M-T debates substantial surplus as budget deliberations begin

BY SCOTT STEPHENSON

Morris-Turnberry Council is facing a unique challenge as the municipality enters the early stages of 2023 budget deliberations: how to best make use of $1.5 million of profit resulting from the sale of development land in Belgrave in 2022. Council discussed this and other proposed budget items at a special meeting on Wednesday, Jan. 25 at 9 a.m.

 

The meeting began with a general overview from Treasurer Sean Brophy, followed by departmental presentations from Chief Building Official Kirk Livingston and Director of Public Works Mike Alcock, and included additional input from CAO/Clerk Trevor Hallam. Councillors were invited to pose questions or make comments following each presentation.

 

“Overall we’re not looking, I guess, too bad,” began Brophy. “We've got a little bit of a projected surplus for 2022.” Brophy said work on year-end entries and reconciliations was ongoing, so he did not have a specific figure available to share, but assured council it would be included in the next draft of the budget.

 

Livingston spoke next on the proposed municipal drains, building department, and property standards budgets. Livingston cited an increase in salary for the drainage superintendent and $3,900 in additional administrative costs as part of the reason for a proposed $11,360 increase to the drainage budget over last year. The salary increase, Livingston clarified, is connected to a change in rate of which council was made previously aware. Livingston said the overall budget was also increasing because of a greater-than-anticipated price tag for a four-wheeler for drainage superintendent activities, which added $4,500 to the proposed total.

 

On the revenue side, Livingston highlighted the grant from the Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) totaling $16,280. Livingston said drainage maintenance projects are funded by assessing costs back to affected landowners, as well as through provincial grants. Capital projects, Livingston noted, also assess costs back to landowners. 

Livingston continued to review the building department budget. The operational expenditures are expected to rise by $12,182 over last year due to rate increases and truck repair expenses. Livingston informed council that a department truck is due for brake repairs, which he had confirmed by Leslie Motors, but the tires should last for one more year. Livingston proposed a new reserve fund specifically for vehicle replacement. Mayor Jamie Heffer expressed general support for the idea of contributing to reserves and commended Livingston for the initiative, although credit was passed along from Livingston to Treasurer Brophy for the idea’s conception. 

 

Livingston concluded with a review of the property standards budget, saying there would be a $585 budget increase over last year to accommodate rising contractual costs with the property standards/bylaw enforcement officer. Livingston also noted that this category is a net-loss to the municipality.

 

Alcock then spoke about the public works budget, first addressing parks/cemeteries, saying not much has changed over last year. Alcock discussed the possible creation of a parks reserve fund, with nothing specifically intended for its use, by potentially contributing cash in lieu of parkland money from recent land developments. This fund, Alcock suggested, could be used for future repairs or potentially even funding a new park in the future. Heffer asked for clarification from Brophy on guidelines for spending cash in lieu of parkland funds. Brophy explained that previous in lieu money needed to be spent in order to be maintained, but new in lieu money was coming that could be used for future park repairs. In addition, the parks/cemeteries budget also includes $4,000 to repair a walkway in Kinsmen Park that was damaged.

 

Next Alcock addressed the Belgrave water system, saying the situation was mostly status-quo. Operating expenses remain static but there is an anticipated minor rate increase for hydro. The municipality’s contract with private water management company Veolia is linked with the Consumer Price Index (CPI) and will require additional funding in 2023. Revenue remains consistent because consumers are charged a flat rate by the municipality. 

 

With regards to capital expenditures, Alcock mentioned the reservoirs would soon need to be cleaned and inspected; and the work on the Jane Street well, originally slated for 2022, would be completed in 2023. Alcock confirmed the 2022 completion of work on the McCrea Street well. In addition, Alcock touted a reserve fund being built for large future projects like the eventual replacement of the Jane Street well. Alcock concluded by saying, “the Belgrave water system is in good shape.”

 

At this time, Brophy advised council to consider establishing the 2023 municipal water rate at $1,183.97, an annual increase of 84 cents. A motion was made by Councillor Sharen Zinn, seconded by Councillor Jodi Snell and passed unanimously, officially locking in the year’s rate.

 

Alcock resumed his presentation by speaking on the landfill budget. The department is expecting an increase in labour costs in 2023. Aging equipment is becoming a greater concern, causing upward pressure on maintenance costs. Alcock hopes that a dedicated reserve fund will be put towards machine replacement costs that are looming. 

 

A concrete pad will be installed to park the landfill packer for maintenance. According to Alcock, the packer currently sits on tires in the wintertime to prevent freezing and directly in mud for the rest of the year. According to Alcock, installing the concrete pad will increase the efficiency of increasingly frequent maintenance work. 

 

The department also plans to move forward with a living fence to keep litter from escaping the landfill into the community. 

Alcock indicated the department is noticing an upward trend in revenue at the Morris landfill site and is conservatively predicting a $50,000 increase for 2023. The Turnberry landfill site’s budget includes perpetual care of the site and any potential consulting studies ordered by the Ministry of the Environment, an unpredictable and infrequent prospect. 

 

The curbside pickup program is expected to have minor cost increases related to the existing contract with the Bluewater Recycling Association (BRA). Zinn asked if the contract is annual and was told the five-year agreement will expire in 2024. Alcock elucidated on the ownership structure of the BRA and highlighted benefits received by working with the organization relative to communities that do not.  

 

Alcock next addressed the roads budget with a number of proposed increases for dust control contracts, bridge washing, tree trimming and snow removal. Snow removal costs have been low this winter, but Alcock admits it is difficult to predict future needs with the majority of snow typically falling between January and March. Current stockpiles of salt and sand remain high. The cost of gravel has risen 40 per cent, so even a planned 10 per cent decrease in gravel use will only partially defray rising costs.

 

Alcock detailed two major road construction projects planned for 2023. The first is finishing the paving of Clyde Line between St. Michaels Road and Moncrieff Road. The second is resurfacing, removing and repairing the asphalt on Queen Street and Clyde Line in Bluevale. Barriers, curbs and repairs are planned for one of the two bridges on Moncrieff Road and scheduled repairs are to be done on the other.

 

The department would like to upgrade its 2009 single-feed chipper to an industry standard dual-feed model that would help tackle the backlog of dead and dying ash trees that need to be removed.

 

Alcock attributes rising insurance rates, increased benefits, current training needs and unpredictable fuel costs as reasons for the escalating roads maintenance budget, coming in $110,000 over last year. 

 

Between 2021 and 2022, fuel costs for the municipality increased by $75,000. “We have no idea where [the price of] fuel is going,” said Alcock, “and it’s such a volatile thing; such a political item.”

 

Alcock is concerned about upcoming equipment costs, such as the planned retirement of the department’s grader, which has seen increased maintenance demands as it has approached replacement age.

 

Alcock also addressed the Belgrave stormwater master plan. Much of Belgrave’s older, undersized stormwater system will need an update to hook into any new development. $30,000 from the Asset Management Reserve fund is proposed to be used toward the development and planning stage of the stormwater master plan.

 

Alcock warned council that present funding for future bridge and culvert repairs is inadequate and steady investment in reserve funding is necessary. Alcock predicts an estimated $60 million will be needed over the next 30 years for bridge and culvert maintenance and repairs.

 

Brophy resumed speaking to address the administration, policing, fire and animal control budgets. The imminent replacement of the office’s computer server will be a major expense in the administration budget. Brophy warned council that the server is nearing the end of its five-year lifespan and should be replaced before complete failure causes an office closure. Brophy also suggested doubling the $25,000 that went into the Morris-Turnberry working reserve last year for 2023. 

 

The financial deposit from the 2022 Belgrave land sale is earning over four per cent interest for Morris-Turnberry, adding general revenue to the municipal coffers. Brophy said a further discussion on how to use these funds was forthcoming in the meeting.

 

The Workplace Safety and Insurance Board (WSIB) sent the municipality a $12,000 rebate from a 2022 surplus.

Net costs for policing are down, but Brophy recommends putting extra funding into the reserve to cover future increases. An increase in contract costs is expected under the fire budget. The proposed animal control budget is also seeing a small increase.

 

The council discussed grants and donations that had been requested from the municipality. The consensus reached by council is that charitable donations are an inappropriate use of public funds, but the community is encouraged to make private donations on their own.

 

Council also discussed its recreation budget, and while funding levels will likely remain on par with previous years, council expressed concerns that potential closures of the arena in Blyth and the swimming pool in Wingham may reduce service levels, without reducing costs to Morris-Turnberry ratepayers. Council intends to revisit the issue next year after some of the uncertainty is rectified.

 

Ideas for what to do with the windfall surplus of selling development land in Belgrave in 2022 spurred a noticeably livelier discussion in the room. Heffer recognized the rare opportunity for a municipal council to decide how to spend such a large surplus. Council members made several suggestions, including topping off reserves, setting money aside for future development projects, investing the money to produce annual returns, paying off debt to remove it from future books, and/or using $30,000 to go toward the Belgrave stormwater master plan. Brophy will provide more options for consideration at a later date.

 

Brophy estimates the overall proposed increase to ratepayers in Morris-Turnberry is 6.95 per cent. After discussion amongst council, Heffer requested Brophy report back with options to bring that figure closer to five per cent. The next budget meeting will be held as part of a regular council meeting.