Agenda of Extraordinary Council Meeting

Extraordinary Council Meeting 14 May 2019

2.1 Draft Delivery/Operational Plan 2019/20 - 2022/23

RECORD NUMBER: 2019/816

AUTHOR: Mark Burdack, Director Corporate and Commercial Services

EXECUTIVE Summary

In accordance with the Integrated Planning and Reporting requirements set out in the Local Government Act 1993, this report presents:

1 The Community Strategic Plan adopted in 2017

2 The 2019/20 Delivery Program and Operational Plan (combined) including:

a 2019/20 Draft Budget

b 2019/20 Statement of Revenue Policy

c 2019/20 Draft Fees and Charges

3 2019/20 Resourcing Strategy including:

a 2019/20 Workforce Management Plan

b 2019/20 Asset Management Strategy

c 2019/29 Long Term Financial Plan

The Annual Budget 2019/20 must be approved by the Council no later than 30 June 2019.

If approved for public exhibition by the Council, the attached drafts will be published for community feedback and response for 28 days. This is the period set out in the Act in which Councillors and the community are able to put forward new initiatives and changes to priorities.

Following exhibition, management will revise the Budget taking into account Councillor and community priorities.

Given the tight timeframes for this review, it is expected that variations may be required to the Budget after adoption to ensure there is a Budget in place on 1 July 2019. The Council has a program of quarterly variations to accommodate changes to the Budget moving forward, and it is expected that this will be used again to bring forward projects that are unable to be incorporated into the Annual Budget at 1 July 2019.

Link To Delivery/OPerational Plan

The recommendation in this report relates to the Delivery/Operational Plan strategy “17.2 Collaborate - Ensure financial stability and support efficient ongoing operation”.

Financial Implications

The proposed Delivery/Operational Plan identifies the operational and subsequent budgetary impacts arising in the delivery of the levels of service proposed.

Policy and Governance Implications

The Local Government Act 1993 requires Council to exhibit the documents for a minimum of 28 days.

It is proposed to exhibit the plans for 28 days from 15 May 2019. Following exhibition the community submissions and the draft budget documents will be brought back to a meeting on 25 June 2019.

Recommendation

That Council resolves:

1 To place the draft Delivery/Operational Plan 2019/20 – 2022/23 and draft Resourcing Strategy documents (Long Term Financial Plan, Workforce Management Plan and Asset Management Policy and Strategy) on public exhibition for a minimum of 28 days.

further considerations

The recommendation of this report has been assessed against Council’s other key risk categories and the following comments are provided:

Service Delivery

The Delivery/Operational Plan identifies levels of service for the range of Council’s operations. These levels of service are also identified as part of the Asset Management planning documents.

The Delivery/Operational Plan identifies the key services Council will deliver over the term of the Plan, and quarterly performance indicators will provide a measure of Council’s performance in achieving these objectives.

Stakeholders

The Delivery/Operational Plan identifies key agencies and other groups that are stakeholders in key Council activities. The Plan identifies the range of government agencies that provide advocacy, funding and partnerships to Council.

SUPPORTING INFORMATION

Since 2012, all NSW councils have been required to prepare a suite of documents under the Integrated Planning and Reporting (IP&R) framework outlined in the Local Government Act and its Regulations.

The Framework is outlined in the following diagram:

Source: Office Local Government

The following reproduces from the NSW Office of Local Government the requirements of the Integrated Planning and Reporting Framework:

Community Strategic Plan (Term of Council)

“The Community Strategic Plan represents the highest level of strategic planning undertaken by a local council. All other plans developed by the council as part of the Integrated Planning and Reporting framework must reflect and support the implementation of the Community Strategic Plan.

The Community Strategic Plan should identify the main priorities and aspirations of the community, providing a clear set of strategies to achieve this vision of the future. Building the Community Strategic Plan takes time and must involve a whole-of-community engagement process …

The Community Strategic Plan must be based on the social justice principles of access, equity, participation and rights. It should also address the quadruple bottom line (social, environmental, economic and civic leadership) issues. It is recommended that a council uses a multi-disciplinary team to manage and implement the integrated planning process”.

The Council approved the Community Strategic Plan in 2018 following extensive community consultation.

Delivery Program (Term of Council)

“The Delivery Program turns the strategic goals found in the Community Strategic Plan into actions. It is the point where a council makes a commitment to the Community Strategic Plan, and act upon those issues that are within its area of responsibility.

The Delivery Program is the key ‘go to’ document for the Councillors. It identifies all of the key activities the council has committed to undertake over its four-year term. All plans, projects, activities and funding allocations of the council must be directly linked to the Delivery Program”.

Operational Plan (1 year)

“The Operational Plan spells out … specific individual projects and activities that will be undertaken in the next year to achieve the commitments made in the Delivery Program.

The Operational Plan includes the Council’s detailed annual budget, along with the council’s Statement of Revenue Policy, which includes the proposed rates, fees and charges for that financial year”.

EXAMPLE OF HOW THE FRAMEWORK OPERATES

The 2018 Community Strategic Plan sets out an example of how the framework is implemented.

Community Strategic Plan 2018 Objective

Healthy and active community that is supported by sport and recreational infrastructure

Delivery Program (Action)

Identify and deliver sport and recreation facilities to service the community into the future.

Flowing from the above, the other planning documents need to reflect the projects and activities that are proposed to be undertaken by Council each year, and the flow-on impacts to the budget, staff and long term financial capacity. They also need to reflect the actual costs of meeting the legislative obligations of Councillors to deliver core services (water, sewerage, waste, development applications) and other statutory obligations (e.g. WHS, EEO, Building Standards). For example, the action in the Delivery Program may be realised as follows:

Operational Plan

E.g. Seek State and Federal grant for Community Building X.

Asset Management Plan

This project will create an asset, and the costs of maintaining, repairing and replacing the asset must be included in the Asset Management Plans once the building is completed. As this will be a future cost to the Council and the community, the costs should be included in the Long Term Financial Plan and Annual Budget to ensure the Council is not taking on liabilities that it cannot afford in the future or unfairly passing costs to a future generation.

Workforce Management Plan

The operation of the Facility will have an impact on staffing. The Workforce Management Plan must anticipate the likely skills, qualifications and experience the Council will need to operate and deliver the asset and services to be provided, including backend services such as IT, finance, building services, water and sewerage, corporate governance, audit, risk management, WHS etc. It needs to set out projected changes in technology, the employment market, staff satisfaction and other factors and the likely impact on the capacity of the Council to recruit and retain staff to deliver the project as well as ongoing core services, and propose actions to ensure the Council can demonstrate to the community that it can successfully deliver the project.

Long Term Financial Plan

The Long Term Financial Plan must include the Council’s anticipated costs in applying for funding (e.g. master planning, advocacy, legals, financial planning) and any expected Council capital co-contribution, as well as the operational costs of running the facility if approved (staff, depreciation, maintenance, asset renewal, contingencies) and any projected income to offset those costs (e.g. license for use of facilities, income from sales etc).

Draft Budget

The projected capital and operational income and expenditure for the development, construction and operation of the facility must be incorporated into the Budget for the years in which the income and expenditure is expected to accrue.

Rates, Charges and Fees

Rates, charges and fees for use of the facility may need to be incorporated in future years, and other rates and charges may need to be reviewed where expenditure is expected to exceed revenue.

PROPOSED 2019/20 APPROACH

The General Manager determined the framework for the review of the Integrated Planning and Reporting documentation.

Community Strategic Plan

As the Community Strategic Plan was approved after community consultation in 2018, and no proposals or recommendations have been made for changes at this time, it is recommended that the Plan be re-endorsed for the 2019/20 period.

Delivery Program

Minor updates have been made (e.g. CBD upgrade has included reference to FutureCity as the working title which has been deferred for one year pending a decision on grant funding).

Operational Plan

Changes to the Operational Plan have been made to reflect 2019/20 priorities (see below).

Resourcing Strategy

The documents required in the Resourcing Strategy are attached to this report.

The Resourcing Strategy must include:

· Asset Management Strategy

· Workforce Management Plan

· Long Term Financial Plan

Asset Management Strategy

The historic approach to the Asset Management Strategy is to submit this for adoption following approval of the draft delivery program and operational plan. Under the current budget framework, this influences the amount of money that may be available to fund asset management.

Long Term Financial Plan

The Long Term Financial Plan covers a ten year span as required by the Act. The Plan is re-set each year and projections regarding income and expenditure are then updated for the following ten years.

The Long Term Financial Plan is based on a series of assumptions about future income and expenditure. The following general assumptions have been recommended by Finance for inclusion in the Plan:

· Rating increase as set by NSW Government – 2.7% in 2019/20, 2.5% thereafter

· NSW Local Government Award salary increases – 2.5% in all years

· Consumer Price index increment – 1.8% in 2019/20, 2.5% thereafter

· Water charges – increase 1.8% in 2019/20, 2.5% thereafter

· Sewer charges – increase 1.8% in 2019/20, 2.5% thereafter

· Superannuation – increase as per required – 9.5% in all years

· Continuation in budgeting of the Financial Assistance Grant

Workforce Management Plan

The Workforce Management Plan is required to be a rolling four year plan. It considers workplace issues such as staff sentiment, succession planning, training, future staffing needs, the impact of technology on future staffing and capabilities, the optimal organisation of staffing to deliver services and efficiency, and the workforce profile required in order to provide input into the structure and management of the Council’s operations.

LGA COMPARISON

The Office of Local Government publishes an annual data report comparing local government authority performance on a wide range of indicators. The following chart shows the latest data on comparative expenditure by a selection of comparable regional councils on service provision (2016/17).

Overall, Orange spends more per capita than the State average on environment, community, recreational, cultural, library and public order services, and significantly below the State average on administration.

2019/20 SUMMARY

Tables in this report include the current financial year (2018/19) original budget as adopted in the current Delivery Program and Operational Plan.

2019/20 Projected Income

A summary of the major areas of income is provided below. A total income of $145.2 million is projected for the year.

Fees and charges are listed as a specific section in the attached Delivery Program and Operational Plan.

Assumptions used in projecting this income are:

1 The majority of fees and charges have been increased by 1.8 per cent in the 2019/20 year consistent with the Consumer Price Index (or CPI). CPI shows how prices change over time on a standard basket of goods and services, and is used to work out how much more things are expected to cost next financial year. Those fees that increased by an amount other than 1.8 per cent generally fall into one of the following categories:

a The fee has been set by specific statutory or legislative requirement, and Council is obliged to implement the new fee or charge

b The increased cost of providing the service or good has exceeded 1.8 per cent.

2 A 2.7 percent increase in rates that was decided by IPART for General Rates (Residential, Business, Farmland).

The 2019/2020 levy for General rates will be approximately $34.2 million.

The Council is required to set its charges for residential sewer, waste and stormwater levy at a level that will cover the cost of providing these services up to a certain level. For example, if Council wanted to provide a kerbside pick-up service, the cost of this would be added to residential charges to recover the cost.

The following is proposed:

1 residential sewer charges increase by the rate of CPI which is 1.8 per cent;

2 waste charges increase 1.8 per cent based on the CPI;

3 there is no increase in the stormwater levy as Council is charging the maximum permissible.

The levy for these combined charges will be approximately $16.8 million so the total levy in July will be about $51 million.

The overall impact of these changes on an average assessment is:

1 Residential assessments will increase by $40.03, and total rates and charges $1.34 a week (or $69.62 per annum) which is 2.98%.

2 business assessment will increase $253.71 or $4.88 per week.

Please note the above totals do not include water or non-residential sewer charges which are billed separately.

Proposed increases in water and sewer fees and charges are:

Fund	2017/18	2018/19	2019/20	2020/21	2021/22
Water	3%	3%	1.8%	2.5%	2.5%
Sewer	3%	3%	1.8%	2.5%	2.5%

In 2018/19 the Council responded to the China Sword Policy and consequent ramifications on recycling operations impacted both domestically and on a global scale by requesting assistance from the State Government to support the Orange community with interim funding and assistance via a one-off $47 million assistance package. Under the scheme, assistance was only available up to a four month period ending 31 August 2018.

The Council is continuing to support the advocacy effort of Local Government NSW to identify a sustainable long-term solution to the problem that reduces the burden on Orange ratepayers. However, in the interim, ongoing processing costs of $60.00/tonne will have to be met through a necessary increase on the domestic recycling charge. This has been reflected in the proposed 2019/20 user fees and charges.

Waste fees and charges contribute $35.3 million to the Budget to cover the cost of service delivery.

Pensioners receive a statutory reduction of $250 off their General Rates & $87.50 off both water & sewer charges. Council also offers a voluntary rebate of either ten per cent or five per cent of rates & charges. The additional voluntary rebate costs Council approximately $475,000 per annum.

Grant income in 2019/20 is budgeted to total $50.7 million. This is a projection of the total value of grants that the Council is advocating for the community.

Contributions from developers are budgeted at $4.6 million for 2019/20.

2019/20 Projected Expenditure

Total operating expenditure is $99.96 million in 2019/20 across all funds.

Major areas of expenditure in 2019/20 include:

· Employee costs - $40.6 million inclusive of a 2.5% Award based increase

· Materials and contracts - $28.9 million

· Depreciation - $18 million

Council’s operating position has been impacted by expenditure increases in some areas well above the 2.7 percent rise in the rates cap approved by IPART.

These include significant additional costs in areas such as electricity, insurance and the Council’s obligation to subsidise the staff defined benefit superannuation scheme.

Council has made significant savings in recent years through changes in insurances and phone charges, however most of these savings have been eroded due to cost increases. A major focus moving forward for the Council will be to identify new efficiency opportunities to reduce the impact of price growth above the rate cap, and cost-shifting by the State government to local communities, while accommodating growing community expectations.

The growth of the population, increasing community expectation regarding customer service delivery and the ability to interact with Council online will have a rapidly growing impact on the Councils’ long-term service delivery systems. This will impose additional costs to increase staff capabilities so they can continue to be productive as skill requirements change, improve internal coordination and update information technology and acquire new systems, if Council is to deliver services to a level expected by the community.

Population growth is also increasing development applications and infrastructure required to support new residents, requiring additional staffing to meet demand.

Under new funding frameworks introduced by State and Federal governments, the Council needs to strengthen its internal economic development capacity in order to remain competitive with other local government areas, in both metropolitan and regional areas, that are investing in building their data, economic analysis, business development and government relations capacity to support future growth plans.

The combination of these factors has resulted in a low level operating surplus in the General Fund and a moderate level of surplus in the utility funds.

Donations

The proposed donations allocations are based on the current donations policy. The major change in the program at this time will be to divide the general donations and emergent funding pools together and offer quarterly funding rounds to make the system easier for community members to access. At present applicants must submit an application in February for an event that may be held in June the following year. This tends to disadvantage smaller groups. This does not require a change to the existing policy. All donation areas over the four years in the draft Delivery/Operational Plan are shown below.

Category	2019/20	2020/21	2021/22	2022/23
General Donations	60,000	60,000	60,000	60,000
Sports Facility grants	50,000	50,000	50,000	50,000
Sports Participation program	13,900	13,900	13,900	13,900
Donation to Orange Harness Racing	20,000	20,000	20,000	20,000
Emergent funding requests	20,000	20,000	20,000	20,000

It should be noted that funding is available for regional events via the tourism services contract and council programs. The tourism services contract monies have been preserved in the budget with an allocation of $400K per annum which covers the administrative costs of Orange360, marketing

Other Expenses

The following table provides the components of other expenses, and details that the expected increase in insurance premiums and electricity charges has been partly offset by reductions in telephone charges and computer lease fees.

	Original 2018/19	Proposed 2019/20	Proposed 2020/21	Proposed 2021/22	Proposed 2022/23
Other Expenses
Telephone Charges	392,658	339,681	345,319	353,624	362,335
Insurance	889,927	909,148	948,162	988,966	1,031,641
Donations	60,000	60,000	60,000	60,000	60,000
Electricity Charges	4,127,547	4,528,521	4,630,296	4,734,388	4,840,848
Gas Charges	287,869	291,378	298,666	306,131	313,785
Mayor and Councillor Fees	279,316	284,343	291,451	298,738	306,207
Computer Leases	200,000	180,000	184,500	189,112	193,840
Regional Library Administration Fee	1,290,221	1,332,148	1,376,040	1,422,334	1,471,587
Other	112,149	114,077	128,809	119,598	122,462
Total Other Expenses	7,639,687	8,039,296	8,263,243	8,472,891	8,702,705

2019/20 Operating Position

The draft Delivery/Operational Plan proposes a surplus consolidated operating position (before capital) of $2,323,752 for 2019/20.

The operating position shows how Council proposes to expend money on items other than those classified as capital.

The distribution across the funds is as follows with the table also showing the draft operating positions in the subsequent three years of the Plan:

Operating Result (by Fund)
	2018/2019 Original	2019/2020 Proposed	2020/2021 Proposed	2021/2022 Proposed	2022/2023 Proposed
General Fund	(196,399)	(75,152)	(414,973)	(568,787)	(824,801)
Water Fund	(1,534,290)	(1,042,944)	(1,098,088)	(1,135,814)	(1,244,712)
Sewer Fund	(1,138,557)	(1,205,656)	(1,240,073)	(1,226,041)	(1,312,797)
Total (All Funds)	(2,869,246)	(2,323,752)	(2,753,134)	(2,930,642)	(3,382,310)

A positive operating position is an indicator of financial sustainability. The operating expenditure is Council’s year to year expenditure on providing services. Asset renewal and the creation of new Council assets (e.g. roads) is addressed separately.

2019/20 Capital Position

The capital budget proposes to deliver projects to a combined total of $73.2M in 2019/20. The delivery of this program is reliant on State and Federal government grant funding, so the actual value will depend on the level of support provided by the State and Federal government to the Orange community. This expenditure is distributed across the funds and the expenditure levels over the subsequent three years are also shown:

Fund	2018/19	2019/20	2020/21	2021/22	2022/23
General	$ 62,553,718	$ 59,164,170	$ 36,636,229	$ 27,349,755	$ 19,802,821
Water	$ 6,532,749	$ 7,964,116	$ 2,684,863	$ 1,634,552	$ 9,462,444
Sewer	$ 2,770,392	$ 6,037,820	$ 6,753,110	$ 3,091,860	$ 4,488,617
Consolidated	$ 71,856,859	$ 73,166,106	$ 46,074,202	$ 32,076,167	$ 33,753,882

Over the four years of the Delivery Program and Operational Plan a total capital spend of $185.1 million is proposed.

The major projects budgeted in 2019/20 are as follows. Note that some projects are subject to securing funding and some are to be delivered over a number of years:

FutureCity CBD upscale and renewal - $15.5 million (part of a 2 year $30 million project)	Moulder Park works - $93k	Icely Road Water Treatment Plant security - $50k
Civic Centre air conditioning chiller replacement - $550k	Lake Canobolas Master Plan - $135k	Lake Canobolas water reticulation - $350k ($640k in total)
Scout camp development - $1.3 million ($1.85 million in total)	Kerb and Gutter construction - $100k	Reservoir tank mixers – $100k
Gallery extension - $3.7 million ($4 million in total)	Eastern Gateway rest stop - $630k	Smart water meters - $150kc
Sir Jack Brabham Park playground, amenities and community buildings - $1.3 million	Cemetery Road extension - $250k	Suma Park Dam backup pumps - $500k
Cricket Centre of excellence – $1.8 million	Waste services - $139k	North Orange water supply strategy - $300k
Wade Park development - $2 million	Stormwater Infrastructure renewals - $70k	South Orange stage 2 - $325k
RMS Cycleway funded program - $100k	Water service renewals - $128k	Manhole renewals - $100k
Mountain Bike Trail Centre - $100k	Water mains extension/realignment program – $300k	Lake Canobolas sewer upgrade - $800k
Roads reseal and gravel program – $1 million	CBD Water mains realignment - $750k	Sewer operations shed - $150k
Roads to recovery program - $580k	Water mains renewal program - $800k	Sewerage Treatment Plan inlet works upgrade - $2.2 million ($4.3 million in total)
Southern Feeder Road - $15.1 million	Telemetry audit - $100k	South Orange – stage 2&3 sewer works - $1.3 million
Northern Distributor upgrades - $410k	Blackman’s Swamp stormwater harvest - $800k	Phillip Street DCP - $100k
NDR William Maker Drive roundabout - $5.1 million	Blackman’s Swamp rehabilitation Stage 1 - $330k	Robindale Downs sewer pump station - $150k
Expanded footpath rehabilitation program $350k	Gosling Creek dam upgrade - $900k	Sewer reconstructions renewals program - $100k
Traffic facilities - $1.7 million	Icely Road Water Treatment Plan telemetry upgrade - $30k	Sewer relining program - $700k
Villages master planning - $75k	Icely Road Water Treatment Plant land acquisition - $1.1 million	Airport Car Park - $175k
Forest Rd upgrades - $2.8 million

Key Projects and co-funding

A number of projects are included which rely on grants and co-funding. Some of these include:

· CBD 2019/20 and 2020/21

· SFR - stage 2 in 2019/20 and other stages in later years

· Art Gallery Extension 2019/20

· William Maker/NDR roundabout 2019/20

· Wade Park Cricket Centre 2019/20

· Wade Park Development 2019/20

· Conservatorium 2020/21 and 2021/22

· Canobolas Sport and Recreation (Scout Camp) 2019/20 and 2020/21

While not all projects are assured of other funding, they are included to drive greater value for leverage funding provided by Council. A summary of co-funding for 2019/20 is provided below:

Summary by Fund	Proposed 2019/2020	Grant Funding	Net Cost to Council
General	$ 59,164,170	($51,463,389)	$ 7,700,781
Water	$ 7,964,116	($3,347,740)	$ 4,616,376
Sewer	$ 6,037,820	($2,579,000)	$ 3,458,820
Total	$ 73,166,106	($57,390,129)	$ 15,775,977

Partial Funding of Grant Applications

In recent years, Council has received only partial funding of grant applications from funding authorities in some cases. This can leave Council in the difficult position of seeking more grants, which in some cases do not come to fruition and leave Council with the option of using more Council source funding to complete the project with the corollary knock-on effect to remaining funds.

2019/20 Funding Sources

Funding for the projects Council is proposing comes from Council’s own funds, grants and loans. Council has already approved in previous years the following external loans:

LOANS - PRINCIPAL OUTSTANDING AS AT 26 MARCH 2019
Cost centres	Loan No.	Institution	Loan Amount ($)	Drawn Down	Interest Rate	Term (yrs)	Principal Outstanding ($)
Anzac Park/Distributor Road	4000	NAB	7,000,000	Sep-09	4.65%	10	448,007
Airport Expansion	4001	NAB	3,000,000	Nov-12	5.48%	10	1,396,977
Southern Feeder Road/ Airport Expansion	4002	NAB	4,641,000	May-15	3.58%	10	3,096,522
Southern Suburb (LIRS Program)	4003	NAB	7,700,000	May-15	3.91%	10	5,158,391
Accelerated Roads Program	4004	NAB	3,000,000	May-16	3.24%	10	2,344,071
Regional Waste Facility	6000	ANZ	8,000,000	Nov-12	5.96%	20	6,488,526
Accelerated Roads Program 16/17	7001	CBA	2,640,000	May-17	3.25%	10	2,229 061
Accelerated Roads Program 17/18	10001	NSW Treasury	2,608,000	Jun - 18	3.26%	10	2,440,406
		TOTAL	$38,589,000	LOAN PRINCIPAL OUTSTANDING			$23,601,961

The table below provides details of internal loans utilised by Orange City Council.

Borrower (by purpose)	Lender (by purpose)	Purpose of Loan	Date of Ministerial Approval	Loan Amount ($)	Drawn Down	Interest Rate	Term (yrs)	Additional Comments	Principal Outstanding ($)
Water	Sewer	Construction of the Macquarie Pipeline	13/10/10	8,166,000	Jun-15	2%	20	Interest only over term of loan with balloon payment of principal in 2035	8,166,000
General	Sewer	Construction of 24 hour Emergency Helicopter Hangar	16/11/16	3,300,000	Jun-16	2%	24	Interest and principal	3,069,449
General	Sewer	Purchase of properties within the Orange Airport precinct	22/06/17	2,493,000	Jun-17	2%	10	Interest and principal	1,992,032
			TOTAL	$13,959,000		LOAN PRINCIPAL OUTSTANDING			$13,227,481

The funding sources for the Long Term Financial Plan anticipates additional funding required for the following purpose:

· 2018/19 $1.5 million new animal shelter

· 2019/20 $6.5 million accelerated roads program

· 2019/20 $4.2 million CBD project

· 2020/21 $4.5 million CBD project

Contingent Funding Approach and Proposed Loans

Given the number and spread of projects reliant on co-funding and Council’s contribution to the projects, along with some current exposure to partial grant funding, it is necessary to consider a probability/contingent approach to such projects.

While it would be ideal to procure all co-funded projects, it may not happen and while seeking such funding Council revenue is reserved for the projects that may or may not occur.

In this regard the draft Delivery Plan proposes loans towards a major co-funded project and coverage of some of the exposure to partial funding through loan capacity and or reserves. Additionally, should a project not eventuate which relies upon co-funding then it releases Council’s component of the project.

2019/20 Asset Renewal

The Asset Management Strategy illustrates the basis for the modelling done to maintain and improved Council’s assets. The following figure provides an indication of the total annual expenditure for all asset categories in each of the major program areas together with the backlog that is expected in any one year based on the currently available funding. Details will be provided in the Asset Management Strategy.

Once the budget is adopted the Asset Management Strategy will be updated.

Forecast Expenditure over the next 10 years is shown below:

Observations on 2019/20 planning process

The following observations are made:

1. In 2018 the Council adopted a new approach to the development and presentation of the Community Strategic Plan. The Plan is a significant improvement on previous iterations. As the Council is now at the half-way point of its term, the Council may wish to consider reviewing how the plan has performed as a strategic document, options for improving community understanding of the Plan and opportunities to separate more clearly ‘Projects’ and ‘Service Performance’ requirements.

2. The Council may wish to consider its expectations of the quarterly review process and the criteria upon which management should be reviewing projects and programs. This will ensure that any funds that are unlikely to be expended in the financial year are formally reviewed to decide if they are held over to the next financial year, or reprioritised.

3. The assumptions underpinning the LTFP should be regularly tested. The assumptions are due for review, and it is recommended that a program of annual review be implemented to ensure that assumptions remain reliable and the Councillors and the community have a clear basis to understand how new initiatives impact on long-term financial sustainability.

The Council has requested a review of the alignment of the Long Term Financial Plan and the Asset Management Plans. It is suggested that this is integrated with the proposed review of the Long Term Financial Plan.

Attachments

1 Community Strategic Plan 2018-2028 - 2019/20 update - DRAFT, D19/27651 ⇩

2 Delivery/Operational Plan 2019/23 - DRAFT, D19/27673 ⇩

3 Fees and Charges 2019-2020 - DRAFT, D19/25254 ⇩

4 Long Term Financial Plan 2019/20 to 2028/29 - DRAFT, D19/18978 ⇩

5 Workforce Management Plan Strategy 2019/23 - DRAFT, D19/26430 ⇩

6 Asset Management Policy - Strategic Policy ST007, D18/32484 ⇩

7 Asset Management Strategy 2019/20 - 2037/38 - DRAFT, D19/25876 ⇩

8 Bids from Councillors for 2019/20 financial year, D19/20185 ⇩

Extraordinary Council Meeting 14 May 2019

Attachment 3 Fees and Charges 2019-2020 - DRAFT

PDF Creator

Extraordinary Council Meeting 14 May 2019

Attachment 8 Bids from Councillors for 2019/20 financial year

EXPENDITURE INITIATIVES FROM COUNCILLORS 2019/20

(Items in Italics were not voted as a priority at the Council Budget Briefing)

Proposal	Budget Funding Required	Responsibility	Costs
NEW – REQUIRE FUNDING
Increase in Parks and Gardens Budget, Tree Maintenance and Replacement	$500,000?	Division of Community, Recreation and Cultural Services	$500,000?
Possible take-over of Ex-Services swimming pool on 10 year peppercorn lease	$500,000	Division of Community, Recreation and Cultural Services	$500,000
Possible Take up of 25% reduction in parking fines	$200,000 (subject to when and if taken up)	Division of Development Services	~$200,000
LED Light Switch Out	$3,000,0000 (Loan)	Division of Corporate and Commercial Services	-
EXISTING – REQUIRE FUNDING
10 per cent increase in parks and garden (operational) funding – Nugent Reach Mower - Kidd Maintenance – consider operating budgets or one-off items · Increase in Parks and Gardens Maintenance Budget – Nugent · Street tree replacement and maintenance - Kidd · Aquatic Centre Maintenance - Kidd · Emmaville Cottage Solar and Signage - Kidd · Footpath Repairs - Kidd · Cenotaph Maintenance - Kidd · ELF Maintenance - Kidd · Adventure Playground Maintenance and Upgrade – Kidd · Botanic Gardens Buildings – Kidd	Councillor Initiatives Fund	Division of Community, Recreation and Cultural Services	$250,000
Wet playground at existing indoor pool e.g. tipping bucket – Hamling Wave pool – Hamling Second Orange Aquatic Centre – Duffy	$25K in Budget to undertake feasibility study into various options and demand.	Division of Community, Recreation and Cultural Services	$25,000
PRELIMINARY TOTAL			$1,475,000

OTHER NON-FINANCIAL

EXISTING – DO NOT REQUIRE FUNDING/FUNDING TO BE DETERMINED PENDING FURTHER INVESTIGATION
Mobile App for Council Services – Whitten Waste Information Mobile App – Nugent	To be addressed as part of major systems upgrade and integration work commencing 2019/20.	Division of Corporate and Commercial Services
Upgrade entrance to the city/Council gateways - Kidd, Mileto	Application for grant.	Division of Community, Recreation and Cultural Services
Stop and Rest – Romano/Previtera	Application for grant	Division of Community, Recreation and Cultural Services
Solar panel investment – Nugent Increase energy production – wind, solar, waste to energy – McRae	Incorporated into Efficiency and Optimisation Program. $1M for LED light replacement placed in reserves pending finalisation of specifications by Essential Energy. Business Case for electronic water meters commenced. Business Case for Solar Rooftop commenced.	Division of Development Services
Biodegradable doggy bags – Nugent	Actioned and completed.	Division of Community, Recreation and Cultural Services
Conservatorium Bid – Turner	Application for grant progressing.	Division of Community, Recreation and Cultural Services
Amenities at Jack Brabham need upgrades including lighting - Mileto	Application for grant progressing.	Division of Community, Recreation and Cultural Services
Archery Centre – Romano	Funding approved in 2018/19 and progressing.	Division of Community, Recreation and Cultural Services
Sports hub/rectangular playing field/sport and rec precinct – Hamling	Election Commitment by Nationals, Pending outcome.	Division of Community, Recreation and Cultural Services
Expanded parking – Munro	Refer to FutureCity Program	Division of Corporate and Commercial Services
Storage for community groups e.g. MTB at Lake Canobolas – Nugent	Investigating demand. Deal with as variation pending outcome.	Division of Community, Recreation and Cultural Services
Healthy City Initiative – McRae	Refer to Health Liaison Committee.	Division of Community, Recreation and Cultural Services
Driver education area – skid pan - Mileto	Scope requirements, costs and market demand.	Division of Community, Recreation and Cultural Services
Bike education/training area for kids at former netball courts – Nugent	Refer to FutureCity Program.	Division of Community, Recreation and Cultural Services
Collective Impact initiative for Glenroi – Nugent	Scope project and define resources. Review at Budget variation.	Division of Community, Recreation and Cultural Services
Moulder Park skate park precinct - Nugent	Referred to FutureCity Program.	Division of Community, Recreation and Cultural Services
Premier sport event attraction – Hamling	Not part of current visitation strategy. Respond to opportunities as they arise.	Division of Community, Recreation and Cultural Services
Naylor Pavilion Kitchen – Kidd Upgraded toilets and showers at the showground - Munro	Application for grant.	Division of Community, Recreation and Cultural Services
Street art program – purchase, competition, bring artists to Orange – Nugent	Refer to FutureCity Program.	Division of Corporate and Commercial Services
Increased funding for Jam Orange – Nugent	Refer to application for event funding under revised guidelines.	Division of Corporate and Commercial Services
Aboriginal design (local) council uniform/tie option – Nugent	Discussions commenced with LALC.	Division of Corporate and Commercial Services
Mural project – McRae	Await Refer to FutureCity Program.	Division of Corporate and Commercial Services
Aboriginal dance theatre – Munro	Raise with LALC and determine if Indigenous community wish to pursue. Budget variation considered if required.	Division of Corporate and Commercial Services
Indigenous focussed events through Orange 360 , cultural tourism – Munro	Raise with Orange360 and LALC as part of events program. Budget variation submitted if required.	Division of Corporate and Commercial Services
Chair Lift – Lake Canobolas – Romano/Previtera	Feasibility to be examined once Mountain Bike Trail and Camp are operational to assess demand from riders and public.	Division of Community, Recreation and Cultural Services
Huntley Fettlers Cottage and Precinct – Kidd	Not currently on market. Defer.	Division of Community, Recreation and Cultural Services
Gosling Creek Reservoir North Side Camping – Romano	Policy approved on camping at Gosling by Council.	Division of Community, Recreation and Cultural Services
Lucknow Historic Precinct – Kidd Kerb and guttering Lucknow – Mileto Cobb and Co Coach Display (Museum or Lucknow) - Kidd	Application for Grants.	Division of Community, Recreation and Cultural Services
Adopt a road program by community groups for litter and vandalism clean ups - McCrae	Scope and advise on costings following finalised of Land and Property register and finalisation of a Policy. Variation if required.	Division of Community, Recreation and Cultural Services
Employ Environmental Sustainability Officer	Review once savings from energy efficiency program defined.	Division of Corporate and Commercial Services
Make Orange a refugee welcome zone – McRae	Develop an Inclusion Statement and supporting plans to promote Orange as a welcoming destination and home for new arrivals including migrants. Establish appropriate welcoming committee or migration committee to manage programs. Variation if required.	Division of Corporate and Commercial Services
Bid for Lucas Heights replacement – McRae	Primary focus of employment clusters set out in ActivateOrange incorporating 1. Life Sciences Precinct (Bloomfield) 2. Professional Services Precinct (FutureCity) 3. Retail, Hospitality Precinct (FutureCity) 4. Industrial and Freight Precinct (Leewood) 5. Sport, Recreation and Environmental Education Precinct (Lake, Mount) 6. Sports and Recreation Precinct (New Hub) 7. Arts and Culture Precinct (Civic)	Division of Corporate and Commercial Services
Make Ophir carpark free – McRae	Not supported. $70K reduction in revenue. As City grows parking fees will need to be part of demand management alongside active and public transport. Plan is to fix the current pay machines.	Division of Corporate and Commercial Services
Collaboration with Department of Education to establish conference centre in new schools south Orange? – McRae	Discussions underway with interested 3^rd party on plan for Life Sciences Precinct.	Division of Corporate and Commercial Services
Encourage aged care investment – self-contained aged care suburbs - Munro	Aged care identified as priority in Life Sciences Precinct.	Division of Corporate and Commercial Services
Invest in Function Centre e.g. WiFi – McRae	WiFi Installed.	Division of Corporate and Commercial Services
Refurbishment of Community Centre – Kidd	Refer to FutureCity Program.	Division of Corporate and Commercial Services
Acquisition and refurbishment of Crown Lands Building as a Community Centre – Kidd	Sold to OCTEC.	Division of Corporate and Commercial Services
Vivid style Youth facility at light show on Museum – Nugent	Refer to FutureCity Program.	Division of Corporate and Commercial Services
Beautify the lake and make it more family friendly – Mileto	Lake Canobolas lease finalised and operating. Camp funding secured. Aim is to generate demand to support future investment.	Division of Corporate and Commercial Services
Orange festival similar to Floriade – Munro	Consult with Orange Public School about the future of Garden Ramble and explore options.	Division of Corporate and Commercial Services
Landscape upgrade in CBD “pots hanging from poles” – Munro	Refer to FutureCity Program.	Division of Corporate and Commercial Services
Bulky Goods Pickup – Romano	Full cost of waste services must be borne by residents. Place idea on public exhibition for community feedback.	Division of Technical Services.
Purchase Electric Vehicle as Council Pool Car to demonstrate Council’s commitments – Duffy	To be purchased in 2019/20 within fleet budget for use as Council Patrol Vehicle (Hyundai Kona EV).	Division of Technical Services
Footpaths connecting Oaktree to Wentworth Golf club and wetland -Nugent	Scope and advise on costings.	Division of Development Services
Biodiversity mapping for baseline data – citizen driven – Nugent	Review	Division of Development Services
Cat controls, fines for cats on the loose, cats without a microchip impounded – Munro	Council undertakes controls within the legislative authority it is granted.	Division of Development Services
More enforcement staff for DAs and parking - McRae	Review pending fines review.	Division of Development Services

OTHER SAVINGS

SAVINGS INITIATIVES FROM COUNCILLORS
Electronic Board Papers – McRae	Trial of electronic board papers will commence in 2018/10 with volunteer councillors. Potential annual savings of $50,000 - $80,000. Further expansion to be addressed in budget variation if required.	Division of Corporate and Commercial Services
Reduce Code of Conduct costs through training – McRae	New Code of Conduct and Meeting Practice to be approved in 2018/19. Training to be rolled out to Councillors. Potential annual savings not quantifiable.	Division of Corporate and Commercial Services
Reduce expenditure on Council meals	Food Survey released. Variations to be considered by Council if required.	Division of Corporate and Commercial Services