OTTAWA POLICE SERVICES BOARD REPORT 6

COMMISSION DE SERVICES POLICIERS D’OTTAWA - RAPPORT 6

 

 

 

TO THE COUNCIL OF THE CITY OF OTTAWA

AU CONSEIL DE LA VILLE D’OTTAWA

 

26 SEPTEMBER 2007

26 SEPTEMBRE 2007

 

 

The POLICE SERVICES BOARD met on 10 and 24 SEPTEMBER 2007 and submits the items contained in this Report for the information and/or approval of Council at its meeting of            26 SEPTEMBER 2007.

 

La COMMISSION DE SERVICES POLICIERS s’est réuni le 10 et 24 SEPTEMBRE 2007 et soumet les articles du présent rapport au Conseil pour information et/ou approbation lors de sa réunion du  26 SEPTEMBRE 2007.

 

 

Present / Présences:

 

                                                      10 Sep. 07                                     24 Sep. 07                  

Chair / président:                             H. Jensen                                        H. Jensen        

Vice Chair / vice-président:             M. McRae                                                                       

Members / Membres:                      D. Doran                                        D. Doran                   

                                                      E. El-Chantiry                                 D. Guilmet-Harris       

                                                      J. MacEwen                                    E. El-Chantiry           

                                                      B. Monette                                     J. MacEwen

                                                                                                             B. Monette                

 

 

 


INDEX

 

 

NO./NO

 

 

ITEM

 

PAGE

 

ARTICLE

 

 

Police Services Board

 

 

 

Commission de Services Policiers

 

1.

2008 OTTAWA POLICE SERVICE BUDGET DIRECTIONS AND TIMETABLE

ACS2007-CCS-PSB-0010

 

01

ORIENTATIONS ET CALENDRIER BUDGÉTAIRES 2008 DU SERVICE DE POLICE D’OTTAWA


 

1.       2008 OTTAWA POLICE SERVICE BUDGET DIRECTIONS AND TIMETABLE

 

        ORIENTATIONS ET CALENDRIER BUDGÉTAIRES 2008 DU SERVICE DE POLICE D’OTTAWA

 

 

 

BOARD RECOMMENDATION

 

That Council receive this report for information.

 

 

RECOMMANDATION DE LA COMMISSION

 

Que le Conseil prenne connaissance du présent rapport à titre d’information.

 

 

                For the information of Council

 

The Board approved the following Motions in conjunction with the report:

 

That the 2008 Budget Directions be amended to eliminate the provision for an Operational Contingency Fund, and that the issue be referred to the Board’s Finance and Audit Committee for further review prior to the submission of the 2009 Budget Directions.

 

That the Ottawa Police Services Board consider and approve the Ottawa Police 2008 Budget Timetable and Directions for an incremental increase not greater than $14.1 million net of assessment growth, equivalent to a 1.44% increase on the citywide tax bill.

 
 
                Pour la gouverne du Conseil

 

La Commission a approuvé les motions suivantes conjointement avec le rapport:

 

            Que les orientations budgétaires de 2008 soient modifiées afin d’éliminer la disposition concernant un fonds de prévoyance opérationnelle, et de référer la question au comité des finances et de la vérification de la Commission aux fins d’examen approfondi avant la soumission des orientations budgétaires de 2009.

 

Que la Commission de services policiers d’Ottawa examine et approuve, lors de la réunion du 24 septembre 2007, les orientations et le calendrier budgétaires 2008 du Service de police d’Ottawa, en faveur d’une augmentation d’échelon qui ne soit pas supérieure à 14,1 millions de dollars nets de croissance de l'assiette de l'impôt foncier, équivalant à une hausse de 1,44 pour cent de la facture d’impôts municipaux.

 

 

DOCUMENTATION

 

1.      Director of Finance and Materiel Management’s report dated 10 September 2007.

 

2.       Extract of Minute, 10 September 2007 is attached.

 

3.      Extract of Draft Minute, 24 September 2007 is attached.


 

REPORT

RAPPORT

 

DATE:

 

September 10, 2007

TO:

 

Executive Director, Ottawa Police Services Board

FROM:

 

Director and Finance and Materiel Management, Ottawa Police Service

SUBJECT:

2008 OTTAWA POLICE SERVICE BUDGET DIRECTIONS AND TIMETABLE

 

 


RECOMMENDATIONS

 

That the Ottawa Police Services Board:

 

1)   Receive and table the Ottawa Police 2008 Budget Timetable and Directions, and 2008 to 2010 Financial Framework at the meeting on 10 September 2007.

 

2)   Consider and approve the Ottawa Police 2008 Budget Timetable and Directions for an incremental increase not greater than $15.1 million net of assessment growth, equivalent to a 1.54% increase on the citywide tax bill, at the meeting on 24 September 2007.

 

3)   Forward its decision to City Council for information.

 

BACKGROUND

 

Section 39 of the Police Services Act requires the Ottawa Police Services Board to approve annual budget allocations for the Ottawa Police Service to maintain the police service and provide it with equipment and facilities.   In conjunction with the OPS Business Plan and other strategic planning documents, the annual budget enables to Board to set its priorities and provide direction to management.  It supports service levels, provides the authority to proceed with key operational projects, and confirms the necessary funding to carry out the 2008 work plan. 

 

Consideration and approval of this report provides OPS management with the funding directions and timetable for preparation of the detailed 2008 Budget to be considered and approved by the Board later this year.  A sustainable financial framework for the 2008 – 2010 term of the Board is also provided for consideration.  This framework is the logical update and amendment to the OPS Long Range Financial Plan approved by the Board in December 2006.

 

As per City Council policy implemented in 2006, the operations of the Ottawa Police Service are primarily funded by a separate municipal tax rate that is distinct from citywide operations.  This funding model provides transparency to the public of the cost of police services, and provides the OPS with the direct benefit of a proportional share of City assessment growth revenue.  For 2007, the Board approved a net spending increase for the Ottawa Police of 3.1%, which equated to a police tax rate increase of 1.7% after assessment growth was applied.  In terms of the citywide tax rate, this equated to a 0.3% increase or approximately $7.00 per year for the average urban residence.

 

The approved 2007 increase was lower than originally forecast, as documented in the Ottawa Police Service Long Rang Financial Plan (LRFP) approved by the Board in December 2006.  The LRFP recommended annual police increases equivalent to citywide tax increases of between 1.1% and 1.4% for each year of the term of the current Board in order to maintain current services, keep pace with City growth, and provide for substantial capital requirements on the short term planning horizon.

 

The Board reduced the 2007 incremental net increase through the adoption of six principles:

 

1)   Growth needs for staff were deferred

2)   Capital funding was reduced

3)   All new initiatives were deferred

4)   The annual efficiency target was doubled

5)   User fees were increased

6)   The Board accepted financial risk, including freezing of funding levels for fuel, fleet repairs, and overtime.

 

As will be reviewed in the Discussion section of this report, certain of these principles have created additional budget pressure for 2007 and beyond, and cannot be repeated.  As reviewed at the time of the 2007 Budget approval, the deferral strategy was projected to have an impact on future tax increases.  In the analysis presented with the budget the tax requirement forecasts for 2008 and 2009 were increased to deal with the deferral issues as shown in Table 1 below.

 


Table 1: Ottawa Police Forecast Increases in City Wide Taxes from 2007 Budget Approval

 


In 2007, City Council embarked on a visioning and transformation process that culminated with the City’s Long Range Financial Planning Subcommittee reviewing and recommending 2008 Budget Directions for the City as a whole.  On August 14, that Committee received an updated presentation from the Ottawa Police Services Board and Police management outlining the need for a 2008 citywide tax increase equivalent to approximately 1.6% for police services.  In a report tabled with the Corporate Services Committee on September 4, the Long Range Financial Planning Subcommittee endorsed the OPS forecast.  

 


The balance of this report provides the updated Financial Framework underlying the rationale for that requirement, and the timetable for Board consideration and approval.

 

DISCUSSION

 

Current Financial Status

 

The Ottawa Police Service amalgamated in 1995.  Since that time, there has been a progression towards financial sustainability and independence from the Regional Municipality and subsequently the amalgamated City of Ottawa.   Over most of those years, the Board has increased funding for capital replacement, and approved numerous principles to fully fund police operations and maintain service reliability in times of City growth.  The three-year Business Plans, annual budgets and forecasts, and Long Range Financial Plan updates of 2002 and 2006 have provided the guide for Board priorities and available funding scenarios.  

 

Resulting from Board approved initiatives since amalgamation, the following financial elements currently exist within the Ottawa Police Services Budget:

 

·      Operations are fully funded from sustainable revenue sources, primarily the municipal tax base.  No one-time funding sources are in use for ongoing base operational requirements

 

·      Efficiency targets have been set by the Board, and achieved.  Efficiency reviews are implemented service wide each year, and specific areas for achievement are listed prior to budget approval.  Many of these ideas grew out of the Opportunity Log exercise launched as part of the Police Program Review (PPR) in 2004.  All previously identified efficiencies to date will be achieved by end of 2007.  See Annex 1 for a listing of $5.2 million efficiencies achieved since 2004.

 

·      A User Fee policy was approved with the 2006 LRFP that will ensure the proportional cost of providing services is maintained between the citywide taxpayer and the benefiting user. 

 

·      New revenue sources have been identified and achieved.  Some of these ideas had their germination in the Opportunity Log produced for the 2004 Police Program Review.  See Annex 2 for a listing of $5.7 million new revenues achieved to date.

 

·      The police service has no capital infrastructure deficit at this time.  Sufficient funding has been approved for adequate lifecycle replacement of fleet, facilities, and IT infrastructure. 

 

·      Capital growth projects are funded from development charges and debt.   Wherever possible, the benefiting user pays, to minimize the tax rate impact.

 

2008 to 2010 Financial Framework

 

To move forward with financial sustainability and independence, five recurring elements need to be added to the Board’s proposed financial framework for the remainder of the current term. 

 

Framework Element 1:  Keeping Pace with Funding for Delivery of Quality Policing Services – 0.9%

 

As with all Police Services in Ontario, the majority of the operating budget goes directly to compensation for the labour force.  The Ottawa Police Service complement of 1,779 sworn officer and civilian full time equivalents (FTE) provide the wide range of safety and security programs through three patrol divisions on 24/7 duty, emergency operations and major events, criminal investigative services, and operational support.   With 83% of the annual operating budget dedicated to direct staffing costs, the single largest budget pressure in any year emanates from collectively bargained or arbitrated economic increases, the progression of staff through compensation and responsibility pay increments, and provisions for retirement and other benefits. In addition for 2008, the full year impact of the deferred hiring from 2007 is also a requirement.  In total, the direct staffing increase cost for 2008 is estimated at $9.4 million.

 

Beyond staffing costs, the Ottawa Police faces inflationary pressures for materials, utilities, and supplies similar to any other organization.  Such pressures are compounded in 2008 by the need to correct for the level of risk accepted by the Board with the approval of the 2007 Budget.  Most notably, fuel prices have risen beyond the budgeted 2007 price of 90 cents per litre.  The average price per litre for the year to date is approximately $1.00.  As has been reported in the 2nd Quarter Financial Status Report, should that average price be maintained, a deficit of up to $300,000 could be incurred.  Fuel price and volume forecasts will be fully reviewed prior to tabling of the 2008 estimates. 

 

The Board also accepted risk in 2007 by increasing the vacancy allowance provision by $1.0 million or 20%, and by maintaining the overtime budget at 2006 levels.  Management continues to monitor the compensation and overtime budget very closely. 

 

Beyond the potential requirement for base budget corrections emanating from 2007, inflationary increases are individually forecast for utilities, property leases, IT maintenance contracts, fleet maintenance costs, and clothing and equipment costs.  In total, the non-compensation increase to maintain existing service levels is forecast at $1.1 million.

 

Offsetting the annual budget pressures is the impact of the Board approved user fee policy and efficiencies target.  User fee increases are forecast to garner an additional $150,000 from benefiting users in 2008, and the efficiency target to be achieved is $500,000.  Full review for efficiency is ongoing across the organization, and the 2008 plan will be completed for tabling with the draft budget estimates in November.

 

The 2008 incremental net taxation increase forecast to keep pace with funding for quality policing services is approximately 0.9% citywide, net of assessment growth, as summarized in Annex 3.

 

Framework Element 2: Provide for Growth Needs – 0%

 

The growth of the City of Ottawa has a significant impact on the demand for police services.  In 2006, the Ottawa Police Service completed the Strategic Staffing Initiative (SSI).  The cornerstone of the multi-year plan was the City’s growth forecast contained in the 2004 Development Charge Study.  The annual estimate from that study was a requirement for thirty additional sworn officers per year. 

 

The Strategic Growth Initiative (SGI 2013) Project, which began in 2006, has the goal of ensuring that OPS keeps pace with growth in the areas of staff complement, divisional boundaries, buildings and other assets and infrastructure.  While the City of Ottawa growth forecast is under review, OPS has identified the need for thirty additional sworn officers to maintain existing service levels for 2008.  (The request for 30 in 2007 was reduced to 20.)

 

The Service will be undertaking a full deployment review in 2008, culminating in the development of a Strategic Deployment Plan for existing and future sworn and civilian staff.  The review is expected to garner efficiencies, not economies, and therefore no change in the projected sworn officer levels for 2008 is expected.   Civilian complement levels will be frozen in 2008 pending the outcome of the deployment review.

 

The final component required for continued delivery of quality policing service and growth is funding for initiatives contained within the Ottawa Police Service Business Plan.  These initiatives include technological advancements and community centred programs, and forecast base operating needs of $650,000 per year for each of the plans three-year horizon.  An additional $250,000 is provided for increased funding for special projects in Criminal Investigative Services.  This is step three of a four- year plan to achieve a $1.0 million base budget for recurring project needs.  No increase was provided in 2007 for this initiative.  A provision for facility leases has also been included.  This interim strategy will be used to meet the accommodation needs spurred by growth, until end-state facility solutions can be put in place.

 

In general growth needs will finance themselves through the revenue generated as the assessment base grows.  The 2008 incremental operating costs for growth of $3.0 m will be offset by the $3.2 of revenue expected from growth in the assessment base as summarized in Annex 3.

 

Element 3: Provide for Imminent Large Scale Capital Projects – 0.5%

 

As noted above, the Ottawa Police Service does not currently suffer from an infrastructure deficit.  Historically, The Board has provided adequate annual increases to capital formation funding and assets such as fleet and facilities have been adequately maintained. Table 3 demonstrates this support.  Over 70% of OPS capital spending is for renewal of existing assets.  As such, the available funding sources (76% of the total) are focussed on tax supported capital contributions, or “pay-as-you-go”. 

 

Table 2:  10 Year Capital Needs Summary and Funding ($Millions)

 

 

 

Funding

Category

Gross Need

Tax

Revenue

DC

Debt

 

 

 

 

 

 

Renewal of Assets

137.3

133.7

3.6

 

 

 

 

 

 

 

 

Growth

33.3

 

 

19.1

14.2

 

 

 

 

 

 

Strategic Initiatives

25.2

15.6

 

 

9.6

 

 

 

 

 

 

TOTAL

195.8

149.3

3.6

19.1

23.8

 

 


There are several key operational infrastructure needs that require replacement in the 2008 to 2010 horizon. 

 

 

Furthermore, the debt-servicing cost for the non-development charge portion of the new West Divisional Building will begin in the same timeframe. 

 

These needs have been forecast in this timeframe for several years, including with the LRFP approved in December 2006.   The LRFP also recommended a plan for steady increases in the OPS capital formation envelope, both contributions to capital and debt servicing, to prepare for the imminent needs.  The 2007 Budget did not proceed with the LRFP plan. Capital funding was reduced $2.3 million.  

 

Table 3: Capital Formation Cost Forecast

 


As a result capital formation costs are required to increase $5.0 million by 2009 at the latest, equivalent to a 0.5% citywide tax increase as summarized in Annex 3. 

 


Element 4:  Build an Operational Contingency Fund – 0.1%

 

The Ottawa Police Service faces operational and financial pressures, many of which are unforeseen in nature.  The Board is kept informed of these pressures through quarterly status reports, but funding options and flexibility is limited.  Deficits are often the result and/or the City of Ottawa is approached to assist with funding shortfalls.  A 2007 example is the safety and security operations for the NHL playoffs.  Recurring costs are incurred each year as a result of the over 350 events that are unique to policing the nation’s capital.   The most significant of major crime investigations can also push resources beyond the available funding envelope.  

 

The events do not all occur individually each year, but in aggregate some combination of such pressures is experienced.  It is recommended that the Ottawa Police Service establish a $1.0 million operating base contingency for such events.  If approved for 2008, Board policy will be crafted for the approval and reporting on uses of the funds, as well as the retention of annual allocations should a surplus be achieved in any given year.  This constitutes the final step towards financial sustainability and independence.

 

The $1.0 million fund equates to a 0.1% increase on the citywide tax bill in 2008, as summarized in Annex 3.

 

Element 5: Seek Out New Funding Sources

 

The final element of the OPS Financial Framework is a reiteration of previous Board practice for reducing the cost of police services to the Ottawa taxpayers.  As document in Annex 2, several significant new funding sources have been confirmed in the past several years, and that effort will continue.

 

Specifically, the Federal government has been approached to assist with base operational funding for the additional costs incurred in Ottawa for being the nations capital.  Provincial grant programs will also be explored and confirmed for continuation.  As per the Board approved User Fee policy, the proportional cost of the service to the benefiting user will be maintained to avoid additional cost to the general taxpayer.

 

No new revenue from the upper levels of government will be included in the 2008 budget estimates until confirmed.  Any success in securing such funding for 2008 will directly reduce the incremental forecast tax increase requirement for 2009.

 

2008 to 2010 Financial Framework Summary

 

A preliminary term of Board forecast is summarized in Table 4.  The recommended increase for 2008 totals $15.1 million net of assessment growth, or 1.54% on the citywide tax bill.   With the capital funding levels and operational contingencies provided at that level in 2008, the remaining years in the forecast can be limited to 1.0% on the citywide bill to ensure delivery of quality policing services and to provide for growth.  

 

Table 3:  Term of Board Operating Forecast - Preliminary

 

 

2008

2009

2010

Incremental Requirement

($000)

($000)

($000)

 

 

 

 

Ensuring Quality Policing

9,250

9,550

10,050

Growth and Business Plan Priorities

3,050

3,600

3,650

Capital Formation

5,000

0

(1,250)

Contingency Planning

1,000

0

0

Less Assessment Growth at 2%

(3,200)

(3,200)

(3,200)

 

 

 

 

Net Taxation Increase Requirement

15,100

9,950

9,250

 

 

 

 

Police Tax Rate Increase Forecast

9.40%

5.70%

5.00%

 

 

 

 

City Tax Rate Increase Forecast

1.54%

1.00%

0.91%

 
 
Table 4:  Term of Board Citywide Tax Increase Forecast as per 2008 Budget Directions


 

 

 


Financial Policy Considerations

 

Subject to approval of the 2008 Budget Directions, the Board’s Finance and Audit Committee will work closely with OPS management and the City Treasurer to develop financial policy to ensure the goals of financial sustainability and independence are attainable.  Such policy deliberation can include:

 

 

 

 

 

All policy considerations will be supplied for Board approval with the tabling of the 2008 Budget.

 

2008 Budget Schedule

 

The schedule below provides the key dates for the Board’s 2008 budget directions, public consultation, and budget consideration and approval.  The equivalent City Council dates are also provided for information.  Internal OPS management review, policy discussion, and final budget preparation will occur through October.

 

Table 5:  Ottawa Police Service Budget Review and Approval Timetable

 

Milestone

Date

OPS Board: Tabling of 2008 Budget Directions

September 10, 2007

OPS Board:  Public Delegations and Approval of 2008 Budget Directions

September 24, 2007

City Council:  Receipt of OPS 2008 Budget Directions

September 26, 2007

OPS Board:  Public Delegations on 2008 Budget

October 22, 2007

OPS Board and City Council:  Tabling of Draft 2008 Budget

November 14, 2007

Public Consultation

November 15 – 23

OPS Board: Public Delegations and Approval of 2008 Budget

November 26, 2007

City Council Committee of the Whole: Approval of 2008 Budget

December 10 to 14, 2007

 

 

CONSULTATION

 

Public consultation is an integral part of the Board’s annual budget process.  As noted in the 2008 budget timetable above, public delegations are welcome at the September 24 meeting when the Board considers the 2008 Budget Directions, and at the Board’s regular meeting on October 22.

 

Once the draft budget proposal is tabled in November, staff will hold public consultation sessions in key areas of the City.  The City’s consultation process will also provide an opportunity to garner public input on the 2008 proposals.  Public delegations are welcome at the November 26 meeting as part of the Board’s consideration and approval of the 2008 Budget.

 

 

FINANCIAL IMPLICATIONS

 

The financial implications are detailed in the body of the report.

 

CONCLUSION

 

As is the case with all police services in Ontario, the Ottawa Police Service operating budget is driven by staffing costs, and to a lesser degree providing for service growth and capital replacement.  With the consideration and approval of this report, the Ottawa Police Services Board provides direction for the 2008 Operating Budget and a three-year financial framework.  If approved, these directions will constitute a 2008 citywide tax impact of not greater than 1.54%, and forecast increases of 1.0% or less for both 2009 and 2010. 

 

This framework will also enable financial sustainability and flexibility for the Ottawa Police.  Financial Policy will be reviewed and updated for approval with the 2008 Budget in December.  

 

Geoff Simpson

Director of Finance and Materiel Management

 

Debra Frazer

Director General

 

Vernon White

Chief


ANNEX 1

 

 

 

 

 

 

 

 

Ottawa Police Service Efficiency Achievements

 

 

 

 

 

 

Item

 

 

$ Amount (000’s)

 

 

Year Introduced

Complement and deployment opportunities

$1,523

2004

10 %-20% Police Program Review reductions

$1,200

2004

Court overtime

$696

2005

Community Police Centre consolidation

$422

2005

Reductions in procurement for materials, services, & supplies

$465

2005

Other efficiencies & Recoveries

$892

2004 - 2007

 

 

 

Total

$5,198

 

 


ANNEX 2

 

 

 

 

 

 

 

 

Ottawa Police Service

New Revenue Achievements

 

 

 

 

 

 

Item

 

 

$ Amount (000’s)

 

 

 Year Introduced

Provincial funding - "SCOOP"

$3,325 

2006

False Alarm By-law

$1,260

1997

Community Partnership Program

$960

1995

Crime free multi-housing background checks

$150

2003

 

 

 

Total

$5,695

 

 

 

 


ANNEX 3

 

 

 

 

Ottawa Police Service 2008 Budget Pressures Summary

 

 

 

 

 

 

 

 

 

Police Tax

Citywide

Average

 

 

2008

Rate

Tax rate

Residence *

 

 

($000)

%

%

$

Delivery of Quality Policing Services

 

 

 

 

 

Compensation Costs

8,800

 

 

 

 

Includes estimated economic increases, increments, responsibility pay, and provisions for benefits

 

 

 

 

 

 

 

 

 

 

Base Materials and Supplies

1,100

 

 

 

 

Offset by:  User Fee Policy

(150)

 

 

 

 

Offset by:  Efficiency Target

(500)

 

 

 

 

 

9,250

 

 

 

Growth

 

 

 

 

 

30 Sworn Officers Hired Fall 2008

850

 

 

 

 

Full Year Impact of Previous Years Hiring

700

 

 

 

 

Business Plan Initiatives

900

 

 

 

 

Facility Leases

600

 

 

 

 

 

3,050

 

 

 

Less:  Assessment Growth assumed 2%

(3,200)

 

 

 

Net Tax Increase Requirement

9,100

5.7%

0.93%

$23.00

 

 

 

 

 

 

Capital Formation Costs

5,000

3.1%

0.51%

$13.00

 

 

 

 

 

 

Contingency Fund

1,000

0.6%

0.10%

$2.50

 

 

 

 

 

 

Total

15,100

9.4%

1.54%

$38.50

 

 

 

* Average urban residence assessed at $276,000

 

 


1.   2008 OTTAWA POLICE SERVICE BUDGET DIRECTIONS AND TIMETABLE

      Presentation by the Director General and the Director of Finance and Materiel Management

      Documents tabled at the meeting

 

 

Chief White introduced Director General D. Frazer and Mr. G. Simpson, Director of Finance and Materiel Management.  The presentation would include reviewing the budget directions and timetable as well as the 2009 – 2010 financial framework recommendations.  (A copy of the presentation is on file with the Board’s Executive Director.)

 

Following the presentation staff was commended for all the work that went into their excellent presentation.  A discussion ensued and the following points of clarification were made:

·           Vice Chair McRae advised Board members that after having spoken with the Chief and the Mayor she was prepared to move a motion that would reduce the contingency fund to $250,000.  She recognized a contingency fund was necessary; however, by reducing it the citywide tax rate could be brought down to 1.465%.  She didn’t believe this reduction would impact the safety of residents.

·           Chief White explained that the plan for 2008 was to hire 15 new civilians, positions that have been satisfied as a necessity.  The current ratio of civilians to sworn is 1:2.  At the City’s Long Range Financial Plan (LRFP) meeting there was a discussion about the utilization of civilians within the organization and whether or not opportunities were fully utilized within the City.  The OPS feels it would be strategically sensible to look at the deployment of civilians during the next strategic deployment planning session, which is scheduled to run from late September to mid 2008.  At the end of the review staff will be in a better position to speak to the ratio and the new growth.

·           Reference was made to Councillor Dean’s motion at City Council that it “request it’s representatives on the Police Services Board to implement City Council’s position” about reducing administrative costs and “that City Council endorse the merger of administrative services related to the Police administrative functions.”  Member McRae undertook to bring this to the Board’s attention and asked what the procedure would be to implement the motion.

·           A review of administrative positions within the Police Service has been done on at least two occasions since amalgamation.  The reports are available and can be shared with Board members and City Council.  The scheduled strategic deployment plan will review the areas where the OPS could possibly utilize City resources either pro bono or at a reduced rate and determine whether or not there is a duplication of services.

·           The deployment review will look at the right people in the right place doing the right things.  Some challenges include having the right number of people on patrol versus neighbourhood officers and specialized units.  The review will deal with being more efficient and providing a better level of service delivery than it does economies.  An increased level of service may be seen in a certain area based on demand. It is not realistic to put a dollar amount on the deployment review, as there may not be any economies. 

·           Vice Chair McRae indicated she has heard comments from several members of Council that they would like the opportunity to meet with the Chief and Ms. Frazer to discuss the budget in a forum other than the Police Services Board meetings.  As this is an operational matter the Vice Chair left the matter with Chief White.  The Chief had no concerns about these meetings so long as it was understood that this is the Board’s budget and Board members may wish to participate.  He noted he has made an offer to every councillor that he is available to meet with him or her either personally or in a semi public form to discuss any issues related to policing. 

·           There was no cost attached to the “New Divisional Buildings West & South” on page 8 of the slides because of debt servicing costs.  The costs already approved by the Board for the new West Division building are $12.1 million for land acquisition and construction.  In 2007, $2 million was approved for the south division building specifically for land acquisition.  The forecast of $10 million for design and construction is to be added to the 2009 budget as forecasted in 2007.  These figures will be available when budget debates begin.

·           Ms. Frazer advised the Board there will be a presentation in October or November that will provide a detailed analysis of the factors that come into play from operational, real estate and development option perspectives to identify the proposals to develop the west division first.  Statistics show that approximately 70% of growth is in place and is being handled out of Abbeyhill (West) and Greenbank (South) stations.  Deployment from Greenbank is currently very difficult given the way transportation routes have developed.  The situation is different for the south as they are still able to handle calls for service from Greenbank.

·           The Police Tax Increase of 9.40%, as shown on page 4 of the slides, compares favorably with the Big 12 police services in Ontario. 

·           A significant portion, 63%, of the West Division building will be funded through development charges.  A smaller portion will be funded by other debt.  This also involves the consolidation of two buildings Greenbank and Abbeyhill.

·           Chief White met with the Minister of Public Safety, Stockwell Day, last week to specifically discuss Ottawa’s unique position and the possibility of receiving direct or indirect financial support through the funding of resource officers.  The Chief suggested that Ottawa be in line with funding arrangements similar to the United States and Scotland.  The formal proposal contained the percentage of the budget that could be appropriately funded, or a percentage of the 2,500 officers that could be allocated to the City and be partially funded by the Federal Government.  Mayor O’Brien also attended the meeting and made a plea for assistance on behalf of the City.

·           Chief White explained that the request to the Federal Government is more than contingency funding; it is for direct line funding.  The vast majority of events that require the OPS’ participation would not fit within the exigent circumstance required by City Council.  Secondly, at year-end, either a cheque or a bill is presented to the City depending if the year closes out in a deficit or surplus.  The contingency fund would allow the OPS to sustain such exigent circumstances, such as the NHL playoffs or increased homicides, without having to turn to City Council for more funding.

·           Subject to the approval of the budget directions, a discussion will have to be had to determine what level of reserve fund balance should be kept.

·           Councillor El-Chantiry indicated he would not be supporting any funding for the proposed motion on the contingency fund.  He would, however, support staff’s direction and the financial policy considerations as a best practice.

·           Annex 1 of the report provides the Board with an idea of where efficiencies have been achieved since 2004.  The total amount was not fully achieved by one specific review in 2004, but categorized over a four-year budget period. 

·           Fuel costs are currently 10 cents over the budgeted number for 2007.  Should this increase continue through to year-end, there could be a possible $270,000 to $300,000 pressure.  An analysis has not been completed yet for the 2008 budget. 

·           A report by the Auditor General pertaining to efficiencies within the City and Police fleets has not yet been completed.  The versions of the report seen to date have given staff some ideas of areas where savings could be achieved, such as a review of fuel cards and other ways of negotiating fuel changes.  The Director General does not think the report will be completed in time for budget considerations; therefore, staff will be using high level results.  The delay in the completion of the report is due to additional requests for information by the Auditor General and the consultant as they continue to build on the preliminary report. 

·           The budget directions as presented include an efficiency target of $.5 million.  In the past the Board has increased the figure and staff have done their best to achieve the targets set.

·           The spike projected for 2008 is not forecast again as capital formation costs will be gradually increased. 

·           Councillor Monette stated he would not support a $0 contingency fund, but would support the $250,000 plan suggested by the Vice Chair.

·           From an operational perspective, the contingency fund as presented would have allowed staff to cover off about half of the year’s exigent circumstances.  Building a strong framework around the use of the contingency fund is as important as having one.  The contingency fund is specifically for events that will not be covered by federal funding.  The intent of the contingency fund is that it be added to the operating budget base once in 2008 and incrementally thereafter.  The funds would be available on a go forward basis and subject to the policy approval would be reported to the Board if and when used in any given year.  The reserve fund is currently available primarily and only for capital requirements. 

·           Member MacEwen voiced his support for a contingency fund and does not want to see the budget process delayed due to the ongoing discussions and motions.  Member Doran echoed the comments.

 

Chair Jensen indicated he would also be supportive of the contingency fund.  He felt that over time the appropriate levels could be determined and the amount could then be increased.

 

At this time Vice Chair McRae moved her motion, however, Member El-Chantiry wished to move an amendment to bring the contingency fund balance to zero.  Chair Jensen sought legal advice with respect to the appropriateness of the first motion and the proposed amendment. 

 

Mr. D. White, Solicitor, stated that the matter before the Board today is to have the budget directions and timetable presented and tabled for consideration and approval at the 24 September meeting.  Section 20 of the Board’s Procedural By-Law No. 2 of 2001 states “A motion to lay on the table is debatable but cannot be amended.”  Therefore, it would be appropriate to take this as a notice of motion for consideration and discussion when the matter comes back to the Board for its approval at the 24 September 2007 meeting. 

 

That the Ottawa Police Services Board receive and table the Ottawa Police 2008 Budget Directions and 2008 to 2010 Financial Framework at its meeting on 10 September 2007.

 

                                                                                                            CARRIED

 

NOTICE OF MOTION (FOR CONSIDERATION AT SUBSEQUENT MEETING)

 

Moved by M. McRae

 

That the Ottawa Police Services Board reduce the operational contingency fund from $1 million to $250,000 for the 2008 budget, thereby reducing the citywide tax increase by .075% to 1.465% citywide.

 

 


2.      2008 OTTAWA POLICE SERVICE BUDGET DIRECTIONS AND TIMETABLE

Presentation by the Director General and the Director of Finance and Materiel Management

Director of Finance & Materiel Management’s report dated 10 September 2007

 

 

Ms. D. Frazer explained that the purpose of the evening’s presentation was to clarify the rationale for the $1 million contingency fund and the Board’s role in the usage of the account.  During the presentation Mr. G. Simpson, Director of Finance & Materiel Management, reviewed the rationale, recommendations and the financial policy considerations surrounding the Contingency Fund. (A copy of the presentation is on file with the Board’s Executive Director.) 

 

Chair Jensen referred to the slide that provided seven years of historical data for unforeseen events and the corresponding financial impact, and said if this was a precedent then a sizeable contingency fund would be required.  In theory he felt this to be a good idea, however, establishing such a fund would involve a great deal of risk.  He thought Board members should bear this in mind when considering the issue.

 

Member El-Chantiry agreed with the Chair’s comments.  He noted that in the past, the City has paid off any OPS year-end deficits and surpluses have also gone to the City.  He felt that from an operational perspective the current process should continue, as it is impossible to predict and plan for unforeseen events.  For these reasons Member El Chantiry proposed the following motion: 

 

That the 2008 Budget Directions be amended to eliminate the provision for an Operational Contingency Fund, and that the issue be referred to the Board’s Finance and Audit Committee for further review prior to the submission of the 2009 Budget Directions.

 

Member Monette noted that while he had originally suggested the idea of a contingency fund, he was prepared to support the motion as it would allow for a more in depth study of a contingency fund.

 

The Board then dealt with the motions that were before them. 

 

That the 2008 Budget Directions be amended to eliminate the provision for an Operational Contingency Fund, and that the issue be referred to the Board’s Finance and Audit Committee for further review prior to the submission of the 2009 Budget Directions.

 

                                                                                                 CARRIED

 

 

That the Ottawa Police Services Board:

 

4)      Consider and approve the Ottawa Police 2008 Budget Timetable and Directions for an incremental increase not greater than $14.1 million net of assessment growth, equivalent to a 1.44% increase on the citywide tax bill.

 

                                                                                                CARRIED as amended

 

5)      Forward its decision to City Council for information.

 

CARRIED