ELORA – Centre Wellington council will be trying out a new OLG funding allocation strategy in the 2020 municipal budget.
After much discussion it was agreed OLG funds will be distributed with five per cent to arts, culture and heritage, 7% to economic development and 88% for capital projects. The capital allocation has a $2.2 million cap, with excess funds allocated to economic development.
The plan differs from a council recommendation at a June 4 budget meeting, which earmarked 60% of OLG funds to roads, 20% to other capital projects, 15% to economic development and 5% to arts, culture and heritage.
“It keeps the flexibility of being able to look at how the township portion of capital is allocated to the budget process from year to year,” said treasurer Dan Wilson.
“And council is still the ultimate approval authority in doing that through the capital budget process.”
Wilson explained the township has already received $1.31 million in the first two quarters of 2019 and estimated the annual total could reach $2.44 million to $2.55 million.
“We don’t really know what the allocation is going to be … But we are on track to receive a higher amount in 2019 than we had in previous years,” he said.
Councillor Stephen Kitras said he is concerned OLG funds are not allocated specifically to items in the township’s strategic plan, such as safe communities, mental health, youth, buying economic development land, restoring old parks and funding heritage buildings.
“I am concerned that we are deciding now, before our next budget meeting, but we haven’t incorporated any of the strategic plan costs or plans into this,” he said. “We’re deciding right now and I don’t think that’s the right way to go about it with this budget.”
Kitras suggested deferring the matter and engaging the public to see what its priorities are.
Mayor Kelly Linton disagreed and said staff presented an option that would allow the 10-year capital forecast to move ahead.
“This whole approach is completely in line with our strategic plan,” he said. “All of a sudden there is a category there that says arts, culture and heritage, which is completely consistent with making sure that we have sustainable funding (for that)…”
Noting the change to the economic development contribution, Linton said, “you have to put these broad principals in place before you get into the budget process.”
Kitras said new items presented in the strategic plan should also be included.
“What we’ve done now is … (turn) it back to the staff so there’s now this 88% and they just basically can slot it where they want it, instead of us making the policy and deciding in accordance with our strategic plan …” he said.
CAO Andy Goldie disagreed, saying staff has always clearly identified strategic plan items in the capital budget forecast, with funding from all sources, including OLG revenue.
“To say that staff are not allocating funding in the capital budget or operating budget toward council strategic initiatives is not correct,” he said.
Goldie added council was aware of the completed strategic plan at the June 4 budget meeting and none of the categories in the plan were brought up at the meeting.
“This is not about staff trying to set our priorities … this was to set some policy issues around where do we spend some of that money,” Goldie said.
Councillor Steven VanLeeuwen pointed out OLG funding is not the only source of funding with which to complete capital projects. He asked if staff thought the strategic plan could be achieved through all funding sources.
Goldie said the strategic plan isn’t going to be accomplished in the first year, but staff would be working on an implementation plan.
Councillor Ian MacRae pointed out that under the staff recommendation money from both the economic development fund and the general capital fund can be used for a variety of projects.
Linton said if council chose not to make a decision based on staff’s allocation recommendation, OLG funds would be distributed the way they always have been in the upcoming budget process.
“Through this council there was some agreement that we want to provide a little more sustainability when it comes to economic development stream; we want to create a little more sustainability when it comes to arts, culture and heritage,” Linton said. “We knew … that was something that was not getting funding and we saw initiatives and projects falling through the cracks because we didn’t have a fund.
“This is council’s way of asking staff to help us find a way to get sustainable funding in those areas.”
However, councillor Bob Foster put forward a motion to have the item deferred to September. Goldie explained deferring the item would put staff five weeks behind in the budget planning process. No members of council seconded Foster’s motion and it died.
Council passed the new OLG funding allocation and will review the policy within a year.