by-year funding obligations may valY
significantly.
fJLlI
Tax Impact on Oshawa if included: This chart includes the impact of Oshawa's inclusion with
reprioritized work based on the needs identified by Regional roads needs _~stimates. The average
tax impact on an average residential home in Oshawa with CVA =$200,000 if Oshawa is included
is 0,98%.
Figure 1.3
,~,~','=, ~:~~~,__~Eii~iëríï~ãTTåx Iffipãë"t.'?J IncIUþ¡ng.Q~hawa;oli' Rè'ijionái: ~~i1~!:aIJ.-eV'f. ,".~~~~~:~~,;;J
',' -' """""""""""""V"'-:"""""""""'c"'""':"""$"""""""~"-"':""""""""':"""- '(;"¡""""'ë;:::':'."""""""'"
. .','" """"""":""""",',. '.'.....: Annual' har]ge' ".:,'",,~"';:'ii.:~;-'Ir""'" ':":'.Annuê""'lla!!.9..eic""":'/::":""-'"
¡ .. .... - ,:.ii:". J ~~ d; ::' ";::' ~~~ [~j,,!
i Maintenance ($3.36) .0.25%
r--- Total ($10.74) -0.80%
*The Changes above reflect the estimated one-time change in taxes on an Average Residential Home with CVA= $ 200,000 fo\ a 19
year net present value of cash flows for the no-way funding scenario, Note that actual year-by-year funding obligations may V81Y
significantly, Oshawa's local general levy wili be the only local levy impacted by Oshawa's inclusion.
Incrernenta! Ta}{ Impact. of Including Oshawa on Regional General Levy: This chart reflects
reprioritization work with no funding transfers. Oshawa's inclusion only changes the Regional
General Levy in the other jurisdictions. The incremental impact of Oshawa's inclusion on the
Regional General Levy for an average residential home with CVA =$200,000 is a reduction of
0,80%.
-
The transfer of roads to Oshawa allows the Regional general levy to decline by $10.74 per
Average Residential Horne with CVA = $200,000 across the Region. The Oshawa !ocalgeneral
levy, on the other hand, increases by $51.55 per average Oshawa household with CVÞ,. =--
$200,000,
92
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042
Figure 1.4
I ¡"~m1(~j~~rm~T~~;~~:~3~
-' Picl'.ering I Capital" $0.96 I $9.12 i $10.08 0.07% 'f~~:;T--'-o"i~~-;
Maintenance ($1.84) $4.11 $2.27 -0.14% 0.59% 0.08%
Total ($0.88) $13.23 $12.36 -0.07% 1.91% 0.43%
Ajax
Capital $0.96 $7.71 $8.67. 0.07% 0.85% 0.28%
Maintenance ($1.84) ($0.75) ($2.59) -0.14% -0.08% -0.08%
Total ($0.88) $6.96 $6.08 -0.07% 0.76% 0.20%
Capital $0.96 $13.68 $14.64 0.07% 1.67% 0.49%
Maintenance ($1.84) $1.49 ($0.35) -0.14% 0.18% -0.01%
Total ($0.88) $15.17 $14.29 -0.07% 1.86% 0.48%
Capital $0.96 - $0.96 0.07% 0.03%
Maintenance ($1.84) . ($1.84) -0.14% -0.05%
Total ($0.88) '. 1IImIDI--~,. -0.03%
Capital $0.96' $4.10 $5.06 0.07% 0.51% 0.17%
Maintenance ($1.84) $0.11 ($1.73) -0.14% 0.01% .0.06%
Total ($0.88) $4.21 $3.33 -0.07% 0.53% 0.11%
Capital $0.96 $12.76 $13.72 0.07% 1.74% 0.47%
Maintenance ($1.84) $9.79 $7.96 -0.14% 1.33% 0.27%
Total ($0.88) $22.55 $21.68 -0.07% 3.07% 0.74%
Capital $0.96 $0.00 $0.96 0.07% 0.00% 0.03%
Maintenance ($1.84) $0.00 ($1.84) -0.14% 0.00% -0.07%
Total ($0.88) $0.00 ($0.88) -0.07% 0.00% -0.03%
Capital $0.96 $24.19 $25.15 0.07% 2.04% 0.74%
Maintenance ($1.84) $19.85 $18.01 -0.14% 1.67% 0.53%
Total ($0.88) $44.04 $43.16 -0.07% 3.71% 1.27%
Whitby
Oshawa **
Clarington
Scugog
Uxbridge
--
Brock
Capital $0.96 $7.17 $8.13 0.07% 0.81% 0.27%
Maintenance ($1.84) $1.93 $0.09 -0.14% 0.22% 0.00%
Total ($0.88) $9.10 $8.22 -0.07% 1.03% 0.27%
"The Changes above reflect the estimated one-time change in taxes on an Average Residential Home with CVA= $ 200,000 for a 19
year net present value of cash flows for the no-way funding scenario. Note that actual year-by-year funding obligations may vary
significantly.
Reg Avg
Total Tax Impact of Repurposing including Reprioritization (excluding Oshawa): This chart
indicates the impact of the reprioritized road work and the work identified by the receiving
jurisdiction that is different from the type of work identified as a need by the current jurisdiction, for
the no-funding scenario. The Regional average total tax impact of all work identified by the
receiving jurisdiction on an average residential home with CVA =$200,000 is an increase of 0.27%.
I)":'
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-
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Figure 1.5 ,
rt'1.;~é:(~;lñêrëmøfitâliR~iõñãî,,"'v¡râDèfgt1àX~imp¡êt£õf~ëp~šiñg~{Ëxêlùâtn~àJsf1ãWã13à~ .' " } 4 3
í" ,',J ,', .'.: , ": ',i~":ii;: i'~1~!r"Î~~;~!f'J]f~~L~ ~ ':: ~:'~!~;~I~~~~t~1 drtl::fç:~;~: :t#'
--.--.--- Capital' $6.54 $1.34-'-----$7.88--'--"'-'--Õ~49%----'----O-~1Š%-"-' .. ~-'-'O.26% '
Maintenance $- $- $- -'Yo -% -%
Total $6.54 $1.34 $7.88 0.49% 0.15% 0.26%
! :'.: :. '~e.g ic)f1~rAve.t~g~':T~~}.lljí'è~~~!Þ(~~#~.tpß~!.r1 ~ii.~þi!~P.i.ij.g :,~,~P't.~g.t, li#~!~Qíj I(§~p!~JtJhg;¿i!e?;:!
i-~)';+i,~;,~!ii ~1~;~~£i~~¡¡~i;' ¡;ì;ffii~iriE;
,-- Ca-' ital .--$0.96 $:¡:¡¡--SS:ï3' 0.07% - O.81'}~"'"7'"""-'---o.2n~'-
Maintenance $1.84 $1.93 $0.09 -0.14% 0.22% 0.00% .
Total $0.88 $9.10 $8.22 -0.07% 1.03% 0.27%
'The Changes above reflect the estimated one-time change in taxes on an Average Residential Home with CVA= $ 200,000 for a 19 .
year net present value of cash flows for the no-way funding scenario. Note that actual year-by-year funding obligations may vary
significantly. Repurposing excludes the transfer of roads with Oshawa as repurposing intents of Oshawa are unknown.
Incremental Regional Average Tax Impact of Repurposing (Excluding Oshawa**): This chart
isolates the impact of Repurposing from that of Reprioritizing for the no-funding scenario. The
incremental Regional average total tax impact of Repurposing on an average residential home with
CVA =$200,000 is an increase of 0.26%.
Regional Average Tax Impact of Repurposing including Reprioritization (Excluding
Oshawa**): This chart indicates the total impact of repurposing and reprioritizing the roads in the
receiving jurisdictions based on the needs identified by the receiving jurisdictions for the no-
funding scenario. The Regional average total tax impact of all work identified by the receiving
jurisdiction on an average residential home with CVA =$200,000 is an increase of 0.27%.
-
The impact of repurposing results in an incremental increase of $6.54 on the Regional general levy
from the base case of reprioritization but the total impact of repurposing combined with
reprioritization is still an overall reduction in the Regional levy of $0.88 per average residential
home with CVA of $200,000. The incremental impact measures the change from the base case of
repríoritization excluding Oshawa. On an average basis, the local levy increases incrementally
from the base case scenario of reprioritization by $1.34 per average residential home with CVA of
$200,000, which is comprised of incremental increases of $1.18 in Pickering, $5.08 in Ajax and
$2.56 in Clarington.
Qualitative Analysis
The major qualitative benefit of this business case is that direct accountability will be improved.
The realignment of the road network as a result of this process will allow for improved control and
responsiveness at all levels. Those roads that are local in nature in terms of purpose and usage
will be transferred to Area Municipal control. Similarly, the Region will assume control of those
roads that are major inter-municipal arterial roads in terms of purpose and usage. In both cases,
the roads will now be subject to the appropriate lèvel of control, clarifying accountability.
~,
-
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24
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1.2.
Reqional Roads Maintenance Business Case
045
Refer to page 39 for the detailed report.
Background
The objective of the Regional Road Maintenance business case is to investigate the financial
impact and validate the qualitative'aspects of performing maintenance of Regional Roads at the
Area Municipal level, as proposed in the WOW Stage J Report. Under this proposal, the Region
would continue to be the owner of the Regional road network; however, maintenance would
essentially be "outsourced" to the Area Municipalities. The Region would make payments to the
Area Municipalities for the maintenance services provided on Regional roads. Currently there are
several Area Municipalities providing various Roads Maintenance services on select Regional roads
within their jurisdiction, with costs charged back to the Region.
The original premise behind this business case was that it would be more effective for service
delivery of Regional Road Maintenance to be performed by Area Municipalities, since those new
responsibilities could be integrated with the existing responsibilities of maintaining Area Municipal
roads. Efficiencies were expected through improved utilization of both staff and equipment.
However, early in the business case development process, it became apparent that no immediate
operating efficiencies would be achieved. In addition, existing synergistic efficiencies would be lost
between Regional Road Maintenance and Regional Water and Sewer operations. (Water & Sewer
regularly co-ordinates with and uses Roads staff to assist in the repair of roads and sidewalks after
water or sewer work.) As such, the result of this business case is negative. Although the business
case is negative, there are opportunities to explore other avenues for operational efficiencies and
enhancements. These are outlined in the Conclusions section.
The remainder of this business case explains the approach undertaken and the assumptions
employed that yielded the negative result.
Approach
A methodology was developed for this business case that looked at the financial implications of
the proposal in terms of:
II The additional operating costs that Area Municipalities would incur to maintain all Regional
roads in their jurisdiction, relative to those saved by the Region;
II The impact of required expenditures on incremental vehicles, equipment and facilities;
" The impact of Area Municipalities billing their service delivery costs to the Region, inclusive of
an administrative fee; and
II The impact of severing the current synergies between Regional road maintenance and water
and sewer services.
For the business case the transfer of assets and employees from the Region to the Area
Municipalities was assumed to take place at zero cost. However, the practical feasibility of this
assumption would need to be re-examined during the development of an Implementation Strategy.
It is likely that additional costs would be incurred that would further reduce the value of the
business case.
The number of Regional road kilometers was calculated within each Area Municipality, which was
then used to estimate the incremental level of resources required in order to pertorm maintenance
activities on those roads. In addition to this, the Regional Water and Sewer group was asked to
.ryc
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.....
f)46
identify resource requirements that would be required in order for them to maintain their existing
levels of service.
-
Area Municipalities were assumed to take on the responsibility for maintenance of the Regional
road kilometers within their jurisdiction. In return, they received compensation fralT! the Region for
the cost of providing the required maintenance plus an estimated 8% administrative fee. It was
further assumed that Regional Water & Sewer operations would need to hire staff and obtain
equipment to replace the effort currently provided by the Regional road crews.
Financial Analysis
Figure 1.6
: "
---~IC~:~~~--~~.-6-;-~2.;;--:--$4.57' 0.49% -0.30% -~.16% 1'~~% r---;;~~~-'---"-~~;-~~;-1-"'
i\jax
$6.63
($1.62)
$5.01
0.49%
-0.18%
0.16%
1.90%
$7:14
$'12.15
Whitby
$6.63
($1.14)
$5.49
-0.14%
i
I
0.18% I
0.12% I
0.49%
1.90%
$7:14
$12.63
OshaW3
$6.63
($2.64)
$3.99
0.49%
-0.22%
1.90%
$7.14
$'11.13
C!a¡ington
$6.63
($4.38)
$2.25
0.49%
-0.55%
0.08%
1.90%
$7:14
$9.40
--"-"-
Sc:ugCQ
$6.63
($5.57)
$1.06
0.49%
-0.76%
0.04%
1.90%
$7.14
$8.20
~
Uxbridge
$6.63
($5.92)
$0.71
0.49%
.1.01 %
0.03%
1.90%
$7.14
$7.86
Brock $6.63 ($12.73) ($6.10) 0.49% .1.07% -0.18% 1.90% $7.14 $1.05
Reg Avg $6.63 ($2.88) $3.76 0.49% -0.32% 0:12% 1.90% $7:!4 ¡-;-;~
"The Changes above reflect the estimated one-time change in taxes on an Average Residential Home with CVA= $ 200,000 for a '19
year net present value of cash flows. Note that actual year-by-year funding obligations may vary.
*" The Water Rates Impacts above reflect the estimated change for an average water and Sewer user that consumes 60,000
gallons/year.
The overall result of this business case is a net increase of $10.90 on an average residential home
((:VA =$ 200K) that consumes 60,000 gallons of water per year. This arises from an average
water user increase of $7.14 in water and sewer rates, in addition to a net general levy average tax
increase of $3,76 in the general tax levies. The Regional general levy increases by an average of
$6063, approximately two thirds of which is attributable to the 8% administrative charge that the
Hegion pays the Area Municipalities over and above their costs of providing the service, with the
remainder attributable to the net increase in resources. However, this is countered by the fact that
the local general levy decreases by an average of $2.88, which is due to the fact that the t\rea
!V!unidpalities recover their costs plus the 8% administrative charge.
-
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Contrary to the Stage I Report expectations, the business case is negative for this rationalization
initiative. There are two primary reasons for this result: limited efficiency gains in the planned
integration of Regional road maintenance with Area Municipality road maintenance; and, loss of
shared resources between Regional Water and Sewer and Roads and thus the need for increased
staff and equipment in Water and Sewer.
The limited efficiency gains in integrating Regional road maintenance with Area Municipality
maintenance are a result of:
It Given relatively small geographic areas, the estimates for Area Municipal incremental resource
requirements only yielded savings of parts of resources (e.g., 0.3 full time equivalents), rather
than whole bodies. In this instance, Area Municipalities took the conservative approach and
included full body complements as partial full time equivalents are not feasible;
fI The Region will still require a number of supervisory positions in order to perform service
quality assurance activities...-
. There are no savings in vehicle maintenance activities at the Regional level since vehicle
transfers are spread across all Regional depots and therefore the number of vehicles required
to be maintained per mechanic does not pass the threshold for staff reduction.
047
The increase in water and sewer rates is attributable to the increased costs incurred by the
Regional water and sewer operation that arise because the existing synergy with Regional roads
maintenance will be lost if the activities are transferred to Area Municipalities. This synergy
currently exists because the Region can call upon road crews and equipment to assist with water
apd sewer projects on an as needed basis, in order to supplement demand on their own
resources.
,
-
Investigation revealed that Regional water and sewer operation requires an incremental number of
eleven full time equivalents and capital equipment purchases. This need is driven on a depot-by-
depot basis to have a crew of six available to perform road-patching activities.
Qualitative Analysis
There are several qualitative aspects to this business case which counter, in some part, the
negative financial result:
.
Public perception may improve as centralized routing within each Area Municipality may help to
avoid perceived duplication in activities; and
Customer access will improve, as Area Municipalities will have control over all maintenance
activities within their geographic jurisdiction.
e
Conclusions
The primary intent of the transfer and consolidation of Road Maintenance was to improve
efficiency and effectiveness of road maintenance within the Region and local Area Municipalities.
The foregoing analysis indicates that there are no savings to be obtained at the maintenance
operationalleve!. Key factors behind this conclusion include:
.. The inability of the Region and Area Municipalities to eliminate "parts" of resources; and
. The need for the Region to maintain supervisory positions to monitor Area Municipal
"contractor" performance (which continues to be necessary from a due diligence/risk
management perspective).
23
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In addition, the proposed change is also affected by inefficiencies introduced by separating parts
of the Regional VI/ater and Sewer Division from its Road Maintenance counterpart. As a result, the
business case as proposed yields a negative result for the taxpayer because the lost synergies
currently available between Regional Road Maintenance and Water. and Sewer operations
significantly 'Outweigh the available operating efficiencies from performing all road
maintenance at the Area Municipal level.
Over and above the negative result as quantified in this report, there are a number of
implementation obstacles that would need to be addressed. Given the potential impact upon staff,
the transfer of road maintenance activities from the Region to the local Area Municipalities would
rec¡uire considerable effort and resources to implement. Within the ReQion and Area
~..,,~' '~"~-" '
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In addition, the proposed change is also affected by inefficiencies introduced by separating parts
oftbe Regional Wate~ and Sewer Division from its Road Maintenance counterpart. As a result, the
business case as proposed yields a negative result for the taxpayer because the lost synergies
currently available between Regional Road Maintenance and Water. and Sewer operations
significantly 'Outweigh the available operating efficiencies from performing all road
maintenance at the Area Municipal level.
Over and above the negative result as quantified in this report, there are a number of
implementation obstacles that would need to be addressed. Given the potential impact upon staff,
the transfer of road maintenance activities from the Region to the local Area Municipalities would
require considerable effort and resources to implement. Within the Region and Area
Municipalities, there are multiple Collective Bargaining Agreements, all with their own unique
features, raising a number of transition issues and challenges that would need to be overcome. In
addition to this, an equitable mechanism for vehicle transfers would have to be determined, formal
service level agreements would have to be negotiated, and performancé measurement systems
developed jointly between the Region and the Area Municipalities. All of these activities would
require an investment in staff time to complete.
It is likely that resolution of these issues would increase the negative result of the business case.
As such, our recommendation is that this concept should not be pursued in its current form.
However, this exercise has highlighted the need to pursue maximum operating efficiency across
Area Municipal boundaries rather than solely within. '
(II A route optimization study should be investigated to provide inter-municipal opportunities for
potential efficiencies. This would help to alleviate individual Area Municipalities' inabilìty to
eliminate "parts" of resources since the reduction could be performed across more than one
Area Municipality. .
@! Discussions between the Region and Area Municipalities should occur to further investigate
and implement efficiencies in equipment and human resources.
~ Currently, there are effective maintenance partnerships/ collaborations that exist between the
Region and Area Municipalities that may be evaluated and expanded. New partnerships
between the Region and Area Municipalities may be created.
'" Partnerships also currently exist between Area Municipalities and may be re-evaluated and
renegotiated to create additional operating efficiencies. New partnerships may also be created
between Area Municipalities. '
29
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1.3.
Depot Rationalization Business Case
¡¡~ !f1 ()
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.....
Refer to page 53 for the detailed report.
Background
The objective of the Depot Rationalization business case is to investigate the financial impact and
validate the qualitative benefits of rationalizing existing depot locations across the Region, as
proposed in the WOW Stage Report.
Approach
Depot Rationalization was founded on the premise that the number of depots within the Region
could be reduced from the current level of twenty-two to fifteen in the short-term. As such, a
number of individual transactions have been identified that can be undertgken to provide value and
improve efficiency. The following transactions have been reviewed: "
For CombininG (in the near future):
It No.1 (Ajax Operations Centre) & No. 20 (Region - Ajax/Pickering Depot) - Ajax Operations
Centre operations to be located at Region's Ajax/Pickering Depot
.. No.5 (Brock - Sunderland) & No. 18 (Region - Sunderland) - Brock Sunderland Depot
operations to be located at Region's Sunderland Depot
II No. 13 (Scugog - Port Perry) & No. 19 (Region - Scugog) - Scugog Port Perry Depot
operations to be located at Rëgion's Scugog Depot
For Decommissioninq (in near future, with staffing and equipment being redeployed):
It No.3 (Brock - Beaverton)
" No.4 (Brock - Cannington)
. No.6 (Clarington - Orono)
. No. 15 (Scugog - Island)
A methodology was developed for this business case that looked at the financial implications of
the proposed transactions in terms of:
...
e The change in capital costs and associated timing that would now be the responsibility of the
jurisdiction owning the depot, relative to those avoided by the jurisdiction that was moving;
. The on-going maintenance costs that would now be the responsibility of the Region as the
owner of the facility, relative to those avoided by the Area Municipalities; and
e The potential net proceeds from sale, rent or disposal of the decommissioned property. The
net valuation was calculated as a percentage of the current value assessment based on an
expected sale price. An 8% administration fee was also applied.
In order to develop this business case, several key assumptions were required to estimate future
cash flows. Assumptions included 20-year facility life spans for new construction, economic rents
paid by individual Area Municipalities occupying Regional facilities, the assumption that if
environmental liabilities exist, they do not represent an incremental change attributable to this
business case, and the assumption that new construction costs would be equal to construction
costs avoided by individual Area Municipalities with differences in timing of cash flows.
30
n r:: 0"
.'--'
Financial Analysis
Figure 1.7
¡ ~~:;,'::t:~7";":;"::'~~::,Y':::"~:~':""":.':'i';~Gêifêfâlirãvy;TãX';IiñpâêHõr'Depot:i.Ftàtfèfnalizãtioii..';\:"~~.'.:.-; .:':".,"::.::.;' i, '," ",:, .Y.. '.1
rt):i:::.:.:(".rt~::::~¡:~.;-::::::::.;.:;.:..>/~;:",-. ~~~";:': 'i~a'b~~!:."~""~~~~i~r:~~~:~~:~,'::':'::'::~~:::~~;,;:..~'~':~:¡R~~~i:J~~;" ,,'1:~~~~~~r~~.~~.~f~I~:~~ ':'~ :",'.~.~::,:',~;
¡ . ' " " ,,' ,'GerhÚai '-,.:",; Gêi,ofal'-.;': :,::¡'o;~I','~"<~, i, ~_~~n~.! '~!.'" : r::~rlr>.'I':>.,I.'::'::'I'-rIOI'.~,:,I:-: ',::.,
- ..--.:...-..:.--- - -'-'--' --...-,--.---- - ---,,- --- -=-....-- --=--._~:_- -, _.::-"'::._~---, .-- ,- ,','
Pickering Capital $2.37 $0.00 $2.37 0.18% 0.00% ---"Õ:Õ8%
Maintenance ($2.60) $0.00 ($2.60) -0.19% 0.00% -0.09%
Total ($0.24) $0.00 ($0.24) -0.02% 0.00% -0.01%
Ajax
Capital $2.37 ($4.44) ($2.08) 0.18% -0.49% -0.07%
Maintenance ($2.60) $1.30 ($1.30) -0.19% 0.14% -0.04%
Total ($0.24) ($3.14) ($3.38) -0.02% -0.35% -0.11%
Capital $2.37 $0.00 $2.37 0.18% 0.00% 0.08%
Maintenance ($2.60) $0.00 ($2.60) -0.19% 0.00% -0.09%
Total ($0.24) $0.00 ($0.24) -0.02% '0.00% -0.01 %
Capital' $2.37 $0.00 $2.37 0.18% 0.00% 0.07%
Maintenance ($2.60) $0.00 ($2.60) -0.19% 0.00% -0.08%
Total ($0.24) $0.00 ($0.24) -0.02% 0.00% -0.01 %
Capital $2.37 ($0.36) $2.01 0.18% -0.04% 0.07%
Maintenance ($2.60) " $0.08 ($2.52) -0.19% 0.01% -0.08%
Total ($0.24) ($0.27) ($0.51) -0.02% -0.03% -0.02%
Capital $2.37 $0.45 $2.82 0.18% 0.06'% 0.10%
Maintenance ($2.60) $0.03 ($2.57) -0.19% 0.00% -0.09%
Total ($0.24) $0.49 $0.25 -0.02% 0.07% 0.01%
Capital $2.37 $0.00 $2.37 0.18% 0.00% 0.09%
Maintenance ($2.60) $0.00 ($2.60) -0.19% 0.00% -0.09%
Total ($0.24) $0.00 ($0.24) -0.02% 0.00% -0.01 %
Capital $2.37 ($12.18) ($9.82) 0.18% -1.03% -0.29%
Maintenance ($2.60) $0.10 ($2.50) -0.19% 0.01% -0.07%
Total ($0.24) ($12.08) ($12.32) -0.02% -1.02% -0.36%
Whitby
Oshawa
Clarington
Scugog
-
Uxbridge
Brock
Capital $2.37 ($0.98) $1.39 0.18% -0.11 % 0.05%
Maintenance ($2.60) $0.21 ($2.39) -0.19% 0.02% -0.08%
Total ($0.24) ($0.77) ($1.01) -0.02% -0.09% -0.03%
<The Changes above reflect the estimated one-time change in taxes on an Average Residential Home with CVA= $ 200,000 for a 19
year net present value of cash flows, Note that actual year-by-year funding obligations may vary,
Reg Avg
The costs for the depot analysis were broken into operating and capital components. The
combined figures yield the overall impact to the Area Municipalities. At the local level, variations
occurred due to the different depot rationalization scenarios that were proposed in the Stage 1
report.
11
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Qualitative Analysis
Depot Rationalization provides an opportunity for the Region and Area Municipalities to obtain
some "quick hit" economic benefits, as the Depot Rationalization process can be implemented on
a case-by-case basis.
051
-
Depot Rationalization enhances the efficiency of the overall depot network within the Region. The
net impact of the rationalization process will be fewer facilities to maintain. As a result, associated
operational costs will be eliminated or reduced. Administration of the depots will be enhanced, as
activities will be focused on a lower number of sites.
There are several instances in which works yards are located side-by-side, across the street from
one another, or there are several yards in close proximity to one another. Rationalization of
depots should improve this perception.
Conclusions
This business case has shown that, on an overall basis, the taxpayer will benefit from the Depot
Rationalization process. It is recommended that the Depot Rationalization process be undertaken
as proposed. The benefits of pursuing this initiative, include:
.
Potential one time gains associated with facility disposal, or using the facility for another
purpose and avoiding other capital costs;
Reduction of ongoing annual facility operating costs;
Improvement in public perception relating to depots in close proximity; and
Improved resource utilization.
g¡
0
€I
-
There are several "quick hit" opportunities within the proposed depot framework as recommended
by the Stage 1 report. These opportunities are not large in magnitude; however, they provide an
opportunity to improve the overall efficiency and effectiveness of the various Public Works
functions located within Durham Region by reducing the number of depots from 22 to 15. This
effort should only be the precursor to future rationalization initiatives identified in the Stage 1
report, as well as any other opportunities that emerge in this area.
Since this business case was performed independently from the Road Network Rationalization and
Road Maintenance business cases, it is possible that some of the results as presented might
change. For example, if both the Road Network Rationalization and Road Maintenance business
cases proceed, some Area Municipalities have indicated the potential need for some depots
currently targeted for closure to remain open. However, final determination of requirements must
await detailed operational planning during implementation.
32
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ATTACHIV¡ENT#~ TO RItPORT#.Q.5 óO5~
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052 1.4.
Solid Waste Collection Business Case
-
Refer to page 63 for the detailed report.
Background
The objective of the Solid Waste Collection business case is to investigate the financial impact and
validate the qualitative benefits of consolidating service delivery of all waste management services'
at the Regional level, as proposed in the WOW Stage 1 Report. Over and abov~ the intent to
demonstrate the currently available efficiencies in a single tier system, the objective is also to
demonstrate that additional savings could be achieved in a one-tier system, as increased levels of
diversion and source stream separation are required.
The business case does not examine the standardization of other levels of service. The ability to
implement standardization and the impact on Regional waste processing 'is. not materially different
between one-tier and two-tier systems.
Approach
In an attempt to achieve a more effective and efficient service for Durham residents, the Solid
Waste business case explores several forward-looking scenarios. The scenarios are theoretical in
nature and examine the potential future impact of moving all waste management responsibilities to
a one4ier structure at the Regìonallevel, and introducing new and standardized source streams of
waste management services across the Region. The scenarios do not define the service delivery
model that would achieve the efficiencies.
Some key assumptions used in the development of this theoretical business case include an
immediate .15% saving achieved in collection costs under a one-tier structure, collection stop
growth proportionate to the percentage increase in population, and the ability of the Region to
attain diversion goals by 2b07. The 15% reduction in collection costs leads to an average cost per
stop in the Region of $37.50 which includes all costs, including yard waste and garbage collection.
In arriving at this saving, consideration was given to empirical data with respect to efficiencies in:
-
..
Co-collection of waste streams - there are additional efficiencies available under a one-tier
system because the Region will be able to supplement its existing collection of blue boxes with
other source streams;
Improved capital utilization arising from partial loads occurring less frequently; and
Purchasing efficiencies arising from volume discounts as experienced in other similarly sized
municipalities. .
.
"
33
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Financial Analysis
Refer to Figure 1.8.
The tax impacts represent the theoretical one-time savings that would be generated today from
immediate adoption of the proposal. These will not be realized immediately though, due to the
existence of several long-term contracts and should be re-evaluated as a precise implementation
pathway is developed.
n t:;.!
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-
The cost savings that result from moving to a one-tier structure are largely driven by the
economies of scale achieved in the collection of waste. By administering two or three large
collection contracts instead of eight individual contracts, the Region can expect cost savings
through more efficient capital utilization, purchasing efficiencies, and co-collection of various
materials such as recyclables, organics and garbage. The overall collection savings achieved are
estimated to be approximately 15% of the current regional total. Howevér; these savings are
estimated to occur at the regional level, which represents the weighted average of all Municipal
costs. Therefore, some Municipalities save more than others given their current contract costs for
collection and the impact collection costs have on their local general levies.
While enhancing current source streams will result in an overall cost increase to the Region, some
of these costs will be offset by downstream savings. Specifically, the costs to transfer and dispose
of waste will decrease as more garbage waste is diverted to the organics stream. For example,
excluding overhead, it costs the Region approximately $75 per tonne to transfer and dispose of
garbage waste. Alternatively, it costs the Region approximately $45 per tonne to compost
organics. With the introduction of food waste, this figure is expected to increase to approximately
$65 per tonne due to the additional cost of separating the food waste from the yard waste.
Therefore, the Region will save roughly $10 for every tonne of garbage that is diverted from
transfer and disposal to compost.
--
34
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¡~--~~:..' ",":::,,;'~,\,~::,"~:;:t>~::~;¡:.,' ,i Geñera( " .:1~,~~-"G~I!~~!~l,":_;~_ï~otal}'"':~ 'Ge"e~'::~':,.~J=.o_~J.§.~£I.'£U~"I'....;.J=çiJêl..----:
Pickering 2.84%; -5.66% I -0.03% $38.30" -$39.15 -$0.85 I
Figure 1.8
-
Ajax 2.84% -3.31% 0.26% $38.30 -$30.15 $8.15
Whitby 2.84% -4.74% -0.01 % $38.30 -$38.71 -$0.40
Oshawa 2.84% -3.94% -0.29% $38.30 -$48.13 -$9.83
Clarington Flat Rate ** N/A N/A -0.27% $40.75 , -$49.00 -$8.25
Scugog 2.84% -7.49% -0.57% $38.30 -$54.93 -$16.63
Uxbridge 2.84% -6.97% -0.09% $38.30 -$40.85 -$2.55
Brock 2.84% -5.36% -0.74% $38.30 -$63.59 -$25.29
Regional Avg 2.84% -4.04% -0.29% $38.30 -$35.80 -$9.06
"';", u""", ',,"':';','~r:,:';"";"';""""""U'-""""'-""""'""........,_..,.,~,"".~""~.,.,_..,_.~,..,,,..,~.'.","."'n","........,.";.""",.,~"¡.'.,;"",.,..","",..";.:,.""",,,,,,,~I
~-- ,T~x,I,~lIp~ic,~,~(~().~~ng:F~~~~ T~_~~~~~r ~o p~l,~..~ier~~~~~'E~,~:~ll~~d Sc~c~ ~~~=~n~5 _:~~:_:::
¡_._..~-~~-,i..~~~~~::',::."::::':;::":::: -'~~~:~'I.l}pY_~L~1~D~~:::~~~~>..I,'~' <õ'" '~;:' .., :~,,!'m~~!~~Ð~Ei~~~__~~.
!" ',""',:'..""":,,,..,:;;¡.o/lal¡_o..al," I ',.,I-«(\g...:1c., 'ILo"~,¡,.,.,,."
! """,:"" Gnnerai !G..mera¡", !Total': 'Genrm:.I¡ , ":~'mt;m!"'!olel:
----"--piëkering ---'----~3.22% ------:5.66õ¡;-O~15%-----'-"- $43.43---' "':$39.15"' "'--$4:28'
..-. Ajax 3.22% -3.31% 0.43% $43.43 -$30.15 $13.28
Whitby 3.22% -4.74% 0.16% $43.43 -$38.71 $4.73
Oshawa 3.22% -3.94% -0.14% $43.43 ~$48.13 -$4.70
Clarington Flat Rate ** N/A N/A -0.09% $46.21 -$49.00 -$2.79
,
Scugog 3.22% -7.49% -0.39% $43.43 -$54.93 -$11.50
Uxbridge 3.22% -6.97% 0.09% $43.43 ~$40.85 $2.58
Brock 3.22% -5.36% -0.59% $43.43 -$63.59 -$20.16
Regional Avg 3.22% -4.04% -0.12% $43.43 -$35.80 -$3.66
'The Changes above reflect the theoretical estimated one-time change in taxes on an Average Residential Home with CVA= $ 200,000
for a 10 year net present value of cash flows, Note that actual year-by-year funding obligations may vary, The savings as indicated are
the ultimate savings and will not be realized immediately, as contracts currently exist.
.* The overall Regional tax rate is 2.84% however Clarington collects the amount levied by the Region through a flat rate basis for
mainly residential properties,
..* This scenario excludes the capital costs required to implement enhanced source streams
35
(:;ualitaa\'f~ Analysis
Several factors were identified:
I) :; ;
'.. ,)
'it
Movement to a one-tier model will assist the Region in reaching its long term waste diversion
goal of 50% by 2007;
Customer service will be enhanced as residents only have to deal with one level of
government; and
f\ccountability will be more clearly defined as the realignment of the waste management
network will allow for improved control of all waste related services under one umbrella,
f¡
-
@
Ccmc!U5Ù:.ms
The results of this business case demonstrate that overall, the Region can save costs by flJOving
to a one-tier structure. More importantly, the Region can alsò enhance its 9urrent source streams
and still operate at a lower cost under a one-tier structure than it could by maintaining its current
two-tier structure with current source streams.
Given the highly theoretical nature of this analysis, and the present day realities that face waste
management in the Region of Durham, there are key challenges that exist with regard to the
implementation of this case. Currently, Oshawa and Whitby collect waste through theìr Area
Municìpal operations. A one-tier model will have to develop a service delivelY model that is
beneficial to all parties, yet still captures the cost savings projected in this business case. Ajax and
Pickering are currently under contract for waste collection until2006 and 2009 respectively.
We recommend that this business case be approved so that an implementation strategy can be
developed to begin resolving the issues highlighted above.
-
36
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1.5.
Enaineerina Development Approvals Business Case
-
Refer to page 77 for the detailed report.
Background
The objective of the engineering development approvals business case is to review the
engineering component of the development approvals process and investigate the concept of the
Area Municipalities taking the lead for processing engineering development applications, as
proposed in the Stage I Report.
Approach
Each Area Municipality and the Region was interviewed to determine the current process for
reviewing engineering development approvals. High-level process maps ,were developed to
describe the flow orthe activities that occur throughout the review process. The City of Oshawa
was not interviewed since it declined to participate in this study.
To supplement the interviews, an external stakeholder workshop was conducted to identify the
perceptions and issues of the development and engineering consultant community. These issues
and perceptions were used to help identify opportunities for improvement in the current process.
The results of the interviews and the workshop were used to perform an "As-Is" assessment to
highlight key issues. The liAs-Is" assessment was used to develop a liTo-Be" process map from
which key process changes were identified and assessed for financial impacts.
As Is Process Assessment
--
The major finding from the As Is Assessment is that developers and engineering consultants must
travel to multiple locations to submit drawings and must contact multiple stakeholders to ask
questions and review projèct issues. In order to address the issues of multiple locations and
multiple points of contact, a one-point-of-contact approach was developed with the Area
Municipality as the lead.
To Be Process Design
The one-point-of-contact role would be filled by a project coordinator who would facilitate the
review process and answer any questions that the engineering consultant may have. This would
not be a new position, but rather a change in responsibilities and emphasis.
The project coordinator should be a current Area Municipal employee who facilitates the
submission and feedback process with the development community. All issues and concerns
would be compiled and communicated to the project coordinator from the Region and the Area
Municipal reviews. The project coordinator would communicate the issues and comments to the
development community following the engineering review, and would review the submission on an
on-going basis, to ensure that all concerns previously identified, have been addressed.
. Since the developers' building schedules are impacted by delays in the review process, a standard
review cycle should occur with an established timeline (provided all required information is
submitted). In a similar fashion though, the development community should adopt it's own
performance standards in terms of submitting drawings early enough in the building schedule.
The development community must also set and meet standards for complete inclusion of required
information. This would help to smooth the impact of peaks in demand on review services.
-
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To rE)duce rework and overall effort, the project coordinator should meet with the engineering
consultant to review the issues and comments at the end of a submission cycle and again prior to I<I:~, ì
the detailed engineering review. This will ensure that submissions are complete and that the ,~
engineering drawing addresses the issues that have been identified by the Area Municipal and
Regional review.
Pinandal Analysis
The new process of reviewing engineering designs would not significantly affect the Area
Municipality or the Region.
Some Area Municipalities currently use engineering consultants to review drawings submissions
and would therefore use an engineering consultant to facilitate the project coordination process, as
the consultant has more knowledge of the engineering review process. In this situation, the
consultant fees are directly charged back to the developer thereby removing the financial impact
on the Area Municipality.
The process change would not financially impact the Area Municipalities or the F~egion because in
most cases an existing employee would facilitate the one-point-of-contact role. The project
J coordinator role is simply a change in responsibility with some time devoted to aiding
cormnunication between the reviewing entities and the developer. Engineering plans and
comments would be exchanged at meetings so additional courier costs would not be incurred.
The cost of travel for Regional technicians would be minor as there would be one meeting per
submission required.
If the Area Municipality is unable to satisfy the resource requirements with the current level of staff
then there may be a need to increase staff levels. In this case, there is still an opportunity to
charge the project coordinator resource costs back to the developer by reviewing the fee structure.
There should be full cost recovery for the review process based on a user pay approach. This is
an issue that will need further review in the implementation plan.
(:)ualitative Analysis
There are additional qualitative customer service issues that would be improved by the process
ctlanges as proposed.
In keeping with the one-window approach, one-point-of-contact would ensure that the developer's
questions are answered in a timely fashion. The project coordinator's role would be to facilitate
the review process and to answer any questions that the developer may have. This would allow
the developer to contact a single party to ask questions and would make that party accountable for
responding.
TIle changes, as proposed, would help to promote the culture that the Region, the Area
Municipalities and the development community are working together to achieve a common goal.
This would help to address the developers concerns that the current review process impedes their
ability to deliver their product on time.
As such, the piOcess changes result in the development community receiving better customer
sen¡Îce from the Region and the Area Municipalities.
38
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,.....
n5d
Conclusions
The review identified the required process changes to achieve a one-window approach with each
jurisdiction required to maintain responsibility and accountability for theìr respective engineering
decisions and associated financial control. The key components to these additional steps are
cornrmll1Îcation between reviewing levels and communication with the development community
through a one~point-of-contact approach.
-
Our review indicated that all process changes would have a very minor, if any, cost impact, such
that a detailed cost analysis was not deemed necessary. The process change would not
financially impact the Area Municipalities or the Region because in most cases an existing
employee would facilitate the one-point-of-contact role. The project coordinator role is simply a
change in responsibility with time devóted to aiding communication between the reviewing entities
and the development community. However, if it becomes apparent duriÇ1g, Implementation
Strategy development that some Area Municipalities might incur incremental costs, these should
be identified and quantified at that time.
The change would not be difficult to implement, as there is no change to the current engineering
review or fee collection methodology. However, if Area Municipalities require assistance in
facilitating the new process, there is an opportunity to have engineering consultants act on behalf
of the Area Municipalities or the Region to facilitate the review process.
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1.6
WEED CONTROL ACT ENFORCEMENT
EXECUTIVE SUMMARY
Enforcement of the Weed Control Act is currently a Regional responsibility.
During the Stage I Review it was seen by the WDW Committee to have potential
benefits if transferred to the local area municipal level, therefore the concept was
proposed for study during Stage TI.
This business case has identified the benefits of transferring Weed Control
Enforcement to the Area Municipal level as being largely qualitative in nature.
These qualitative benefits are reviewed in detail in section 5, however the main
benefits can be summarized as: ,
. the ability of the local municipality to detennine and direct its own level of
service
. enhanced efficiency through eÍimination of the need for the Regional Finance
Department to be involved in invoicing for cuts and processing/tracking
delinquent accounts for reimbursement through the property tax process.
. Possible public perception and customer service enhancements.
There are no significant financial benefits to transferring the weed control
function. Inspections and mowing costs are generally recovered through fees
charged to offending property owners. Total net costs to the Region are about
$20,000 annually. This is predominantly for clerical/administrative costs that are
a portion of the portfolios of two existing fulltime positions. These positions
would not be eliminated if weed control enforcement transferred to the Area
Municipal level.
In addition, when extrapolating inspection/mowing costs and recoveries (which
would transfer), the net cost savings to the Region would be $1,000, based on
2001 projections.
,WDW Conunittee Members consulted'with their respective By-Law Enforcement
colleagues and all are receptive (altJ;lOugh not overly enthusiastic) to assuming
responsibility for Weed Control Act enforc~ment. Those with lesser volumes of
weed inquiries/complaints indicated they would utilize existing internal resources
to administer the programs, while others with larger volumes of calls indicated
they would contract with the existing seasonal Weed Inspectors to investigate
inquiries and resolve complaints. It should be noted that, since Oshawa has
declined to participate in the Stage II Review, their position on this matter is not
known.
Through discussion of this business case, WDW Committee Members concluded
that, overall, there is no significant positive benefit to transferring Weed Control
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Act enforcement to the Area Municipal level as the program is culTently working
effectively and there is no material fmancial benefit to be gained by a change.
The WDW Committee therefore recommends:
THAT enforcement of the Weed Control Act remain the responsibility of the
Region of Durham to coordinate and administer.
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061
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ROAD-RELATED PERMITS
EXECUTIVE SUMMARY
During the Stage I Review, the WDW Committee saw possible benefits to
examining a "one-window" approach to receiving and processing road-related
permit applications. By this it was envisaged that an applicant could go to any
municipality within the Region to complete a standardized formes), and could also
have permits that cross municipal boundaries processed at one location.
The most common types of road-related permits are "Entrance" and "Road
Occupancy" permits (ie for access onto a municipal road from a property owner
and/or for uses such as moving over~sized loads, temporary road closures, utility
installation/maintenance (hydro/bell/cable),. and special events/filming.)
Reference Schedule A for an overview of CUlTent road-related permits and
practices.
The WDW Committee has determined that the main benefit to introducing a one-
window approach to road-related permit processing would be qualitative in nature
-- specifically, enhanced accessibility. There would be no financial benefit. In
addition, the one-window approach would be less .efficient than the present
system, as permits issued and fees collected by one municipality on behalf of
another would require public works training/coordination in other municipalities'
permit processes, and would also involve Finance Departments in the accounting
and transfer of payments. .
There are, however, a number of ways in which customer service and public'
accessibility can be' enhanced, with much less time and effort than pursuing the
one-window approach:
. The Region could provide Area Municipalities with basic information about
its road-related permits (ie processing/contact information and a supply of
forms) in the event a local applicant needs a Regional pennit, also.
. Similarly, Area Municipalities could provide the Region with basic
information about their road-related pennits in the event an applicant needs a
local permit, too.
. In the case of over-sized/over-weight load moving permits, the Ontario Good
Roads Association, in conjunction with MTO and the Ontario Truckers
Association (OT A) is currently exploring the interest and feasibility for a
computerized "one-window" province-wide system, that would provide the
necessary customer service/accessibility for truckers that the WDW
Committee sought to provide inter-municipally. This initiative should be
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supported and encouraged, and each municipality should participate in the
OGRA survey.
. Forms could be standardized and printing requirements jointly tendered, thus
also enhancing economies of scale.
. Requirements could be standardized (ie for entrance pennits, utility/other
consents, etc.), where possible.
. Fees could be reviewed with a view to standardization where
possible/feasible.
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In summary, the WDW Committee has concluded the Business Case examining
its original concept of a full-scale one-window approach to road-related
permitting, as proposed during Stage I, to be more negative than beneficial, but
that specific enhancements targeted to customer service and accessibility should
be pursued. It therefore recommends: . .
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"THAT a "one-window" approach to road-related permit processing not be
pursued;
THAT the WD W Committee facilitate introduction of customer service
enhancements to road-related permitting, as detailed above. and in the
Conclusions Section (7) of this Business Case. "
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063
VEHICLES & EQUIPMENT PURCHASING
EXECUTIVESU~Y
The Stage I Report recommended that "the feasibility of purchasing vehicles and
equipment on a co-operative tender basis be investigated further, and that a
business case be developed in consultation with the Durham Purchasing Co-
operative (municipal purchasing agents.)"
In discussion with the Durham Purchasing C.o-operative, the following
comments/suggestions to further the joint tendering effort have been detennined:
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. There is benefit to having a cooperative tender. Dealers would have one
comprehensive bid document outlining all region-wide requirements (at least
for those municipalities that have a desire to participate in the joint tender),
and it may result in more competitive pricing and interest from a wider pool of
dealers.
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Share capital budgets with Co-op members as early as possible, as this would
allow for identification of common purchases for the coming year.
. Summarize capital budgets and forecasts as they relate to vehicles, equipment
and ancillary capital purchases (similar to Schedule B, attached), as this'
provides an easy-reference "snapshot" for detennination of common
purchasing needs.
. Create a Committee of staff, knowledgeable about the vehicles/equipment
planned for purchase, to work on standardizing specifications to the extent
possible/feasible.
. Seek pre-budget approval for vehicle/equipment tenders at a common
timeframe to facilitate the joint tendering process from a timing perspective
and ensure sufficient lead-time and ability to secure the current model year for
vehicles.
In addition, the Durham Purchasing Co-operative has offered a representative to
work in conjunction with the WDW Committee to further co-operative purchasing
opportunities. .'
The WDW Committee has concluded there is merit in pursuing joint tendering of
vehicles and equipment, and appreciates the input and suggestions from the
Durham Purchasing Cooperative and welcomes their assistance. To this end, the
WDW Conunittee recommends:
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"THAT the WD W Committee facilitate the formation of a committee of public
works staff to work in consultation with the Durham Purchasing Cooperative to
effect the suggestions outlined in above and in Section 3.3."
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ANCILLARY RECOMMENDATIONS
FROM STAGE I REPORT
BACKGROUND & SUMMARY
As part of the Stage I Report, the WDW Committee made two recommendations
that did not require further study. To ensure reporting on all recommendations
emanating from the Stage I Report, these two recommendations are discussed, in
brief, below, and are respectfully submitted for formal consideration as part of the
Stage II Review.
On-going Review of Road Network and Depot Locations
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During Stage I and again throughout Stage II, the WDW Committee identified the
need and merit for a mechanism to periodically review the road network and
depot locations.
The road network would continue to evolve with growth throughout the region,
and. there would be changes in usage and traffic patterns. As was demonstrated
throughout this study, some Regional roads may become more "local" in use and
some local roads may become more "regional" in nature in terms of
interconnectivity and traffic flow across municipal boundaries. Similarly, depot
facilities will require upgrade or expansion over time, or new locations may be
required. Both the road network and depots are significant business programs of
the municipalities. As with any business program, there should be a mechanism
for periodiC review and evaluation. The WDW Committee presents a cooperative
forum for this to occur. It therefore respectfully recommends:
THAT the Public Works Officials' wnw Committee be the forum for on-going
review and rationalization of the road network and depot locations to provide a
periodic evaluation mechanism for these business programs.
1.2
. Lead on Infrastructure Projects
During the Stage I Review, the WDW Committee identified that the current
practice of collaborating with one another on construction projects involving two
jurisdictions could be further enhanced. Specifically, it was felt there were
benefits to having one party coordinate the entire capital project. The WDW
Committee agreed that the proponent/initiator of a construction project involving
another jurisdiction(s) (such as watermain replacement or road reconstruction)
should take the lead in design, construction supervision and contract
administration throughout the project. The benefits were seen to be reduced
collective stafftime and reduced timeframes for the project schedule.
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To a large èxtent this value-added practice has been implemented and has been
further discussed and refined during the Stage II Review. The WDW Committee
wishes to fonnalize this practice and respectfully recommends:
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THAT the proponent/initiator of an infrastructure project Í'tivolving more than one
municipality take the lead in the design. supervision of construction and contract
administration throughout the project. subject to agreement from Area
Municipalities.
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