The Budget Committee recommends to the Executive Committee that:

1.         City Council approve in-year adjustments to the 2009 Approved Capital Budget as detailed in Appendix 2 of the report (October 26, 2009) from the Deputy City Manager and Chief Financial Officer.

2.         City Council approve additional carry forward funding for 311 Customer Service Strategy and Financial Services for unspent 2008 capital projects totalling $1.835 million as detailed in Appendix 3 of the report (October 26, 2009) from the Deputy City Manager and Chief Financial Officer, in order to continue work on 2008 approved capital projects.

The purpose of this report is to provide the City of Toronto 2009 Capital Variance for the nine months ended September 30, 2009 and projected actual expenditures to December 31, 2009.  Furthermore, the report seeks Council’s approval for in-year adjustments and additional 2008 carry-forward funding.

Capital expenditures for the Nine months ended September 30, 2009 totalled $950.184million or 34.4% of the 2009 Approved Capital Budget of $2.766 billion.  Tax Supported Programs spent $688.579 million, representing 31.9% of their collective 2009 Approved Capital Budget of $2.162 billion (see Appendix 1).  City Operations spent $251.881 million or 26.2% of the 2009 Approved Capital Budget of $961.548 million; while Agencies, Boards and Commissions (ABCs) spent $436.699 million or 36.4% of their collective 2009 Approved Capital Budget of $1.2 billion.  In total, Rate Supported Programs spent $261.604 million or 43.3% of their 2009 Approved Capital Budget of $604.310 million (see Chart 1 in the report).  The under spending is primarily attributed to completion of projects under budget, delays in acquiring appropriate sites, delays in receiving funds from cost-sharing partners and the impact of labour disruption

As detailed in Appendix 1, projected actual expenditures to year-end are estimated at $1.902 billion or 68.7% of the total 2009 Approved Capital Budget of $2.766 billion.  Tax Supported Programs project a spending rate of 67.5 to year-end; while Rate Supported Programs project spending of 73.3% of their total 2009 Approved Capital Budget.

In accordance with the City’s Carry Forward Policy, this report requests Council’s approval to carry forward funds for unspent 2008 approved capital projects not previously identified and included in the 2009 Approved Capital Budget.  The additional carry forward funding request totals $1.835 million as detailed in Appendix 3.

The Budget Committee recommended to the Executive Committee that:

1.         City Council approve a reduction of $0.196 million to the net Tax-Levy Program savings presented in the “2009 Labour Disruption Costs and Savings” report (September 24, 2009) from the Deputy City Manager and Chief Financial Officer (EX35.6).

2.         City Council approve a reduction of $0.130 million to the net Toronto Water savings presented in the “2009 Labour Disruption Costs and Savings” report (September 24, 2009) from the Deputy City Manager and Chief Financial Officer (EX35.6).

3.         City Council approve an increase of $0.069 million to the net Solid Waste Management Services costs presented in the “2009 Labour Disruption Costs and Savings” report (September 24, 2009) from the Deputy City Manager and Chief Financial Officer (EX35.6).

4.         City Council approve the budget adjustments including the approved position transfers as detailed in Appendix D of the report (October 26, 2009) from the Deputy City Manager and Chief Financial Officer, to amend the 2009 Council Approved Operating Budgets between Programs with no net impact to the Tax-Levy Operating Budgets.

The purpose of this report is to provide City Council with the Operating Variance for the nine-month period ended September 30, 2009 and to request Council’s approval for amendments to the 2009 Council Approved Operating Budget with no change to the Net Operating Budget.  In addition, the report also provides final financial information with respect to costs incurred and savings realized during the 2009 labour disruption by CUPE Local 79 and TCEU Local 416.

Actual net expenditures for the nine-month period ended September 30, 2009 were under budget by $90.037 million or 3.8 per cent.  Projections to year-end indicate that the 2009 Council Approved Net Operating Budget will be under-spent by $81.292 million or 2.4 per cent.  The favourable variance projected at year-end will be largely due to significant net savings of $35.890 million arising from the 2009 labour disruption in Tax-Levy Programs and under-expenditures of $29.510 million resulting from Council’s compensation policy for management/non-union staff and ratification the 2009 Cost of Living Adjustment (COLA) increase for union staff in accordance with the Memoranda of Agreement and Settlement.  Projections also indicate that Corporate Accounts will recognize a favourable variance attributed to a one-time contribution of $20.0 million in parking revenue by the Toronto Parking Authority and stronger than forecasted rate of return in interest and investment earnings of $15.0 million.

These favourable variances, however, will be partially offset by a projected over expenditure of $16.646 million net in Operating Budgets for Agencies, Boards and Commissions (ABCs) directly due to passenger revenue shortfall in Toronto Transit Commission (TTC) and a projected over expenditure of $9.117 million net in City Operations mainly attributed to revenue losses in Toronto Building and City Planning due to the impact of the recession on the development industry.  The Deputy City Manager and Chief Financial Officer will continue working with Division Heads to explore opportunities to mitigate the impact of these revenue losses.

The Budget Committee recommended to the Executive Committee that:

1.         City Council increase the Toronto Public Health 2009 Operating Budget for one-time funding of $500.2 thousand gross and $0.0 net, that is provided by the Ministry of Health and Long-Term Care to cover the cost of implementation of the PECS Solution used to manage electronic record keeping at the planned pH1N1 mass immunization clinics.

2.         City Council confirm the authority of the Medical Officer of Health to execute the Protocol for Electronic Clinic System (PECS) License Agreement and the PECS Training and Service Agreement, between the Regional Municipality of Niagara and the City of Toronto, dated September 29, 2009.