How Barrie pays its share of County of Simcoe capital projects could be on the table during negotiations for a new municipal services management agreement between the two levels of government.
City council gave final approval Nov. 20 to a motion to that effect, advice from Deloitte LLP’s value-for-money service audit report, which was received for information purposes.
The county provides services such as social housing, paramedics, children’s services, Ontario Works and long-term care beds to Barrie, which pays its share for these services, along with a portion of capital expenditures, such as building construction.
It is how the capital portion is paid that Barrie wants to look at changing.
“If we were a family buying a house, we have to pay it back over 10 years as the agreement (with the County of Simcoe) stands,” said Barrie Mayor Alex Nuttall. “What we are considering is being able to stretch out the repayment timeline to match the expected life of the building, similar to how mortgages are structured on family homes.”
He said the potential savings of the funding of capital assets would fluctuate year-to-year, based on the capital projects being undertaken by the county.
Using Barrie’s Rose Street social housing project as one example, Nuttall said there are potential savings of just more than 50 per cent of the current annual costs to the city.
“More than anything, this approach would reduce the massive increases based on the decisions made by the County of Simcoe, allowing the City of Barrie to provide a smoother and more predictable budgeting process for the residents of Barrie,” he said.
Barrie’s annual operating and capital budgets determine property taxes and service levels.
"The city should ensure that any potential changes to the current capital allocation method are formally communicated and documented during meetings with the (County of Simcoe’s) committee of the whole," Deloitte’s audit report reads.
"There is an opportunity to revise the current capital allocation method based on actual capital asset useful life, actual usage of the capital asset by (the) resident municipality, and actual costs incurred, including interest."
Deloitte’s audit report cost the city $45,000 and, as its title says, is to determine if the city is receiving value for the money it pays the county to provide services.
One of its key conclusions is that the county is "compliant with the municipal services management agreement between the City (of Barrie) and the County (of Simcoe) in terms of actual costs allocated for shared services during the past three years (2021, 2022 and 2023)."
However, Nuttall says there are still gaps.
“I believe there are some areas where the City of Barrie is receiving strong investment and service,” Nuttall said.
“There are clearly places that the City of Barrie is underfunded and, quite frankly, ignored. The City of Barrie does not receive adequate funding for children's services as is clearly outlined in the report, alongside an underfunding of long-term care beds for Barrie's seniors," said Nuttall.
“I believe if we asked the public to consider the various services and the prioritization of services, Barrie residents would want increased and adequate funding for seniors and children, right here in Barrie,” he said.
“I remain committed to finding all relevant information to allow Barrie to achieve a strong and fair offering from the county through our negotiations.”
Simcoe County Warden Basil Clarke said the Deloitte review supports the benefits of a partnership between the city and county.
This partnership is mandated by the province.
“Of particular note, Deloitte concluded that the county has delivered quality services at a lower cost than its comparator municipalities for providing paramedic services, community services and social housing,” he said. “These three service areas make up the majority of the operational costs associated with our shared service agreement with the City of Barrie.
“Overall, the findings point to good value for Barrie, which are ultimately Simcoe County taxpayers.”
Clarke said the City of Barrie has some options when it comes to how it pays its capital allocation.
“Barrie staff confirmed during the previous (general committee of) city council meeting (Nov. 13) that the current method and structure of city financing was a recommendation from the City of Barrie,” the warden said.
“The county can confirm that there is nothing in the current shared services agreement that prevents Barrie from securing external debt and amortizing their portion of costs related to capital projects over whatever period the city desires.”
As noted at county council and within the Deloitte report, Clarke said, the county has proposed further options to support Barrie in managing its capital allocation as part of the next shared service agreement, which is currently under renegotiation.
“These changes may support Barrie in their capital budgeting process and would be accounted for in the county’s long-term capital asset management plan and annual budget process,” he added.
Deloitte LLP, a finance and services auditor, also noted that the county has processes in place to monitor third-party vendor compliance against contracts and relevant legislation for the shared services, children’s services, community services and social housing.
The county also complies with the municipal services management agreement between the city and the county in terms of actual grants allocated for shared services during the past three years, states the Deloitte report.
Based on the selected key performance indicators for shared services, Deloitte says the city appears to be a net recipient for paramedic services, community services, social housing and not a net recipient for long-term care and children's services.
Net recipient means the city is receiving more-than-expected levels of service in comparison to the cost-sharing percentage it is paying for, with respect to these services.
For Ontario Works, as costs are based on caseloads, it appears that the City of Barrie is paying costs relative to the direct costs of Ontario Works, Deloitte concluded.
Based on the comparator municipalities and chosen key performance indicators, Deloitte says it appears the County of Simcoe has lower costs for providing paramedic services, community services and social housing, and in between costs for Ontario Works and children’s services.
In addition, it appears that municipally funded long-term care beds are more accessible within the County of Simcoe compared to the Regional Municipality of Waterloo and Wellington County, as they offer a higher number of beds in comparison to their population.
The current cost-sharing methodology used appears to meet the needs of the City of Barrie, Deloitte says, and the city should continue to engage with the county on future types and locations of services to ensure they are adequately meeting the needs of Barrie citizens.
