November 30, 2010
On Wednesday, December 1, Red Deer City Council will review The City’s 2011-2020 capital plan. The City of Red Deer will present a capital budget for 2011 totaling $87 million along with a 10 year plan.
“The 2011-2020 capital plan is designed to keep The City on track towards our long term vision while responding to the economic recovery,” said City Manager Craig Curtis. “We had to make substantial revisions to the capital plan this year with 23 projects deferred within the plan or pushed out to the year 2021, and 5 projects removed from the capital plan.”
The effect of the global recession has had a major impact on The City’s finances both directly and indirectly. Some of the challenges include lower revenue due to slower growth, lower revenue from investments, lower revenue from land sales, lower offsite levy contributions, and changes to provincial Municipal Sustainability Initiative (MSI) funding. 2011 grant funding is not known at this time, however, a further reduction is possible.
“The impact of the economic recovery continues to impact The City’s finances,” said Lorraine Poth, Director of Corporate Services. “We have seen decreased construction growth and lower returns on our investments and have aligned our capital budget to accommodate this.”
The capital plan for the next 10 years totals $1,060 million based on current projections. During budget discussions this year, Council will consider approval of both current and multi-year capital projects totaling $87 million. The largest capital project for 2011 is the multi-year Riverlands subdivision development at approximately $17,830,000 to prepare city owned lands for future development.
The 10 year capital plan projections are intended as estimated placeholders and planning tools which show future need. A project’s inclusion in the 10 year capital plan does not mean that it is going ahead, it simply means that The City is considering it, planning for it and considering financing options. The only projects approved by Council are those planned for 2011 and multi-year projects beginning in 2011 or projects in need of additional funding.
When reviewing the 2011 capital budget for approval, Council will consider the expected project costs and the cost of deferral. Council will take into account the total 10 year capital plan rather than just the 2011 capital budget to help ensure debt and other capital financing is available in the future, and that the operating budget is not unreasonably impacted by debt-servicing and increased operation costs of new facilities.
“The capital plan recommended to Council balances the need for necessary infrastructure and development projects while at the same time investing in projects that will move us closer to the vision of a sustainable, vibrant and authentic city,” said Curtis.
Capital budget review begins at 10:30 a.m. in Council Chambers, City Hall on Wednesday, December 1.
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For more information see the attached Q&A document.
For more information, please contact:
Craig Curtis Lorraine Poth
City Manager Director of Corporate Services
The City of Red Deer The City of Red Deer
403-342-8156 403-342-8737
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