Year Five to Year Ten Capital Projections (2007-2011)

The specific amounts and timing of capital projects within the 2007 to 2011 capital spending envelopes are not as predictable as the forecasts for earlier in the planning period due to uncertainties of future City priorities. Accordingly, all numbers identified for this period should be treated as illustrative rather than precise. As well, until the Official Plan and its accompanying growth plans are completed, the 2007-2011 forecast has been projected by program rather than by project (see Appendix 5.3). Estimated total spending is shown below.

7.1 Lifecycle Maintenance (2007-2011)

The lifecycle maintenance forecast has been designed to eliminate deferred maintenance and show lifecycle expenditures at recommended levels as described in Section 5. As such, spending on lifecycle maintenance is shown as increasing from $248 million in 2006 to an average of $341 million each year between 2007 and 2011 to meet these recommended levels.

Deferred maintenance on City properties, facilities and vehicles is expected to be completed by 2011. Deferred maintenance levels for transportation, and water and sewer infrastructure will be included in the long-term strategy for asset management report.

Information technology lifecycle spending levels are forecast to have reached recommended levels by 2006. Lifecycle maintenance levels for transportation, and water and sewer infrastructure are expected to reach their recommended levels by 2007.

A key requirement is the continued refinement of integrated management techniques and resulting programs to ensure appropriate rehabilitation is undertaken both for linear assets and potable water and stormwater and wastewater treatment facilities. These techniques and programs form the basis of asset management reviews now underway. Based on a straightforward value analysis, therefore, 2007-2011 values provide a realistic attempt to forecast necessary funding to meet lifecycle needs commencing in 2008.

7.2 Growth (2007-2011)

Growth requirements between 2007 and 2011 will be speculative until the City has a new Official Plan. Where and how growth will take place has not yet been determined.

The City's capital forecast assumes the new Official Plan will allow the City to promote less capital-intensive growth. Any potential savings from this approach are anticipated to accrue to the transportation envelope of funds. Notwithstanding any savings, a significant requirement is expected to exist for infrastructure to support projected urban growth. The total estimate for growth is $1.365 billion for 2007 to 2011 compared to $670 million for 2002 to 2006.

The capital forecast assumes new facilities would be provided to maintain existing per capita levels of facility space. Facilities include pools, arenas, community centres, parks, cultural facilities and libraries. Other growth-related infrastructure projects and priorities will become clearer as the growth plans are adopted by Council.

7.3 Ongoing Programs (2007-2011)

Expenditure levels for ongoing programs are expected to increase between 2007 and 2011, and new program types may be added. Spending on community-related programs is estimated to increase from $10 million in 2006 to an average of $20 million each year between 2007 and 2011. Transportation programs, such as area traffic management and intersection improvements, are expected to increase from $14 million in 2006 to $20 million each year from 2007 and 2011. Expenditures on property and facilities programs are expected to increase from $9 million to $11 million. All program increases are projected in response to anticipated community needs.

7.4 New Initiatives (2007-2011)

Tax-supported new initiatives decrease from an annual average of $48 million between 2002 and 2006 to $37 million each year between 2007 and 2011. This decrease results from completion of transition projects. Tax-supported programs include projects such as new facilities not driven by growth.

Rate-supported new initiatives will increase from $7 million in 2006 to $30 million each year between 2007 and 2011. Enhancement to the water treatment process using ultraviolet light has been identified in anticipation of more stringent requirements in the future. Also, increased capacity for aeration tanks at ROPEC has been identified. Timing of the aeration tanks may be influenced by provincial regulations. A program for biosolids volume reduction in response to community concerns is included in this period, as well.

Long-range financial planning in water, sewer and waste will continue to be influenced by new and emerging guidelines, standards and regulations. It is expected that regulatory efforts will continue to move forward to promote environmental and public health. Estimates have been included concerning both water and wastewater treatment plants and any anticipated regulatory changes. The regulatory scope, impact and timing for a number of new items of legislation, however, are not yet known. These variables, therefore, could impact long-range financial requirements.

Where it is not constrained by overriding regulations from the provincial or federal levels of government, costs can also be influenced by policy decisions of Council. Beneficial reuse of biosolids, waste diversion goals, and rural servicing options are examples of issues that may have significant cost impacts.

It is also difficult to anticipate any specific programs that may be downloaded, although experience indicates any new downloaded responsibilities will not come with appropriate revenue streams. As a result, any added responsibilities could also have significant cost impacts.

7.5 Infrastructure Standards

Infrastructure standards drive the cost of projects and the overall capital program. Standards include frequency of major repair or replacement, quality of materials, and design components (functional versus "nice-to-have"). Project estimates include contingencies that vary considerably. These contingencies can represent a significant component of project costs.

Are the City's standards too high? Are its programs too expensive? Are its program costs higher than other comparable municipalities? A review of standards, comparing them with other similar municipalities and taking into account relevant factors, would help answer these questions and assist Council to identify areas of capital program cost reductions.

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