Monthly Archives: August 2012

The Budget Olympics Begin

29 Wednesday Aug 2012

Posted by in Budget/Financial, Parry Sound, Town Council

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Last night’s meeting provided an interesting preview to what we can expect with the development of the 2013 budget. The actual discussion was a bit of a surprise based on the last council meeting. What I thought was going to be a discussion of the budget review process actually was a first look at expense items that had been identified as potential areas for budget savings. Revenue items were also up for discussion but time ran out. I’m sure they will be picked up a subsequent meeting.

I won’t go through the decisions reached, they were for the most part rather trivial and avoided anything approaching a tough decision. Rather I’ll offer some thoughts about the process from my seat in the peanut gallery. (By the way there are lots of empty seats up here.)

Councillors, please, please, please remove the word ‘creative’ from your vocabulary when directing staff. Too many times last night when a budget issue arose that might have benefited from a tough decision, council looked to staff and asked them to be ‘creative’ in finding a solution. Oh, and at the same time, why not ask staff to take a ‘creative’ look at transmuting lead into gold. Better yet, let’s turn rock into gold.

Too much of the discussion was spent on looking at options that might yield budget savings in the years to come, not 2013 and 2014. This is important to consider but once again distracts council’s focus from the 2013 and 2014 budget challenges. But I’ll give council a pass on this one, last night’s meeting from what I could tell was only a ‘warm up’ session.

In terms of the staff work in preparation for the meeting I feel the discussion would have benefited from some ‘ballpark’ figures for the amount of savings involved with some of the suggestions. A thousand here and a thousand there imply that council will need to find 900 ‘heres and theres’ to close the budget gap. The focus needs to be on the tens of thousands opportunities. Putting at least an order of magnitude on most of the items would have helped focus the discussion.

Staff certainly didn’t suggest any significant cuts in their own operations. There were a couple of delayed hirings offered, as well as opportunities to reduce overtime salary costs, but no realignment suggestions (involving staff cuts) were on the list. This may of course be an issue for a closed council meeting, but it is something that will need to be considered.

Last night’s meting provided no suggestion that we will see council win gold, silver or bronze in the budget marathon. But it’s early and I’m really happy to see that training has already started. Starting in September council needs to meet at least twice monthly to wrap their head around the many budget items, trade offs and tough decisions that will be required.

One last thought: there needs to be leadership. Unfortunately Ontario’s mayor and council system limits this, but an answer must be found. Too often one councilor heads off in a direction and to avoid conflict a majority of the other councillors follow even though their expression and body language suggests they really aren’t in agreement. It’s nice to see the teamwork, but without occasional disagreement and leadership the only solution we will see are last minute desperation budget cuts or a hefty tax rate increase. Perhaps the town’s citizen finance committee has a role to play in pushing council and staff to consider some politically tough decisions.

Local/Regional Property Crime and Vandalism

26 Sunday Aug 2012

Posted by in Parry Sound, Reflections, Suggestions

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There are recent reports that the rate of property crime in Parry Sound has increased significantly relative to 2011, about 60%. Year-to-date there have been 95 break-ins in versus 60 last year. This is a big increase, but we need to better understand what these numbers relate to. It’s not easy to understand if these figures are for the Town of Parry Sound or the District of West Parry Sound. I assume it is the latter but I’ll see if the local OPP office will provide more clarification on this. Looking at a half-dozen regional news reports of the figures it’s not clear exactly what they refer to.

If they refer to the Town of Parry Sound, and we extrapolate the numbers we would be looking at about 150 to 200 break-ins for the full year. With about 3,000 residences in town it would suggest about 1 in 20 homes will be vandalized this year. This is an unrealistically high number, so the property crime figures probably apply to the District of Parry Sound. If it is I’d like to see the news outlets appropriately qualify their news stories, it’s too easy for them to pick up news on the wire, reword it slightly and never look at what it really implies and applies to.

The general regional increase is not a surprise if you have been ‘flower watching’ this summer. For the last couple of summers the Town of Parry Sound has planted petunias in the flower boxes on the Bowes Street bridge. Perhaps you have noted how this year, much more than last, flowers from these boxes have been torn out on a too regular basis. This is vandalism and petty crime that makes little sense but may be an indicator of a more systemic problem. One year of increased ‘flower pulling’ doesn’t define a breakdown in the local social fabric, nor does one year of increased district property crimes.

If you have been exposed to the ‘Broken Windows Theory‘ you can see where I am headed. The theory suggests two concepts: proactively dealing with petty crime (graffiti, littering) can reduce the incidence of more serious crime, and quickly dealing with petty crime can prevent it from continuing or becoming a ‘habit’. For example, removing graffiti quickly generally reduces its proliferation, and keeping a street litter free results in less littering. The net/net is that if a town is clean and tidy people will tend to keep it clean and tidy. If it’s messy, people have a tendency not to think twice when littering. This is also why the police tend to monitor and ticket for simple things like seat belt infractions. People are more likely to pay attention to the rules of the road, red lights, drunk driving, speeding if they know that it matters and it’s being watched.

The flowers on the bridge may be our way of gauging the town’s petty crime ‘temperature’. The increase in flower pulling and a general sense of civic ‘disobedience’ is not a good sign when understood in the context of the larger district crime increase.

So what’s to be done? In terms of the regional picture this is an issue that needs to be monitored and addressed by the many communities, the OPP and regional officials if the recent increase in ‘crime’ is more than an aberration. In terms of Parry Sound we need to stay on top of things like the ripped out flowers, littering and petty vandalism, and address them quickly. The Broken Windows Theory suggests the best way to prevent littering is to pick up the litter right away, and the way to reduce graffiti is to remove it right away.

If the town wants to have flowers on the bridge where they can be torn out there needs to be a commitment to replacing them; right away. Better no flowers than pillaged flower boxes.

The Scene of the Ongoing Crime

Accidents Happen – Bridges and Trains (Update)

21 Tuesday Aug 2012

Posted by in Parry Sound, Safety, Train

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Update: Friday, August 24th

It appears there is no obvious cause for the train derailment in Ellicott City, MD. The emergency brakes were applied, but not by the crew and this apparently was not the reason the 21 cars left the track and spilled their load in the downtown.

The two college students killed by the derailment, suffocated by the weight of the coal in the rail cars when they derailed, were not responsible in any way for the derailment.

This is the most troubling part of the accident. There is no obvious cause for the accident. No red flag pointing to remedial actions that might be implemented to prevent future accidents. Stuff seems to happen. An in the case of Parry Sound it suggests we can never really feel protected from a similar accident. With two twisting rail lines and two bridges, and forty trains a day, something is bound to happen. Let’s make sure we are prepared to minimize the damage to the town and the environment.

Original Post:There is a report of a train derailment in Maryland that has killed two people (USA Today & CBS News). The report seems a little closer to home given that the accident involved 21 rail cars of a freight train derailing off of a bridge crossing the Patapsco River in the historic area of Ellicott City. The rail cars fell overnight onto a parking lot in the town. Cranes are being used to removed the rail cars to see if there are any additional victims.

Stuff happens; let’s make sure we are properly prepared in Parry Sound for a worst case event. We can’t control what the railways do in our town. We can only control how we respond.

Downtown Ellicott City Train Derailment

Council Meeting Summary – August 14, 2012

15 Wednesday Aug 2012

Posted by in Budget/Financial, Parry Sound, Town Council

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Okay here’s a brief summary, with opinion, of last night’s council meeting. The Moose-FM has already tweeted the highlights and the North star will provide more in-depth coverage in the Friday and next Wednesday issues of selected topics. And the town will issue its meeting minutes in a day or so.

A reminder, there is now a Parry Sounds and Sights Facebook page (link). The Facebook page posts up some short notes, links and photos that are relevant to life in Parry Sound. This blog is also available through the Facebook page.

Meeting Notes

Deputations:

The Parry Sound Taxi deputation made a good argument as to why there should be a more transparent process for temporary driver permits while the necessary authorities (not town personnel) get around to providing the required documentation to get permanent licenses. There has to be a way to work this out.

Item 8.2: A resolution to ‘encourage’ the construction and operation of solar energy generation was approved. We’ll see what this means in practice but it cost nothing and indicates a positive attitude on the part of the town.

Items 9.3.1, 9.3.4 and 9.3.5: A series of resolutions related to Sign By-law requests were approved. I’m not sure more signs contribute to the sense of a quaint little town, but perhaps that’s not the look the town is going for.

Item 9.4.1: The resolution to ‘write-off’ unpaid inactive sewer and water accounts going back to 2004 was approved without any meaningful discussion. You have to do what you have to do, but here’s hoping that the town can limit or eleiminate future loses.

Item 9.4.2: The resolution related to town staff, elected official and their social media responsibilities was approved with only a couple of comments. It’s really a non-issue, sort of like the rules requiring food service employees to wash their hands after using the bathroom.

Item 9.4.3: The direction to staff to study and examine opportunities to improve the delivery of town services with the intent of reducing costs as well increasing revenues received the largest amount of discussion. There will be a meeting on the 28th to discuss the process. A couple of comments; we consultants actually get paid for this type of ‘wisdom’: don’t let the perfect get in the way of the good. Designing the perfect process at the expense of actually implementing the process is a common cause of failure. Get into it and revise the process as it becomes obvious to do so. And about revenue and expenses. The budget gap can only be properly addressed by cutting expenses rather than raising revenues. The town really has limited opportunities for raising or finding new revenue sources. Increasing meeting room costs or charging for boat launching will add only ‘nickels and dimes’. The only real way to address the budget gap through revenue is to get additional federal and provincial funding; or raise property taxes. With elections not that far off and town resident’s memories even longer, I expect we will see town council start swinging axes to cut costs rather than raise property taxes. The earlier the review is started the more thoughtful, and hopefully less painful, the cuts will be.

Item 9.6.1: The direction to staff to investigate a by-law to control the building of fences was revised to a direction to find ways to manage fences being built on town property. It was approved by a 4-3 vote (much closer than I thought it would be).

Item 10.6.1: Related to the approval of the Parry Sound Hydro Corporation minutes. In the discussion the need for an August 28th closed council meeting to discuss a PS Power matter was raised. Could this be the ‘secret’ power generation plant investment? I am looking forward to getting full information on the investment, it really isn’t much of a secret any longer. We need to know as a town what we may be ‘on the hook’ for if the investment is approved.

That’s it. See you at the special meeting of council on the 28th (7:00 PM unless it is otherwise changed).

Nice beach, nice town – Parry Sound

Council Agenda Preview – August 14, 2012 Meeting

12 Sunday Aug 2012

Posted by in Budget/Financial, Parry Sound, Sights, Town Council

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This post provides a brief preview of items on the upcoming Parry Sound Town Council meeting on August 14th. Please head over to the town’s website for a copy of the agenda. A copy of the council meeting package is available for review at the town office and the town library (closed Mondays).

I’d also like to announce that Parry Sounds and Sights, this blog, has a new Facebook page (link). I’ll use the Facebook page to post up some short notes, links and photos that are relevant to life in Parry Sound. This blog is also available through the Facebook page.

Agenda Items

Deputations:

Parry Sound Taxi will be making a presentation to town council about the challenges they face in getting timely approval for new drivers. Based on the letter included in the council meeting package and recent press coverage there is considerable frustration on the part of the taxi service operators with the current approval process. Like too many regulated services there continue to be new layers of regulations added on to private service providers that may in the end make it cost prohibitive to remain in business or provide the level of service that the public can afford.

Item 8.2: This is a resolution to encourage the construction and operation of solar energy generation. It seems to be an administrative gesture that has no real impact on the town. And on the subject of solar energy does anybody know what’s going on with the privately financed solar energy project on town property that was approved last year? I believe the province has reduced the rates it pays for electricity from new solar installations to the point that new solar installations aren’t a slam-dunk way to make money. I’m glad the town passed on the opportunity to co-invest last year.

Items 9.3.1, 9.3.4 and 9.3.5: This is a series of resolutions related to Sign By-law requests. I’m not sure I understand all of the issues but I hope council ensures that Parry Sound doesn’t become littered with signs that really make the place look like a southern ‘border town’ and exudes a sense of desperation. Perhaps the sign regulations can be relaxed for the summer months to service the tourist market with the understanding that they are removed in the off-season especially if the service is no longer being offered. I believe the Downtown Business Association (DBA) has put forward a plan for signage within the DBA area that might serve as a practical template for the whole town.

Item 9.4.1: This is a resolution to ‘write-off’ unpaid inactive sewer and water accounts going back to 2004. We now have a total for this write-off; $57,000, of which about $11,000 is related to unpaid bills for 2011.

Item 9.4.2: This resolution relates to town staff, elected official and their social media responsibilities. It really is a summary of what shouldn’t be done by staff and council. I hope we will soon see a draft policy of what they should do to better keep town residents and tax payers ‘in the loop’ with respect to town activities and plans.

Item 9.4.3: This is a direction to staff to study and examine opportunities to improve the delivery of town services with the intent of reducing costs as well as ways to increase revenues. This all relates to the upcoming 2013 budget which will be a challenge to balance. I’m glad to see this type of proactive initiative, early is always better when it comes to strategic, tactical and budget planning.

Item 9.6.1: This is a direction to staff to investigate a by-law to control the building of fences. I’m not sure we really need more regulation unless there are good reasons and the regulations are applicable only to exceptional situations.

Item 10.6.1: This item relates to the business of the Parry Sound Hydro Corporation. The very short minutes included in the council meeting package provide a little insight into the capital investment plans of Parry Sound Power (I will use Parry Sound Power to refer to the ‘conglomerate’ realizing there are a number of separate companies). The new generation facility project is referred to in the minutes as “PowerGen” and “PGen”. Brenda Dobson and Peter Brown would be responsible for the shareholder’s (Town of Parry Sound) financial control and accountability. This is good news, the town needs to be ‘in the loop’. There was mention of looking for outside funding (FedNor, Infrastructure Ontario) to support the project. The amount noted in the minutes was $10.9 million. Enough said; let’s see when the ‘shareholder’s shareholders’ (that’s us) are provided with some details and allowed to weigh in on the project. Not many good things happen behind closed doors.

An aside; if you know the people who operate this business please ask them to ‘clean up’ this situation (photo below). One ripped and on the ground, the other standing tall but ripped doesn’t reflect well on the business or the area. It’s been this way for a couple of weeks at least. South of the border they take this as a sign of disrespect, and rightly so. If you can’t do it right, don’t do it at all.

The Politics and Nature of Energy Production

08 Wednesday Aug 2012

Posted by in Budget/Financial, Parry Sound, Suggestions, Town Council

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As regular readers of this blog probably know I have been interested and concerned about what Parry Sound Power and Parry Sound town council have been discussing with respect to a major investment in power generation at the Cascade Street facility.

Rather than review these concerns I’d like to address a couple of more recent developments that I hope are part of the discussion related to the investment.

The first concerns nature. This is not meant to be a cheap shot, but it’s been pretty obvious that there has been little or no revenue from power generation at the Cascade Street facility for at least the last couple of months. Nature is like that, even if you don’t believe in Climate Change. You may be able to ‘make hay while the sun shines’ but you can’t generate hydroelectric power without rainy days, preferably lots of them. Unfortunately principal and interest costs are payable whether or not you are generating income. That’s the rub with any multimillion dollar investment in expanded power generation. In theory and practice there should be a positive payback over the long term based on historical flow data and favourable prices for the power generated. But as many investors have found you may have been right in the long term but you went bankrupt in the short term as expenses exceeded revenue and your financial reserves.

Parry Sound unfortunately doesn’t have the ability to ‘inventory’ water and release it as required to optimize revenue. There is no large reservoir that can be tapped. Water levels in the lakes upstream of the dam need to be carefully managed to prevent flooding and can’t be used as reservoirs. This means we need to generate power when there is flow. This is perhaps why an investment in additional power generation is being considered, to capture the very large flow that arises every spring with the winter snow melt. It doesn’t do any good the rest of the year, and needs to pay for itself in a relatively short period, at most two months every spring.

I’m sure the cost/benefit analysis of a power generation upgrade is based on precipitation levels for the past fifty years or so. To quote the standard disclaimer for brokerage firms “past performance is no promise of future returns”. In the same way we can no longer rely on past climate data as a reliable indicator of future weather. There is no doubt there are real changes in our climate, possibly a ‘celestial’ related event outside of our control and current understanding, or human activity related global warming. The net/net is that precipitation levels and temperatures are not as reliable as they once were. Less water would mean less power generation, more would mean more. But warming is more of a concern. If our winters continue to stay warmer there will be much less of a snow pack to melt and yield the spring runoff that supports an increased power generation capacity. Rather there will probably be a more continuous flow of water all winter that should not exceed our current generating capacity. But who knows what will and won’t happen going forward. Are you willing to bet $15 million that it will all work out in the short as well as long term?

And then there is the politics, not local but provincial. The only way that a major investment in power generation can pay off is if Parry Sound Power receives a higher price per kilowatt hour generated than the current market prices. The Ontario Government, to stimulate the construction of new renewable power generating capacity, has promised to pay a higher than market price for power from these sources. But this promise and these prices may not be as reliable as once thought based on complaints related to their promises to the solar power community (CBC article link).

Despite promises, and even contracts, it is clear that governments are not always able or willing to meet their obligations. People change, governments change, and markets change. This means that any investment based on a government commitment to subsidize, or support initiatives must be carefully scrutinized to ensure there is the possibility of life even without government support. Parry Sound finds itself even now dealing with challenging budget issues not because of unreasonable cost increases, or reckless spending, but rather a loss of provincial and federal funding.

Weather and politics are perhaps the two most unpredictable forces that we face. Depending on both for a favourable outcome seems a little too risky.

Here’s a recent photo of the “Festival Tree”. As the days grow shorter and the Festival of the Sound approaches the end of its season we are reminded that summer is a limited time opportunity. It’s time to head outside and enjoy the summer for all it has to offer before it’s gone.

Another spectacular sunset at the Stockey Centre