agenda of special council - 30 april 2020€¦ · 30-04-2020 · special council meeting agenda 30...

Agenda

Electronic Special Council Meeting

30 April 2020

The information contained in this Agenda is made available free to any member of the public.

Subject to copyright restrictions, members of the public may obtain copies of reports, attachments and tabled documents in accordance with the provisions of the Local Government Act 1995.

NB: Plans are generally not permitted to be copied due to copyright restrictions.

SPECIAL COUNCIL MEETING AGENDA 30 APRIL 2020

Page ii

TABLE OF CONTENTS

ITEM SUBJECT PAGE NO

1. DECLARATION OF OPENING ANNOUNCEMENT OF VISITORS AND DISCLAIMER .................. 2

2. ATTENDANCE ....................................................................................................................... 2

2.1 Apologies .............................................................................................................. 2

2.2 Approved Leave of Absence ................................................................................. 2

3. DISCLOSURE OF INTERESTS .................................................................................................. 2

3.1 Declarations of Interest (Financial) ....................................................................... 2

3.2 Declarations of Impartiality and Proximity ........................................................... 2

4. QUESTION TIME FOR PUBLIC ............................................................................................... 2

5. RECEIVING OF PETITIONS, PRESENTATIONS AND DEPUTATIONS......................................... 2

6. REPORTS .............................................................................................................................. 2

6.1 Director Canning Community and Commercial ..................................................... 3

CC-014-20 Rental Abatements to Respond to COVID-19 Pandemic ............................... 3

CC-015-20 Community and Business Support - Phase 1 Response ............................... 10

CC-016-20 Budget Review as at 31 March 2020 .......................................................... 24

7. MOTIONS OF WHICH PREVIOUS NOTICE HAS BEEN GIVEN ................................................ 37

NOM-004-20 Establishment of COVID-19 Recovery Coordination Group ......................... 37

8. CLOSURE ............................................................................................................................ 41


Page 1

NOTICE PAPER

SPECIAL COUNCIL MEETING

THURSDAY, 30 APRIL 2020

MAYOR AND COUNCILLORS

I inform you that a Special Council Meeting will be held electronically on 30 April 2020 at 6.00pm. A meeting invite containing a link will be emailed to you.

Your attendance is respectfully requested.

On the 7 April 2020, the Commissioner of Police and State Emergency Coordinator issued a Closure and Restriction (Limit the Spread) Directions, pursuant to section 56 of the Emergency Management Act 2005, which applies to the state of Western Australia.

The purpose of the Directions is to close certain places and prohibits certain gatherings and activities in order to prevent and control the risks associated with the public health emergency presented by COVID-19, by limiting the spread.

In accordance with this Direction Notice, the City of Canning is unable to conduct its Council Meetings in the Council Chambers as a public meeting.

Recent amendments to the Administration Regulations allow Council meetings to be conducted by electronic means during this public health emergency.

In accordance with Regulation 14 D(2), the Mayor has determined to conduct this Ordinary Council Meeting via an electronic means. Whilst the current public health emergency caused by COVID-19 is in force, and until revoked by the Mayor, all future Council and Committee Meetings are authorised to be undertaken via video conference.

Information relating to asking a Public Question or presenting a Deputation at an electronic Council Meeting can be found on the City’s website.

The purpose of the Special Meeting is for Council to give consideration to the following reports:

a) Rental Abatements to Respond to COVID-19 Pandemic b) Community and Business Support – Phase 1 Response c) Budget Review as at 31 March 2020 d) Establishment of COVID-19 Recovery Coordination Group.

Yours faithfully, Tuesday, 28 April 2020

Athanasios (Arthur) Kyron Chief Executive Officer

https://www.wa.gov.au/sites/default/files/2020-04/Closure%20and%20Restriction%20%28Limit%20the%20Spread%29%20Directions%20%281%29.pdf

https://www.wa.gov.au/sites/default/files/2020-04/Closure%20and%20Restriction%20%28Limit%20the%20Spread%29%20Directions%20%281%29.pdf

https://www.canning.wa.gov.au/about-us/council-business/your-councillors/council-meetings


Page 2

AG EN D A

If any of the Elected Members have any queries on the Items set out in this Agenda, it would be appreciated if they could contact the relevant Director:

1. Chief Executive Officer 9231 0603

2. Director Canning Community and Commercial 9231 0750

3. Director Sustainable Development 9231 0676

4. Director Canning Environment 9231 0645

1. DECLARATION OF OPENING ANNOUNCEMENT OF VISITORS AND DISCLAIMER

2. ATTENDANCE

2.1 Apologies

2.2 Approved Leave of Absence

3. DISCLOSURE OF INTERESTS

3.1 Declarations of Interest (Financial)

Officer/Elected Member

Order of Business/ Report No

Agenda Page No

Item Details Intent to Seek Ruling

Nature of Interest

3.2 Declarations of Impartiality and Proximity

Officer/Elected Member

Order of Business/ Report No

Agenda Page No Item Details Nature of Association

4. QUESTION TIME FOR PUBLIC

5. RECEIVING OF PETITIONS, PRESENTATIONS AND DEPUTATIONS

6. REPORTS


Page 3

CC-014-20 Rental Abatements to Respond to COVID-19 Pandemic CC-014-20

6.1 Director Canning Community and Commercial

CC-014-20 Rental Abatements to Respond to COVID-19 Pandemic

PROGRAM: Canning Community and Commercial

SUB PROGRAM: Land Utilisation

FILE REF: Q20/152

REPORT DATE: 28 April 2020

REPORTING OFFICER: Nikki Crook - Leader Land Assets

RESPONSIBLE OFFICER: Garry Adams - Director Canning Community and Commercial

Strategic Plan Theme: LEAD - Accountable, responsible and forward-thinking administration.

Community Goal: Effective leadership and good governance. Council Strategy: Comply with legal requirements.

Authority/Discretion: Executive: The substantial direction setting and oversight role of the Council eg adopting plans and reports, accepting tenders, directing operations, setting and amending budgets.

Attachments: 1. Advice to City of Canning - Rental Abatements (D20/45459). (Confidential)

In Brief:

This item is presented to Council at this time because it directly deals with the impacts of the current pandemic on local businesses and community groups.

In view of the COVID-19 Pandemic and the enforced social distancing, limits on gatherings and restrictions or closure of business operations, the City has received a number of requests from its tenants to consider waiver or discount of rent payments.

The report considers the options available to Council to grant temporary rental abatements, in view of the substantial impact the pandemic has had on the activities and operations of its tenants and, for many, their reduced income earning potential that allows the payment of rent. The recommended approach will take into account the unique circumstances of each tenant with intent of providing a fair and equitable outcome.

This item is reflective of the request by the Premier, Hon Mark McGowan, that all local governments consider concessions on Rates, Fees and Charges to provide relief for families and businesses from the impacts of the COVID-19 Pandemic.


Page 4


OFFICER RECOMMENDATION

That Council:

1. Delegates to the Chief Executive Officer pursuant to section 5.42 of the Local Government Act 1995, the power to grant temporary rental abatements for the City’s leased premises on the following basis:

a) The tenant must make application to the City detailing their financial hardship and the difficulties they may experience in meeting the financial obligations under their lease which will also act as written consent by the tenant to amend a lease agreement;

b) Any decision to grant an abatement takes account of any other stimulus or incentive received by the tenant specifically for meeting their rent payments;

c) An abatement of up to 100% may be applied to rental payments for Commercial Tenancies for a period of up to six months, commencing 1 April 2020;

d) An abatement of up to 100% may be applied to rental payments and outgoings for Community, Sporting or Other Not for Profit Tenancies for a period of up to six months, commencing 1 April 2020;

e) No discount will be applied to outgoings for Commercial Tenancies, however the City may consider deferral of payments where necessary at the discretion of the Chief Executive Officer;

f) Any rental abatement or change to outgoings will be done as a temporary variation to the lease agreement;

g) Where agreement cannot be reached between a tenant and the Chief Executive Officer on the level of abatement applied, an item to Council will be presented for determination.

2. Requests a further item be presented to Council in the June round of meetings to consider the ongoing implications of the COVID-19 Pandemic on the City’s tenancies and reporting the variations that have been agreed.

**ABSOLUTE MAJORITY REQUIRED**

Relevant Council Resolutions

Council Meeting and Date Report No Decision

Nil.

BACKGROUND

1 The City currently has 74 active lease agreements, where by a tenant leases a City facility in exchange for the payment of rent. A further 30 future tenancies are pending negotiation of a new agreement.

2 The City currently receives approximately $1.91 million in lease rental per annum, or the equivalent of $159,225 per month (though it is not averaged equally throughout the year, as many rentals are paid annually).

3 It is anticipated that the social distancing restrictions and limits to gatherings will impact the City’s tenants as follows:

a) 35 leases to sporting or community groups will be directly impacted by social distancing restrictions. The State Sporting Associations for all major sports have cancelled all club activity for the foreseeable future, most until 31 May 2020;


Page 5


b) 10 leases to child care, educational facilities, playgroups etc which have been either choosing to close for health and safety reasons or have experienced significantly reduced attendance numbers;

c) 12 commercial tenants will be directly impacted by the social distancing restrictions, particularly the four cafes which have had to revert to takeaway service only, and the three leases to Silver Chain. There will also be impacts on the tenants at 37 Murray Road, particularly the café and the training provider, who have had to substantially amend their business practices; and

d) It is expected that 17 commercial tenants may not be impacted by social distancing restrictions and can continue operations, however the general economic downturn currently being experienced may have some impact. It is noted that a number of these tenancies are for telecommunications infrastructure and the balance are tenants at 37 Murray Road.

4 On 30 March 2020, the State Government announced that small businesses and not for profits situated in government buildings (ie owned by the State of Western Australia or other subsidiary) would have their rental waived for a period of six months to help these leaseholders respond to the impacts of the Covid-19 Pandemic.

5 On 7 April 2020, the Prime Minister released the mandatory code for commercial landlords and tenants. The general principles of this code are summarised as follows:

a) The Code will be legislated and regulated in each state and territory. Dispute resolution will occur via binding mediation;

b) It will apply to commercial tenancies where the landlord or tenant is eligible for the JobKeeper program and where they have a turnover of $50 million or less;

c) It is designed to protect small and medium businesses, extending to both tenant and landlord;

d) Landlords will be required to reduce rent proportional to the tenants’ trading reductions via rental abatements and lease extensions over the course of the pandemic period;

e) The rental abatements must account for at least 50% of the reduction in business and deferral of rents must be covered over the balance of the lease of the lease term, but for no less than 12 months; and

f) Landlords may not terminate the lease for non-payment of rent and tenants must honour the lease. The aim is to preserve the lease and preserve the relationship.

DETAILS

6 At the time of writing this report, the following groups have approached the City directly seeking a reduction or waiver of rent payments:

Tenant Current Monthly Rent

Lo Quay Café (J Harry & N Ogden) $5,228

CREEC Café (Manta Services & Heart in Hospitality) $2,706

WA 8 Ball Federation $5,974

Kelyn Training Services (37 Murray Road – five units) Approach made via MMJ, the managing agent

$4,730

Willetton Basketball Association $218

(paid annually $2,619)

Whaleback Golf Course $32,020

Kingston Equipment Trust $1,200

Corinthian Park Tennis Club $130(paid annually $1,565)


Page 6


7 In reviewing possible rent relief schemes that the City might employ, the following options could be considered:

a) Waiver of monthly rent payments for a three to six month period; or

b) Discount of rental payments for a three to six month period; or

c) Deferral of rental payments for a three to six month period. In most instances, this is not considered a desirable option, as it will involve the accrual of debt over a time period where many tenants will be receiving little or no income and it may take some time to recover from the COVID-19 Pandemic; or

d) No waiver or discount is considered for tenants in view of the assistance being offered at State and Federal Government levels. This option may prove to be undesirable for Council, in view of the impact the COVID-19 pandemic is having on its community and commercial tenants and the broader community generally.

8 No change or amendment to the outgoings charges is proposed for the Commercial Tenancies. Outgoings encompass costs such as utility charges, rates, the Emergency Services Levy, building insurance etc, majority of which are costs incurred by the City and passed on to the tenants. While the City might consider temporarily varying the rental income, the costs it incurs should continue to be covered and on-costed to the tenant. However, it is recognised that some relaxation may be required in payment timeframes to allow tenants to meet their requirements in the future.

9 It is proposed that some discretion may be necessary for outgoings charged to Community, Sporting and Other Not for Profit Tenancies, particularly those that have not been able to occupy their building. This is to be considered on a case by case basis.

10 A preferred approach is outlined, as follows:

a) The City requires that any tenant wanting a rental abatement, makes an application to the City (in standard form) that justifies the basis of hardship experienced during the COVID-19 Pandemic and provides their written consent to vary a legal agreement between themselves and the City;

b) That the decision to vary the lease and grant a rental abatement be delegated to Chief Executive Officer and in turn to the Director Canning Community and Commercial;

c) The Director Canning Community and Commercial be allowed to discount the rental payments by up to 100% per month (or annual equivalent) for a six month period. This discretion will apply to both Commercial Tenancies and Community, Sporting or other Not for Profit Tenancies. This variation will be done as a temporary variation to the agreed lease;

d) No discount to outgoings will apply for commercial tenancies. While outgoings are to be charged in full, it is proposed that some discretion be permitted to allow City Officers to defer payment of various charges where it will place an undue financial burden on the tenant;

e) The Director Canning Community and Commercial be allowed to discount, defer or waive the outgoings charges for Community, Sporting or other Not for Profit Tenancies;

f) The rental abatements may commence from 1 April 2020. The monthly rental invoices for April and May have been held back for majority of tenants, pending the consideration of this Council item;

g) Where an agreement cannot be reached with the tenant around the level of abatement applied, an item will be presented to Council for determination;

h) A further item to Council will be presented to the June 2020 round of meetings to report on the lease variations granted temporarily and considering an ongoing approach moving into the next financial year, based on the current status of the COVID-19 Pandemic at that time.


Page 7


11 Based on the annual lease income expected for the 2019-2020 financial year, if every tenant was granted a hardship rental abatement of 50%, this would equate to approximately $480,000 in lost income over six months. A 100% abatement for six months would equate to approximately $960,000. This is the worst case scenario, though noting that there are a number of commercial tenancies that may not be impacted by the pandemic.

12 If this approach is supported by Council, City officers will write to all tenants advising of the rent relief program that has been brought into place and assist those members in making the hardship application.

CONSIDERATIONS

Legal Compliance

13 Clause 6.12 of the Local Government Act 1995, contained within the general financial provisions, allow a local government to waive or grant concessions in relation to any amount of money which is owed. This is an absolute majority decision of the Council.

14 Clause 3.58 of the Local Government Act 1995 allows a local government to dispose of property, which includes a lease, either via public auction or tender or otherwise, with public notification of the proposed disposition.

15 The City’s leases have been made pursuant to Clause 3.58 of the Local Government Act 1995. The City has received legal advice stating:

a) Where there is a lease agreement in place, this agreement will prevail over the requirements of the Local Government Act 1995;

b) Rent which is payable under a lease arises by virtue of the provisions of the lease, not the Local Government Act 1995. As such, any rental abatement or waiver of rent must consider the provisions of each lease;

c) A lease agreement can be varied on a temporary basis through exchange of correspondence to the tenant. This allows the City to amend the rental payments specified within the lease for a temporary period;

d) The variation of a lease must be resolved by Council, but where there are multiple requests, the Council could consider delegating the authority to the Chief Executive Officer to grant such abatements and for a certain period of time.

16 The advice provided also extends to the administration of the lease variations, which will be observed if this is supported by Council.

Policy Implications

17 Council Policy BR.01 – Tenancy Management states that rents shall be either based on the City’s Schedule of Fees and Charges or rent for commercial tenants will be based on market valuation / appraisal. The Chief Executive Officer has delegation to negotiate a 10% variance on the market valuation amount provided to the City.

18 This policy outlines that the tenant will be responsible for all outgoings, including (but not limited to) utility costs, rates charges, Emergency Services Levy and building insurance. Most outgoings are charges incurred by the City and passed on to the tenant.

19 There are no provisions within the Tenancy Management Policy concerning rental abatements.


Page 8


Financial Considerations

Business Plan

20 This action is consistent with the City’s Corporate Business Plan 2018-2021 for the Land Utilisation Sub Program, which includes working with our lease holders to coordinate the obligations of their lease agreements.

Internal Budget

21 Lease income across various line items was budgeted to amount to $1.671 million in the 2019-2020 financial year. At this stage, it would appear that actual income would be expected to exceed budgeted income.

22 As mentioned above, should Council wish to apply a 50% discount to monthly rental payments (or the annual equivalent), the lost income should not exceed $480,000. If the approach proposed above is supported, a portion of this lost income will occur in the 2020-2021 financial year (July rents) and the budget could reflect the discount such that this does not represent a loss in this financial year.

Asset Management

23 Generally, where a property is leased, the tenant is responsible for the day to day maintenance of the asset and the City assumes structural maintenance. No change to the maintenance obligations are proposed as part of the rental abatements arrangement outlined in this report. However, it is noted that any financial stress suffered by the tenants as a result of the COVID-19 Pandemic may flow on to their ability to undertake the maintenance obligations and, similarly, any rental relief supported by Council will benefit the continued maintenance of the City’s assets.

Sustainability Considerations

24 The new Sustainability policy was adopted 18 June 2019. The City is now working towards determining a set of City-wide targets, which will provide measurable criteria for sustainability progress assessment.

25 In considering the new Sustainability Policy CM194 commitments, this project is consistent with Policy Commitment 8 – Take a knowledge-brokering and capacity-building approach, and facilitate positive relationships with the community to create shared understanding and foster collective responsibility, advocacy and action.

Consultation

26 The City has been providing regular updates to all tenants on the City’s response to the COVID-19 Pandemic and the social distancing measures now in place. This has generated conversations with a number of tenants on their own response to the crisis.


Page 9


Other Considerations or Risks

Risk/ Opportunity Consequences Mitigation/

Actions Consequence

Likelihood X

Consequence Rating

= Overall Risk/ Opportunity

Officer Recommendation approved by the Council (positive outcomes) Opportunity A

Tenants are provided some rental relief during the COVID-19 Pandemic period.

Standardised application to be developed to allow tenants to make hardship application.

Likely Moderate Medium

(Opportunity)

Officer Recommendation approved by the Council (negative outcomes) Risk B

Lost rental income which represents a financial loss for the City.

It is possible that actual income was likely to be higher than budgeted income and the overall loss is not considered to be substantial.


(Risk)

Officer Recommendation deferred by the Council Risk C

Creates further uncertainty for tenants at a time of extreme pressure.

City officers have aimed to present a position to Council with some urgency to reflect the unprecedented restrictions that have been applied and the likely impact this will have on the City tenants.

Likely Minor Medium

(Risk)

Officer Recommendation declined by the Council Risk D

Tenants will not have access to a rental abatement through the City and must rely on other incentives provided by the State and Federal governments.

A fair and conservative position on rental abatements has been outlined for Council’s consideration.


(Risk)

COMMENT

27 The variation to an existing lease is not considered to be a decision requiring the absolute majority of Council. Leases are made pursuant to clause 3.58 of the Local Government Act 1995, which is a simple majority decision, and the leases are then administered subsequent to this decision. The temporary variation to the terms of those leases is seen as part of the administration of the lease.

28 However, in delegating the power to grant these abatements to the Chief Executive Officer, this is an exercise of section 5.42 of the Local Government Act 1995 and requires an absolute majority decision.

VOTING REQUIREMENT

29 Absolute majority (section 5.42 of the Local Government Act 1995).

AGENDA BRIEFING COMMENT

30 Not applicable.


Page 10

CC-015-20 Community and Business Support - Phase 1 Response CC-015-20

CC-015-20 Community and Business Support - Phase 1 Response


SUB PROGRAM: Business Canning

FILE REF: Q20/153


REPORTING OFFICER: Steve Leeson - Executive Manager Business Canning



Community Goal: Innovation, flexibility, and resilience. Council Strategy: Effective policy development and implementation.

Authority/Discretion: Legislative: Includes adopting Local Laws, Town Planning Schemes and Policies. Review when Council reviews decisions made by Officers.

Attachments: 1. Policy FM.13 Financial Hardship (D20/43656).

In Brief:

This item is presented to Council at this time because it directly deals with the impacts of the current pandemic on local businesses and community groups.

This report requests Council to consider implementing a range of measures in response to the impacts of the COVID-19 pandemic to provide immediate assistance to the local community and businesses. These measures will constitute the first phase of the City’s response and will require adoption in the current budget review (separate report) and in the 2020-2021 budget scheduled for adoption in June 2020. The financial implications associated with future initiatives proposed to be included within the 2020-2021 budget, will likely cost the City approximately $16.5 million; this is an investment in the City of Canning community and businesses.

As the full economic and social impacts of this pandemic become fully understood, further measures will need to be considered by Council as part the City’s long term community Recovery Plan that will be developed over the coming months.


Page 11



That Council:

1. Adopts the proposed policy FM.13 Financial Hardship – Collection of Property Rates, Fees and Charges as contained in Attachment 1 to allow for the cessation of penalty interest, a pause on payments for up to six months and the establishment of alternate payment arrangements.

2. Requests the Chief Executive Officer to prepare a draft 2020-2021 Budget to include the following:

a) No increase to residential or non-residential rates;

b) No increase in the waste service fee, transfer station fees, or the security charge;

c) Deferral of any new underground power charges for 12 months;

d) Waiving of inspection fees for food businesses;

e) Rental abatements granted with regard to rent for City owned premises;

f) Delay of the first rates instalment due date to November 2020.

g) Extended payment terms and concessions on interest charges in accordance with the Financial Hardship Policy FM.13;

h) Maintaining creditor terms of under 14 days for all small and medium businesses;

i) Appropriate allocation of funds for the Connect in Canning project to support community led initiatives and the connection of vulnerable people to identified community supports;

j) The bringing forward of capital projects that stimulate the local economy, create jobs and keep people in work; and

k) Other initiatives to stimulate local business and assist in the recovery process developed in consultation with local businesses and the community.

3. Requests the Chief Executive Officer to undertake a review of the waste collection service with regard to the changing needs of the community, given the impacts of the COVID-19 pandemic and report back to the May Ordinary Council Meeting.

4. Requests the Chief Executive Officer to undertake further modelling and report back as part of the draft budget process, on the impacts and potential outcomes of the following:

a) A part rate reduction within the 2020 – 2021 Annual Budget;

b) The complete removal or reduction of instalment interest for the 2020 – 2021 financial year; and

c) The introduction of a rate rebate voucher to be spent with local City of Canning businesses.

5. Approves the redirection of $80,000 from remaining grant funds for 2019 - 2020 to establish the Canning Resilience Grants and that these grants be made available to not-for-profit organisations, unincorporated groups, and small businesses operating within the City of Canning.




SCM 15 August 2019 CC-040-19 SCM 15 August 2019


Page 12


BACKGROUND

1 The COVID-19 pandemic has and will continue to impact upon the health and economic situation of the City’s residents and local businesses. The Commonwealth and State Governments are putting in place (which all communities are obliged to adhere to) certain measures to combat the spread of COVID-19. These measures have temporarily changed the way we live and work.

2 In response to these measures, people and businesses have forcibly reviewed their practices. The serious disruptive impact upon the movement of people and goods suppresses supply chains and consumer demand, with the resulting economic downturn having a significant negative impact upon employment.

3 Federal, State and Local Governments are still operating in the response phase of this crisis and it is unclear as to how long this will continue before the recovery phase will begin. Whilst the City can do things now that will assist in dealing with the crisis and also in assisting recovery from its effects, a full Community Recovery Plan will be developed over the next few months.

4 As an initial response, and without knowing the full economic and social impacts of this pandemic, a number of initiatives have been identified towards supporting Canning’s residential and business ratepayers. Through using both policy and financial measures, immediate and 2020-2021 financial year considerations are available.

5 The City of Canning has a range of policies that are adopted by Council, which:

a) Set direction;

b) Guide decision making by Elected Members and Administration; and

c) Inform the public.

6 Policies, together with CEO Instructions and procedures, are a fundamental component of a good governance framework.

DETAILS

7 In addition to what is currently being made available from the Commonwealth and State Governments, the City recognises that it too has an important role to play.

8 At a local level, the impacts of COVID-19 have already been experienced. The City’s own response to COVID-19 measures has seen:

a) Closure of both Leisureplexes;

b) Closure of all Libraries;

c) Closure of all outdoor play equipment, skate and BMX parks;

d) Cancellation of the remaining Events program; and

e) Lockdown of Canning Lodge Aged Care Facility.

9 Elected Members and administration have expressed a shared concern for the community, including business and have shared ideas that can be applied to reducing the burden of the impact of COVID-19 on people in the City of Canning. These ideas make up the responses outlined below:


Page 13


10 The financial implications associated with immediate initiatives for the 2019-2020 budget will cost the City $706,225 as detailed below:

1 Financial Hardship concession on penalty interest on current year rates $ 40,000

2 Fees and Charges - Food premise Licence Fees $ 7,000

3 Abatement of lease payments Initiative (assuming 50% abatement of rental due to 30 June 2020)

$159,225

4 Connected in Canning Project (Phase One) $400,000

5 Fast track planning applications No additional cost

6 Short Creditor Payment Terms Interest loss not quantified

11 The financial implications associated with future initiatives proposed to be included within the 2020-2021 budget would likely cost the City $16,561,369 as detailed below:

1 Freezing rates as compared to current Long Term Financial Plan at 3.5% $2,407,365

2 Freezing waste collection and transfer station fees $1,020,257

3 Freezing security service charge $ 42,466

4 Delay of first rates payment instalment due date to November (from September)

$ 134,531

5 Not charging food business registration fees $ 170,000

6 Financial Hardship concession on penalty interest on current year rates $ 168,300

7 Abatement of lease payments (assuming 50% abatement of all rents due for the months of July – October 2020)

$ 318,450

8 Connected in Caning Project (Phase Two) $ 750,000

9 Brought forward capital works program $11,550,000

Rating

12 A freeze on rates, waste fees and security charges: In preparing the City’s 2020-2021 Annual Budget, it is recommended that Council consider no increase to rates, waste fees and security charges. This would be in line with the expectations of other tiers of government and the community. Even though the City is expecting a significant increase in the costs of handling recyclable materials, this could be offset against the Waste Management Reserve. Efficiencies within the City’s 24/7 security patrol and surveillance service could contain any operating cost increase pressures. Whilst no increase in rates will potentially have an impact on the City’s ability to deliver services, alternative funding sources such as reserves can be used.

13 Delaying the instalment due date for the first rates instalment: It is recommended that the first quarterly rates instalment for the 2020-2021 financial year be delayed until November 2020. Whilst this will have a financial impact on the City in terms of interest earned, it will allow ratepayers to better evaluate their financial position prior to having to make the first payment and if necessary make other payment arrangements with the City. Maintaining an incentive (instalment interest) for large ratepayers with the capacity to pay in full and upfront, is important in order to maintain the City’s cash flow.

14 Ratepayers experiencing financial hardship will receive a range of options to assist in payment as outlined in proposed policy FM.13 Financial Hardship – Collection of Rates Fees and Charges which is included within this report (refer Attachment 1).


Page 14


15 Interest charges: The City charges two types of interest (it should be noted that there has been some discussion that the Minister may move to make orders under the Local Government Act 1995 (Act) in relation to the ability of Local Governments to charge penalty interest or instalment interest on outstanding rates, although it is not yet clear what these orders will be):

a) Penalty interest - this applies to any overdue rates, fees and charges. For the 2020 – 2021 financial year, it is recommended no penalty interest will apply. Beyond this, ratepayers experiencing financial hardship will not be charged further penalty interest in line with the proposed Financial Hardship policy. An exception is penalty interest on overdue Emergency Services Levy, which is a mandatory State charge and only the State has the authority to remove this.

b) Interest on instalment - the City replaced its $15 (comparatively low) instalment administration charge in 2017 – 2018 with an equivalent (for the average ratepayer of a $23,000 GRV) 3.25% rate of interest. This was specifically so that large ratepayers would no longer use the City as a cheap source of finance through paying their rates, fees and charges by instalments, at the detriment of all other ratepayers in foregone interest earnings. To cease instalment interest would jeopardise the City’s cash flow, as it would be expected that all ratepayers would take up the deferred instalment option proposed to commence in November 2020 (if was at no cost), which is intended to benefit those ratepayers in most need of support. Therefore, it is recommended to maintain this charge and look at the potential to redirect the proceeds into a ratepayer and local business (voucher) support program explained further in the report.

Underground Power

16 Deferral of landowner contribution schemes until 2021-22: There are three new underground power scheme commitments for the areas of Shelley East, Shelley West and Saint James. The landowner contributions could be deferred until 2021-2022 through capitalising the initial interest on the borrowed construction costs, providing a 12 month payment relief. Progressing these projects rather than putting them on hold, will potentially have a stimulus effect on the local economy. There is a separate report to Council regarding the underground power projects.

Fees and Charges

17 Waiving food business registration fees: All food premise inspection fees for the remainder of the 2019-2020 year and consideration to not charge the fees in 2020-2021.

Leasing Charges

18 Rental abatements for sporting and community groups leasing a City facility: Application of up to a 100% abatements on their rental payments and outgoings for up to six months. This initiative is addressed under a separate report to Council.

19 Rental abatements for businesses leasing a City premise: Application of up to a 100% abatement on rent payments for up to six months. This initiative is addressed under a separate report to Council.

20 As noted in the separate report to Council, all rental abatements will require a variation to the lease, however, the City will look to make this process as simple as possible for all eligible tenants.

Connect in Canning Project

21 The Connect in Canning project is part of the City’s response to the social distancing measures that have been put in place to prevent the spread of COVID-19. The project seeks to build community resilience through supporting the development of community networks and community led initiatives. The City will work collaboratively with the Community Services sector in developing solutions to address the needs of Canning residents and keep our community informed of the services, supports and resources that are available to them.


Page 15


22 The project will continue throughout the response phase of this crisis to ensure our community remain connected and informed and the City can ascertain any gaps in service delivery that require addressing. It is intended that the project will continue into the recovery phase to ensure the community remains supported and involved during the recovery process.

23 For the current financial year, the costs of this project are predominantly staffing costs that will be met from existing allocations in the Enriching Canning sub program budget. This is being achieved through refocusing the duties of existing staff, however it is expected that an allocation of between $500,000 and $750,000 will be required for the 2020-2021 financial year. This will be dependent upon what programming is identified through work currently being undertaken with the community to identify areas of need.

Brought forward capital works projects

24 There are a number of capital works renewal projects planned for future years, along with consideration for a number of new initiatives. Through undertaking these works earlier within the 2020-2021 City budget, through the use of borrowings at low interest rates and making repayment with following years capital works fund allocations, the City could increase local economic activity and new jobs through additional contract works.

25 Projects which may be considered include:

a) Whaleback Golf Club Irrigation Replacement $1.4M

b) Local Roads – Renew and Green Program $2.1M

c) Sustainable Lighting Project $1.0M

d) Cycling and Walking – Missing Links Project $0.75M

e) Local School – Parking Program $1.0M

f) Industrial Area Pavements Program $1.0M

g) Bus Shelter Replacement Disability Access Program $0.30M

h) Lake Street Extension Project $4.0M

Support for Local Business

26 Commonwealth and State governments are providing significant financial support for business during the response phase of this crisis. These payments are aimed at encouraging businesses to maintain staff whilst there is disruption the ability of these businesses to operate at normal levels. In addition, legislation is making it illegal for landlords to evict tenants for at least 6 months.

27 The vast majority of the City’s 8500+ active businesses are small enterprises, statistically: (Source REMPLAN June 2019)

a) Small businesses & sole traders: < 20 employees 96%

b) Medium 20 – 199 employees 3.9%

c) Large >200 employees 0.1%

28 The City will direct staff to adhere to the buy local preference as outlined in the City’s Procurement Policy.

29 The City has recently accelerated its payment terms for all small and medium businesses to less than 14 days and will continue this indefinitely.

30 Additional staff resourcing has been reallocated to the Business Development unit to assist local businesses working out what they are eligible for and in accessing Commonwealth and State grant funding.


Page 16


31 Given the impacts of COVID-19 have resulted in the City not allocating all designated grant funding for the current year, this funding could be utilised to provide further grant opportunities (approximately $80,000) for local businesses or not for profits, where any gaps are identified.

32 Another potential program that will be further investigated could be achieved by maintaining the interest on instalment charge and using the proceeds to part fund a voucher scheme for use at local businesses. Residential ratepayers could be provided with a voucher (say $100) as part of their rates notice, to spend at local Canning businesses, registered as part of a potential City economic support program. The program could provide as much as $1,725,000 of City funds direct to local business, with further contributions from residential ratepayers that spend more than the $100 on goods and services. Rating Relief – Financial Hardship – Collection of Property Rates, Fees and Charges Policy

33 It is acknowledged that due to exceptional and unforeseen circumstances, ratepayers may at times encounter difficulty in paying rates, fees and service charges as they fall due. The City is committed to working with ratepayers experiencing financial hardship to find appropriate arrangements to clear any debt and not cause further distress.

34 It is a reasonable community expectation, as we deal with the effects of the pandemic that those with the capacity to pay rates will continue to do so. For this reason the Policy is not intended to provide rate relief to ratepayers who are not experiencing financial hardship.

35 Financial Hardship is considered to be when a Ratepayer is willing but unable to pay their rates because of unforeseen and unexpected events that impacts substantially upon short term cash flow. This affects their ability to meet their basic living needs, or the basic living needs of their dependants, brought about for example, through:

a) Changes in employment status (such as losing a job or having hours significantly reduced);

b) Significant life events (such as serious illness, a relationship breakdown or death in the family);

c) Significant loss of revenue;

d) Emergency event or natural disaster.

36 The proposed policy establishes qualifying criteria, being:

a) The ratepayer’s circumstances can be substantiated;

b) The ratepayer is a person (not a company);

c) The ratepayer is not bankrupt;

d) The property is the principal place of residence or small business; and

e) The applicant is the owner and liable for payment.

37 The policy is intended to be administered by delegation to the CEO, on recommendation by an Approving Officer receiving applications. Given there may be a large number of people experiencing financial hardship in the short term, a team of revenue officers will be available to ensure timely processing of any application.

38 When Ratepayers are determined to be in Financial Hardship, it is recommended that the City:

a) Ceases penalty interest;

b) Temporarily pauses payment of rates, fees and charges;

c) Establishes alternative payment arrangements.


Page 17


39 It would be the City’s objective in working with ratepayers on establishing alternative payment arrangements due to Financial Hardship, that all overdue rates, fees and charges be cleared and the restoration of regular payments within two years.

40 Ratepayers would be expected to inform the City should there be changes in their circumstances that would no longer warrant consideration of Financial Hardship.

41 The proposed policy applies to residential and small business owner ratepayers as these are considered to be the most vulnerable to sudden changes in economic circumstances.

42 All ratepayers experiencing payment difficulty are encouraged to contact the City.

Waste Management

43 In recent weeks, the City’s Clean Canning staff have reported an increase in the volume and weight of waste and recyclable material being collected as part of our regular kerbside collection services, and being delivered to the Ranford Road Waste Facility. It is clear that the increases in waste generation are associated with the Government’s recommendations and response to the COVID-19 pandemic (i.e. that people should stay at home more). However what is not clear is whether these increases are of a “one-off” nature, or whether they will continue, or a combination – and if the increases continue, for how long.

44 Analysis of the composition of the kerbside (municipal solid waste; recyclables) collections is being undertaken. Options, in the context of the City’s Strategic Waste Management Plan objectives, to address the increase in the volume and weight of waste and recyclables are being developed and considered and will be reported back to Council as soon as practicable.

Canning Resilience Grants

45 The Canning Resilience Grants will be open to business owners, unincorporated groups as well as not for profit organisations operating in the City of Canning or delivering services to Canning residents.

46 The goal of this grant is to help build the Canning community’s resilience and connectedness though support for community networks and community led initiatives. The proposed grants compliment the myriad of stimulus funding available via State and Federal sources.

47 It is proposed that two funding streams be made available:

48 Small grants up to $1,000 for quick turnaround activities and Digital grants for up to $2,500.

49 The Small Grant will be ongoing and focused on enabling clubs and other organizations to respond to the social impact of COVID-19 and to support their viability to recommence activities benefiting the Canning Community once the impact of COVID-19 abates. In line with the City’s current small grant offering, this will be a quick turnaround grant option and will support a wide variety of options, based on community benefit.

50 The Digital Grant will close 18 May 2020 and is focused on supporting community organization and small business to provide a wide range of online activities. Funding can be used to support upskilling of staff and digital literacy support; delivering online learning and webinars; the purchase of hardware or software; offsetting costs of increased data usage; digital content creation etc.

CONSIDERATIONS

Legal Compliance

51 Local Government Act 1995 s6.47 Concessions:

“Subject to the Rates and Charges (Rebates and Deferments) Act 1992, a local government may at the time of imposing a rate or service charge or at a later date resolve to waive* a rate or service charge or resolve to grant other concessions in relation to a rate or service charge.”


Page 18


52 The adoption of the Financial Hardship Policy is a decision to grant a concession on interest owing on rates and service charges and as such does not require an absolute majority decision. The remainder of the initiatives will require adoption as part of the 2020-21 budget process and at that point will require an absolute majority decision.

Policy Implications

53 FM.05 Budget Preparation.

54 FM.06 Budget Variations.

55 Proposed new policy FM.13 Financial Hardship.


Business Plan

56 Business Canning:

a) Budgeting and financial reporting.

b) Treasury, revenue collection and payables.

c) Payroll and insurance.

d) Asset management.

e) Aquatic facilities, health and fitness.

f) Indoor playgrounds and function facilities.

g) Café and retail.

Internal Budget

57 While the City is in a strong financial position, COVID-19 will have a significant impact on the City’s short/medium term financial position. Revenues from many areas are projected to fall significantly including:

a) Leisureplex revenues as the facilities are closed and refunds are provided;

b) Waste revenues will fall as industry activity declines;

c) Application fee revenue has dropped;

d) Lease fee revenue will drop as many lessees are seeking rent relief;

e) Rate collection revenue is projected to be slower; and

f) Debtor payments are likely to be slower impacting on City cash flows.

58 The proposed FM.13 Financial Hardship – Collection of Rates, Fees and Charges policy may have a material impact upon the City’s budget over time, however it will not have a significant effect on the 2019-2020 financial year budget.

59 The financial implications associated with the City’s proposed COVID-19 response package will initially span two financial years (2019-2020 and 2020-2021). The immediate response will apply to the balance of the 2019-2020 financial year and the remaining components will apply next financial year and will need to be considered as part of the 2020-2021 budget process. Concessions to rates may last longer.

Asset Management

60 Not applicable.


Page 19



61 Not applicable.

Consultation

62 These recommendations have been formulated in consideration of feedback received from elected members, ratepayers, industry consultation, and customer feedback/requests. Further consultation will be required in relation to the City’s Community Recovery Plan, which will need to fully consider the economic and social impacts of this Pandemic once known.



Actions Consequence

Likelihood X

Consequence Rating



Budget prepared with measures to provide financial relief and stimulus.

Implement new policy. Incorporate direction within draft budget.

Likely Major High

(Opportunity)


Measures do not work or provide enough assistance.

Further measures still required.

Changes proposed based on response to current social and economic conditions.

Possible Major High (Risk)


Delay in putting place measures to provide relief to community.

Measures have been designed with feedback from elected members, staff and community.

Likely Major Extreme

(Risk)


No change to budget. Community uncertainty about what is being done to assist.

Measures have been designed with feedback from elected members, staff and community.

Likely Major Extreme

(Risk)

COMMENT

63 It is recommended that Council adopt a new policy in response to current social and economic conditions currently brought about by the coronavirus pandemic. The City is committed to working with ratepayers to effectively manage their payment of property rates, fees and charges in alignment with the City’s social responsibility.

64 The proposed initiatives are for consideration in the preparation of the 2020-21 budget, which will be developed in direct response to the effects of the COVID-19 Pandemic. It may be necessary to include further measures once the true impact of the current crisis is known and a full recovery plan has been developed.

VOTING REQUIREMENT

65 Absolute majority to accommodate the reallocation of funds in the current year budget, in accordance with section 6.8 of the Local Government Act 1995.


Page 20



66 At the workshop held 23 April 2020, Councillor’s expressed a number of further initiatives and alternatives for consideration including alternative and additional projects that could be brought forward as part of strategies for stimulating the economy such as:

Urban Forest Strategy (UFS) – pre-funding and planning the delivery of tree planting targets and completing all auditing works.

Play Provision Strategy (PPS) and associated shade provision – addressing playground renewal demand earlier than originally proposed in the PPS.

Kent Street Weir – consolidating the Staged delivery and bringing forward this project.

Sports Lighting – bringing forward the delivery of future projects, including the completion of design works for all sports lighting projects.

Queens Park Regional Open Space – State Football Centre – bringing forward design funding for the City’s component of this project.

Various other public realm works such as:

Park Signage and Wayfinding – design and construct

Irrigation Upgrades

Exercise Equipment

Drinking Fountains renewals

BBQ renewals

Fencing/gates/bollards renewals

67 With regard to the City’s Waste Management initiatives, a Briefing Paper was provided to Elected Members prior to the 23 April 2020 Workshop, with a number of areas and options discussed at the Workshop as to the impacts of COVID-19. There was also discussion in relation to the City’s recycling contract to which the relevant Tender closed on 24 April 2020. The market’s response to this Tender will be the subject of a further briefing to Elected Members after the Special Council Meeting

68 Given the dynamic nature of the COVID-19 crisis, the City must be prepared to implement a number of phases to its response and recovery. The recommendations within this report are the City’s initial response to COVID-19, with additional response measures likely to be introduced in subsequent phases of response and recovery. The type of responses required and their quantum, can only be fully determined once the full impacts of COVID-19 can be fully evaluated. To this extent comprehensive impact analyses will be undertaken particularly in relation to the social and economic impacts on the Canning Community.

Item CC-015-20 - Attachment 1 Policy FM.13 Financial Hardship

Page 21



Page 22



Page 23



Page 24

CC-016-20 Budget Review as at 31 March 2020 CC-016-20

CC-016-20 Budget Review as at 31 March 2020


SUB PROGRAM: Business Canning

FILE REF: Q20/150


REPORTING OFFICERS: Francis Mammone - Project Officer

Hitesh Attawala - Manager Finance & Asset Management

Steve Leeson - Executive Manager Business Canning



Community Goal: Effective leadership and good governance. Council Strategy: Prudent financial management and long term financial sustainability.

Authority/Discretion: Legislative: Includes adopting Local Laws, Town Planning Schemes and Policies. Review when Council reviews decisions made by Officers.

Attachments: 1. Mid-year Budget Review 2019-2020 Statement of Comprehensive Income and Budget Surplus or Deficit (D20/47552).

2. Mid-year Budget Review 2019-2020 Sub-program Summary With Commentary (D20/47553).

In Brief:

To provide an updated review of the City of Canning’s (‘City’) adopted 2019-2020 Annual Budget. It includes details of considerations likely to have an impact upon the estimated year-end financial position as at 30 June 2020. The report and attachments detail the proposed variations within business units along with revised budget statements proposed for adoption.


That Council:

1. Approves the Budget Review as at 31 March 2020 and endorses the actions proposed within the report.

2. Adopts the Budget Amendments detailed in Attachments 1 and 2 of this report pursuant to Section 6.8 of the Local Government Act 1995.




OCM 17 September 2019 CC-042-19 Budget Review as at 30 August 2019

Adopted

SCM 15 August 2019 CC-040-19 2019-2020 Annual Budget.

Adopted


Page 25


BACKGROUND

1 The City’s 2019-2020 Annual Budget was adopted at a Special Council Meeting on 15 August 2019. The City adopted a budget in that all revenues and expenditures including capital works, external grants, debt funding, and the application of reserves would result in a balanced budget for the year ending 30 June 2020.

2 The 2019-2020 Annual Budget is consistent with the previous 2016-2017, 2017-2018 and 2018-2019 budgets, in that no prior year surplus funds were included to offset the current year’s operations. As per the City’s Long Term Financial Plan 2017-2027 and Council Policy FM.05 Budget Preparation any surplus funds are to be transferred to reserves as part of the annual reporting process.

3 Consistent with previous year budgets all prior year carry forward projects were also excluded from the adopted 2019-2020 Budget, pending further review and confirmation of any amounts necessary for project completion. Carry over projects were adopted by Council on 17 September 2019 in report CC-042-19 Budget Review as at 30 August 2019.

4 After allowing for the financial assistance grant received in advance and carry forward projects, there was a net deficit of $2,076,531 for the 2018-2019 financial year. Being a cash deficit, these funds will need to be recouped in later years through savings and or reserve transfers.

5 It is recognised the annual budget is an informed financial forecast and variations are to be expected. Actual circumstances experienced may differ to initial estimates provided. Limited delegation is available under Council Policy FM06 Budget Variation for City Officers to manage and accommodate variations which may arise in meeting service operations, and the delivery of annual objectives. The policy provides direction for increases in expenditure on existing line items that are:

a) Accommodated within a Business Unit.

b) Not accommodated within a Business Unit.

6 Council Policy FM.06 Budget Variation also establishes the reporting process to be followed. Variations in budget line items which have been authorised under Policy are included within subsequent budget review reports. Only materially significant amounts are reported. The City’s 2019-2020 adopted variance reporting percentage is 10% or $50,000 (whichever is the greater) for the year ending 30 June 2020.

7 Council is required to undertake a review of its budget at least annually. A more frequent budget review process has been practiced by the City which addresses on a timely basis:

a) Any change in the estimated year end position.

b) Broader impacts upon funding.

c) Abnormal items of expenditure.

d) Changes for individual service needs, including the ongoing Capital Works Program.

8 The consolidated approach also reduces the need for separate reporting to Council of individual items.

9 Budget reviews are forwarded to the Department of Local Government, Sport and Cultural Industries in accordance with legislative requirements.

10 Figures quoted within this report may have been rounded.

DETAILS

Initial Review

11 The initial and routine mid-year budget review was undertaken using the City’s OneCouncil Enterprise Management Solution. For the first time, staff have used online system based budgeting software to review and reforecast the 2019-2020 Annual Budget.


Page 26


12 The new system’s reporting enables reporting across various classifications of City revenues and expenditures. Traditionally, the City’s reporting has been based upon the LGA Financial Management Regulations classifications of by Program and by Nature or Type. OneCouncil more easily accounts for the City’s program and sub-program organisational structure that better aligns with service delivery which is more easily understood.

13 Major variances in sub-program budgets forecasts (>$50,000) are detailed within the attachments. A summary overview of variances is as follows:

Changes to Surplus through Audit $(54,701)

14 Audit change required increasing operating expenditure.

Increased Operating Expenses $(900,046)

15 Adopted budget omitted street tree pruning and removal costs $150,000. Sports field lighting capital reclassed as operating $150,000. Savings on employee costs $412,000. Increased legal expense budget $500,000. Workers compensation adjustment cost $172,000. Additional utilities expenditure $222,000. Additional election expenses $40,000. Additional properties meeting non-rateable status $40,000. Increased events expenses $50,000.

Decreased Operating Income $(285,777)

16 Less rates income Carousel $394,000 Brownlie Towers $148,000. Less interest earnings $225,000. Additional general purpose operating grant received $50,000. Insurance rebate $173,000. Welshpool Business Enterprise Centre proceeds $290,000. Reduced care services fee revenue $30,000.

17 As the loss of Brownlie Towers rates income and interest earnings represents a permanent reduction in future City revenues, an exercise requiring a corresponding reduction in operating expenditures across all sub-programs was undertaken.

Increased Capital Grant Income $2,922,512

18 City Centre grants Public Transport Authority $2M and Metropolitan Local Road Fund $973,000. Less road grant funding $300,000.

Decreased Proceeds from Sale Assets $(4,128,019)

19 Previously intended as carry over projects, instead re-budgeted in 2019-2020 mistakenly duplicating sale of Queens Park Library $3.44M and Marquis Street $650,000. Offset by reduction in transfer to reserve.

Increased Capital Expenditure $(4,123,988)

20 City Centre reserve and grant funded works $3.4M. Hillview Place $1.9M. Centenary Park additional works $330,000. Less Canning Lodge building works not proceeding $1.2M.

Incoming / (Outgoing) Retirement Village $(971,000)

21 Repayment of capital entry fees to outgoing residents.

Decreased New Loan Funds $1,220,001

22 Canning Lodge project deferred, loan funds not required.

Increased Transfers from Reserves & Other Funds $4,366,489

23 To fund legal fees $500,000, Hillview Place $1.9M, Centenary Park $330,000, Bannister Park $250,000, City Centre works $500,000, Workers compensation $172,000, Leisureplex works $90,000, Retirement Villages $971,000.

Decreased Transfers to Reserves & Other Funds $3,530,470

24 Reduced by duplication of Queens Park Library and Marquis Street sales.


Page 27


Subsequent COVID-19 Budget Review

25 The City has acknowledged the significant impact associated with the COVID-19 pandemic. Implementing community spread mitigation strategies in line with Commonwealth and State Government public health mandates, has seriously impacted upon the City’s service delivery, revenues and expenditures.

26 The City’s measures include so far:

a) Closure of both Leisureplexes, all Libraries, and Whaleback Golf Course;

b) Closure of all outdoor play equipment, skate and BMX parks;

c) Cancellation of the remaining Events program;

d) Lockdown of Canning Lodge Aged Care Facility;

e) Increased cleaning regime;

27 Further major variances in sub-program budgets forecasts (>$50,000) in response to COVID-19 which are already included within the attachments, are summarised as follows:

Closure of Services $(1,856,985)

28 Leisure services foregone revenue $(2,352,418) and reduced operating expenditure $715,964.

29 Library service reduced operating expenditure $60,000.

30 Community and Business support through concession on health inspections and penalty interest $(50,000).

31 Business, community groups and sporting club support through concession on leasing charges $(159,225).

Review of Projects $1,636,768

32 Cancelled operating projects in response to COVID-19 and considered no longer necessary $823,629.

33 Deferred capital projects in response to COVID-19 that are unlikely to be completed by 30 June and can be rescheduled $813,139.

Review of Reserve Transfers $1,475,000

34 Withholding transfers to reserves for interest $175,000 and annual allocations $1,300,000 to partially offset 2019-2020 operating service deficits and 2018-2019 annual deficit.

CONSIDERATIONS

Legal Compliance

35 Section 6.8 of the Local Government Act 1995 Expenditure from Municipal Fund not included in annual budget.

36 (1) A Local Government is not to incur expenditure from its Municipal Fund for an additional purpose except where the expenditure —

(a) is incurred in a financial year before the adoption of the annual budget by the Local Government;

37 In reference to mid-year Budget Reviews, Local Government (Financial Management) Regulation 33A states the following:

i) Between 1 January and 31 March in each year a Local Government is to carry out a review of its annual budget for that year.

ii) Within 30 days after a review of the annual budget of a Local Government is carried out, it is to be submitted to the Council.


Page 28


iii) A Council is to consider a review submitted to it, and is to determine* whether or not to adopt the review, any parts of the review, or any recommendations made in the review. *Absolute majority required.

iv) Within 30 days after a Council has made a determination, a copy of the review and determination is to be provided to the Department.

Policy Implications

38 FM.05 Budget Preparation Policy.

FM.06 Budget Variations Policy.


Business Plan

39 Business Canning

Financial Reporting:

a) To prepare the City’s Annual Report, Annual Budget, and Long Term Financial Plan. b) To oversee acquittals for external agencies. c) To prepare the City’s accounts for audit.

Internal Budget

40 A summary table below is provided to indicate the impact upon the current year’s budget and any revised year end forecast.

Budget Item $000’

Adopted Budget Opening Surplus / (Deficit) (2,077)

Changes to Surplus after Audit (55)

Decreased Operating Expenses 1,467

Decreased Operating Revenue (3,630)

Increased Capital Grant Income 3,278

Decrease Proceeds from Sale of Assets (4,128)

Increased Capital Expenditure (5,966)

Incoming/(Outgoing) Retirement Village (971)

Decrease New Loan Funds (1,220)

Increase Transfers from Reserves & Other Funds 5,335

Decrease Transfers from Reserves & Other Funds 6,982

Net revised deficit $(984)

41 The budget review considerations addressed under Details and Internal Budget above, are included within Attachments to this report. A revised Statement of Comprehensive Income and a Statement of Budget Surplus or Deficit for the year ending 30 June 2020 recommended for adoption, is included as Attachment 1 and a Sub-program summary with commentary is included as Attachment 2.

Asset Management

42 Not applicable.


Page 29



43 The new Sustainability Policy was adopted 18 June 2019. The City is now working towards determining a set of City wide targets, which will provide measurable criteria for sustainability progress assessment.

44 In advance of these targets having been developed by the City and endorsed by Council this project addresses Sustainability Policy CM194 commitments numbered;

(3) A commitment to responsible resource management and impact reduction.

45 Budget implications addressed as part of the review process may impact upon future years’ budget considerations. The City’s Long Term Financial Plan is being revised and will include consideration towards addressing the 2018-2019 budget deficit.

Consultation 46 The budget review is undertaken in collaboration across City management.



Actions Consequence

Likelihood X

Consequence Rating



Better forecasting of budget and performance. Compliance with LGA Reg 33A.

Budget estimates revised.

Almost Certain Moderate High

(Opportunity)


Certain community expectations may not be met due to budget amendments.

Changes are communicated to the public through the budget report.

Possible Minor Medium

(Risk)


Delay in funding certain projects.

Review of City budgets (internally and with external consultation).

Likely Moderate High (Risk)


May prevent the City from continuing some projects in a timely manner.

Review of City budgets (internally and with external consultation).

Likely Significant High (Risk)

COMMENT

47 It should be noted that this report only provides an indicative estimate of year end surplus from budgeted activities. Other savings and shortfalls may eventuate during the remaining financial year, therefore affecting the estimates shown may in turn impact on the estimated 2019-2020 projected final year end surplus position.

48 A reconciliation of grant revenues against projects over previous years has identified an inaccuracy in the numbers registered and carried forward into subsequent budgets. Grant funding which will not be forthcoming has required an adjustment of $300,000.


Page 30


49 Further progress on the City’s Whaleback Golf Course Masterplan has been temporarily put on hold due to the more immediate needs of COVID-19. One component of the master plans considerations is the renewal of greens. To better determine a project estimate for any course renewal works, a trial is proposed to rebuild the third green. This green is currently the worst green on the course. The existing turf was laid 40 years ago and now has multiple grass varieties present that are considered well below public golf course standards. It is proposed these works be undertaken in-house by the golf course maintenance team at a project cost of $30,000 to be funded from the Whaleback Golf Course Reserve. Whilst the course is currently closed to the public, it would be an ideal time to undertaking these trial works. The revised financial statements include the project and funding as part of the budget review.

50 The project would include:

a) Removal of old turf and topsoil.

b) Lay new sand.

c) Complete earthworks shaping up the new green surface.

d) Establish new green grown from seed (time frame 12 to 16 weeks to establish putting surface depending on weather conditions, soil temp etc.).

51 The budget measures included within this report and the attached revised financial statements address the COVID-19 impact upon current City service delivery changes. Further revisions have necessarily halved the brought forward 2018-2019 deficit, through reductions in operating and capital expenditures along with reduced transfers to reserves.

VOTING REQUIREMENT

52 Absolute majority (as defined in s6.8 (1) (b) of the Local Government Act 1995).


53 Not applicable.

Item CC-016-20 - Attachment 1 Mid-year Budget Review 2019-2020 Statement of Comprehensive Income and Budget Surplus or Deficit

Page 31


Item CC-016-20 - Attachment 2 Mid-year Budget Review 2019-2020 Sub-program Summary With Commentary

Page 32



Page 33



Page 34



Page 35



Page 36



Page 37

NOM-004-20 Establishment of COVID-19 Recovery Coordination Group NOM-004-20

7. MOTIONS OF WHICH PREVIOUS NOTICE HAS BEEN GIVEN

NOM-004-20 Establishment of COVID-19 Recovery Coordination Group

FILE REF: Q20/160



ATTACHMENTS Nil.

In accordance with Clause 4.13 of the City of Canning Standing Orders Local Law 2015, Mayor Patrick Hall and Deputy Mayor Jacobs have submitted the following Notice of Motion:

NOTICE OF MOTION

That Council:

1. In response to the COVID-19 pandemic, endorses the establishment of the Local Recovery Coordination Group in accordance with the City of Canning Local Recovery Plan, as endorsed by Council at the June 2018 Ordinary Council Meeting.

2. Appoints the Mayor as the Chairperson of the Recovery Coordination Group and appoints the Deputy Mayor and Cr ____________ as members of the group with the Deputy Mayor appointed as the Deputy Chairperson.

3. Appoints the Chief Executive Officer and the City’s designated Recovery Coordinator as members of the Recovery Coordination Group.

4. Subsequent to the first meeting of the Recovery Coordination Group, requests the CEO to report back to Council on the requirement for the establishment of Community Reference Groups, and where appropriate seek Elected Member nominations to participate in and/or chair those groups.

5. Requests the Chief Executive Officer to commence the preparation of the City’s Draft Operational (Community) Recovery Plan and provide regular updates to Council on its progress prior to being presented for adoption.

6. Establishes a schedule of COVID-19 Special Council Meetings in order to receive updates on the impacts of COVID-19, deal with recommendations from the Recovery Coordination Group and make decisions in relation to the City’s COVID-19 Response and Recovery, with such meetings being no more than one month apart.


Page 38


RATIONALE

1 The City of Canning has managed its response to the COVID-019 crisis well to this point and whilst the response phase may continue for a long period of time, the impacts have been far reaching and will continue to be so for some time. This is an international health, economic, and humanitarian crisis we are facing and needs a meaningful and seamless approach that can address any contingency that may arise in a relatively quick time frame.

2 Elected Members need to take a proactive leadership approach to addressing the issues being felt by our community and in leading the transition to recovery.

3 Council has previously endorsed the City’s Local Emergency Management Arrangements including the Local Recovery Plan and under these arrangements, Elected Member representation is needed on the Local Recovery Coordination Group and in being the conduit between the City and the local community.

4 Once the Recovery Coordination Group and the Community Reference Groups have been established, it is important that Council remains informed of the issues and impacts being felt by our Community and is able to make timely, informed decisions on how best to deal with them. Therefore, it is important that we make the time to discuss these issues outside of the ordinary business of Council and therefore, I am recommending regular Special Council Meetings be held specifically for this purpose.

OFFICER COMMENT

Local Emergency Management Arrangements

5 This motion is supported as it is mostly consistent with the Local Emergency Management Arrangements adopted by Council in June 2018 and provides for the establishment of the appropriate groups with Elected Member representation.

6 The Emergency Management Act 2005 (‘the Act’) dictates a number of tasks to Local Government in relation to planning, preparedness, response and recovery to emergency events. The development, review and exercising of Local Emergency Management Arrangements (LEMA) is a key requirement of the City.

7 The LEMA refers to the collection of all emergency management documentation, systems, processes and agreements which affect the Local Government district. The LEMA outlines roles and responsibilities to enable support to Hazard Management Agencies in times of an emergency, as well as community evacuation and recovery arrangements.

8 The City’s LEMA are supported by the Department of Communities Emergency Welfare Plan for the Cannington District and State Hazard Management Plans.

9 The State Emergency Management Committee (SEMC) approval process requires the LEMA to be endorsed by the Local Emergency Management Committee (LEMC) and the Local Government, prior to being submitted to the SEMC for noting.

10 The Canning/South Perth LEMC endorsed the City of Canning’s LEMA at the 6 February 2018 meeting. With the City’s Local Emergency Management Arrangement endorsed by Council at the 19 June 2018 Ordinary Council Meeting. This included the City’s Emergency Management Handbook and the Local Recovery Plan.

Local Recovery Coordination Group

11 The LRP incorporates the Local Recovery Coordination Group (LRCG). The role of the LRCG is to coordinate and support local management of recovery processes within the community. The City’s Local Recovery Plan (LRP) as contained in the LEMA addresses a legislative responsibility under section 36 and 41 of the Act.

https://www.legislation.wa.gov.au/legislation/statutes.nsf/law_a9384.html


Page 39


12 The role of Local Government under this Act is to: a) Ensure that a Local Recovery Plan for its district is prepared, maintained and tested [EM Act

s.41(4)]; b) Appoint a Local Recovery Coordinator(s) [EM Act s.41(4)]; c) Chair the LRCG; d) Provide secretariat and administrative support to the LRCG, as required; e) Provide other representatives to the LRCG or its subcommittees, as appropriate to the

emergency (eg Building Surveyor, Environmental Health Officer, Community Services); and; f) Ensure the restoration/reconstruction of services/facilities normally provided by the local

government.

13 In accordance with the Local Recovery Guidelines (SEMC), depending upon the extent of the restoration and reconstruction required, the Local Recovery Coordinator and Local Recovery Coordination Group should develop a specific recovery plan setting out the recovery process to be implemented.

14 In the LRP, the designated Chairperson of the LRCG is the CEO, however, if the Mayor is appointed to this Group, he would assume this position, the Director Canning Community and Commercial as the Local Recovery Coordinator and the Director of Sustainable Development and Director Canning Environment as deputies. The people in these positions have attended accredited Emergency Recovery Training. During the emergency, the Local Recovery Coordinator is responsible for liaising with the Controlling Agency and participating in the incident management arrangements; and ensuring the local arrangements are established.

15 Also in accordance with the SEMC guidelines, the role of the Local Recovery Coordination Group is to coordinate and support local management of the recovery processes within the community in conjunction with the Local Recovery Coordinator. Local Recovery Coordination Group Subcommittees are established where required based on expertise and resources required at that time.

16 The City’s Local Recovery Coordination Group as established under these arrangements provides for the representation of (an) Elected Member(s) as well as representatives from agencies that provide specific services to the community (if required).

17 Once the Recovery Coordination Group has been established, a determination can be made as to what further groups and internal subcommittees are required in order to ensure community-led recovery. In most recovery scenarios, four areas of recovery are focused on being: the Built Environment; the Natural Environment; the Social Environment; and the Economic Environment. Given the current situation has arisen because of a Pandemic, it is expected that the majority of the recovery work will be focussed in two areas - being Social Environment and Economic Environment. As such, an example of the reporting structure that may be apparent is shown below:


Page 40



18 Not applicable.


Page 41

8. CLOSURE

agenda of special council - 30 april 2020€¦ · 30-04-2020 · special council meeting agenda 30...

Documents