Unforeseen issues this year forced city council to approve more than $2 million in speculated unbudgeted projects, an analysis suggests, although city hall’s finance director disputes some of the findings.
The Moose Jaw Express reviewed every council report from January to November to determine which ones involved city administration asking for money for projects that were either unbudgeted or unforeseen and needed to be addressed. The initial analysis suggested 22 such requests had not been included in the 2021 budget or required money from reserve accounts — essentially, savings — to complete the initiatives.
That number then shrank to 15 projects after a discussion about the analysis with finance director Brian Acker.
Financial analysis
From January to November, council approved 15 projects worth $2,122,587.08 that were not budgeted this year or unforeseen and needed to be addressed. Since a one-per-cent tax increase this year was valued at $303,926, council would have had to raise taxes by 6.98 per cent to cover these extra costs.
Among these unforeseen projects approved this year were five unbudgeted initiatives for Mosaic Place. Without its subsidy, the venue received $489,238.56 to cover those projects. With the subsidy of $960,656, the building received $1,440,606.56 in total financial support.
Unbudgeted/unforeseen projects
January
One unbudgeted project in January was the purchase of a trench cage. The original budget was $25,000, but city hall asked for an extra $14,993.59 since the tender came in over budget.
This was additional funding since it was over the city manager’s approval limit of 10 per cent of the original budget, explained Acker. The funding came from savings and the reallocation of budget money.
A second unbudgeted request was $45,000 to complete repairs to the Moose Jaw Museum and Art Gallery’s humidifiers and $56,525 to complete change room upgrades at the Kinsmen Sportsplex.
Both projects came in over budget, so the parks and recreation department asked for funding from other accounts to be reallocated to these projects, said Acker.
February
In February, council approved $832,032 to rehabilitate the Seventh Avenue Southwest bridge, closed to traffic since 2015 after an ice flood damaged it. This work included installing steel piles and pile caps to ensure the bridge could handle increased vehicle traffic.
Council paid for this project using funding from the land development reserve, which has about $20 million in it, Acker said.
April
In April, Mosaic Place — via Spectra Venue Management Services — asked for money to address four capital projects worth $33,940, including a contingency of $3,000. The four projects included enhancing an internal communications system, upgrading a security door in the media booth, creating a new staff entrance and moving curling-related water equipment elsewhere.
“Yes, they had an extra request … . There was moneys carried forward in the capital budget again, so they utilized that to fund that,” said Acker.
May
In May council approved a motion to hire a consultant for $26,500 to develop a climate action plan. The consultant would also identify and assist city hall with submitting federal and provincial funding programs applications.
This funding came from a capital project account in the parks and recreation department budget, said Acker. The department would have asked council to reallocate funding from one area to this initiative.
Meanwhile, Spectra provided a report in May about Mosaic Place’s 2021 budget. Spectra noted that it paid out $145,724 in gift cards to people who had been affected by the Ticket Rocket fiasco in 2019 and 2020.
An email from city hall to the Express later indicated that $9,288 in gift cards had been issued this year. During the conversation with Acker, he indiciated that Mosaic Place — a publicly funded venue — would cover the cost of these gift cards.
June
Spectra returned in June asking for $15,000 to finish Mosaic Place’s $141,000 information technology (IT) network renewal project. The network was considered “antiquated” since it was 10 years old and did not meet the building’s needs.
Funding came from an equipment reserve — savings — account, which accrues based on the depreciation of gear, said Acker.
Council approved another motion that month to spend $34,308 to upgrade council chambers with a new Microsoft TEAMS System. This gear would enhance the chambers’ audio/visual system due to the challenges of the pandemic and crowd-size restrictions in the room.
“No, there wouldn’t be a specific budget for it, but in reality, it was budgeted in a previous year because that’s how you get this excess moneys, like in equipment reserve,” he continued. “So it isn’t like it was money that was totally out of the blue … but it is an increased cost that we’re able to utilize the reserve to cover.”
Another project that month saw council authorize the transfer of $400,000 from one account to another to complete the Wellesley Park lift station project. The project budget was $1.75 million. However, the tender bid, change orders and contingency funding increased the cost to $2.12 million, leaving a deficit of $391,826.16.
July
Council approved a request from the engineering department in July for $150,000 to complete upgrades to two intersections. The department budgeted $1.15 million in 2021 for intersection upgrades, but the contract value came in at $1.31 million.
This funding came from a transfer of money from other capital project accounts, Acker said.
A second unbudgeted project council approved that month was $14,046 to purchase an accessible lift and change table for the Kinsmen Sportsplex pool family change room. This purchase complemented the new accessible pool lift installed at the lap pool.
This project was funded from the equipment reserve account since it was “totally different thing” than what parks and rec had proposed in its budget, he continued.
August
Spectra Venue returned in August and asked for $150,000 to support start-up costs for providing food and beverage at Mosaic Place. Council had awarded the four-year contract to Spectra in June but was unaware that the company required funding to proceed.
Spectra has used $100,000 of this loan and will repay it in 2022, said Acker.
October
Spectra Venue returned to council — for a fourth time — in October and asked for $275,000 in additional financing to operate Mosaic Place, including paying employees and covering regular expenses.
By Dec. 31, Spectra expected the building to have a cash deficit of $267,323.
“That is budget overage, so that was not budgeted … ,” said Acker. “It certainly was unexpected.”
November
The final unbudgeted initiative that council covered was the mayoral byelection, which cost $59,774. Conducting the election itself cost roughly $51,974 while renting the voting equipment cost $7,800.
