Presentation to the CRD Core Area Liquid Waste Management Committee January 12, 2011
Agenda Item No 6 – Budget Status Report by David Langley.
$13.2 million remains in the planning and land acquisition budget. The report indicates that about $2 million per month of new expenditures should occur in 2011 on planning activities. This is a seven fold increase over the average $300,000 planning costs per month over the last four and a half years.
Senior professional staff and consultant costs can be very generously estimated at $240,000 per annum per person or $20,000 per person per month. The report proposal of $2 million per month in expenditures for ongoing planning on this project, excluding land acquisition, means 100 senior professionals working full time over the coming months at CRD taxpayer expense.
Despite this huge imposition on local taxpayers, there is no accounting of how the money will be spent. How much money on procurement documents? How much on site investigations, public engagement and “indicative designs”? How much on the 19 unjustified resource recovery studies introduced by KWL at the last CALWMC meeting? Does KWL already have a contract to proceed with those studies?
There is no assessment of the CRD share of the expected $2 million per month expenditures in 2011. The report emphasis seems to be to use up all the budget funding sources as soon as possible, including the Provincial and Federal grant contributions. Where are the regular progress reports to Committee?
Final provincial and federal grants are stated in the report as $6,666,666 in total. Many people thought that CRD was getting a 1/3 grant in this amount from each of the senior governments to support the $20 million project planning costs. It is clear that CRD is carrying a much heavier burden than most people thought.
The reported capital budget funding is $29.5 million for planning and land acquisition. The CRD operating budget allocation to the project to date is $6.1 million over and above the amount shown in the report table.
When the CRD operating budget costs are included, there is a potential spending total of $35.6 million. If the current budget surplus of $13.2 million is spent and the final grants come through as stated, CRD will carry $28.9 million or 81% of the total planning and land costs. CRD will carry 70% of the planning costs.
;)
The attached graphic shows the stated project expenditures of $22.4 million to date. With the grants received and owed ($6.7 million) deducted from the total, the net costs to CRD are at present $15.7 million ($6.7 million for land and $9.0 million for planning).
Since no additional grants are anticipated, every dollar of further spending in 2011 up to the $35.6 million budget total will have to be carried by CRD ($13.2 million). The graphic shows extra CRD expenditures on land up to the $13.0 million total for land provided in the Amendment 8 business plan. The CRD costs on further planning up to the funding limit are $6.9 million if the spending outline proceeds. Net costs to CRD will rise from $ 15.7 million at the end of 2010 to $28.9 million during 2011 – an increase of 84%.
If CALWMC simply receives this report for information this would give staff and consultants the freedom to spend whatever they want within an approximate budget limit of $2 million a month.
Committee should table this report. No new expenditures should be approved until task outlines, justifications, budgets and CRD costs are identified for all components of the proposed 2011 program to ensure that all or part of the remaining budget is used as effectively as possible.