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Wednesday, August 10, 2022
Deloitte service review outlines $1M in savings, new revenue for town

Parking and user fees, improved procurement among suggestions by consulting firm


A 104-page report by consulting firm Deloitte shows that while there is “room for improvement,” the town is “doing a great job” in delivering services to residents, NOTL's chief administrator says.

The document outlines suggestions to boost municipal coffers by almost $1 million a year, mainly through parking and user fees, streamlining purchasing practices and eliminating lost water revenue.

Interim CAO Sheldon Randall said the $218,000 study confirmed the town needs “to make more investments regarding data acquisition, analysis, and reporting.” 

“We have to be able to gauge, with effective data, where we’ve been, where we are, and where we want to be,” Randall told The Lake Report.

The report was conducted under and paid for by the Ontario government’s Municipal Modernization program, which allocated $125 million to help 405 small and rural municipalities conduct service delivery reviews and implement recommendations.

The town received $725,000 under the modernization program, but has only spent $218,000 of it so far.

Deloitte identified 53 “opportunities for improvement” of which 42 can be implemented by the end of 2022, according to a report to council by Randall and project liaison official Bobbie-Joe Talarico.

The Deloitte report, presented at council's June 22 meeting, acknowledges the COVID-19 pandemic likely will curb some of its revenue estimates. (Read the full report online via a link under “Committee Reports” on the June 22 meeting's agenda.)

However, it projects that implementing the top recommendations and some of the secondary suggestions could save Niagara-on-the-Lake taxpayers almost $1 million a year by 2022 through increased revenue and reduced expenses.

“Deloitte recognized that an annual review of parking operations to consider surge pricing during seasonal times” could boost the town’s finances, Randall said.

As well, “There is an opportunity for the town to institute and periodically review a revenue policy for facilities, parks, special events and programs that generate user fees.”

At the outset, the town said it was looking for improvements that reflected its strategic priorities, were fiscally responsible and met “the expectations of residents,” Randall and Talarico said in their report to council.

Among the top areas identified by Deloitte with the most significant financial impact by 2022 are:

* Saving $365,000 or more by reviewing parking operations and inventory annually and to plan parking “supply” to accommodate tourists during high-demand seasons.

* Raising $150,000 a year by instituting a revenue policy for user fees for town services.

* Saving $275,000 annually by completing the final phases of a water audit.

* Saving about $250,000 a year by improving the municipality’s purchasing practices.

* Hiring a full-time employee at a cost of about $85,000 a year to manage procurement to “centralize purchases,  eliminate redundancies in ordering and reduce challenges in capacity.”

As well, hiring a full-time chief administrator should be a priority, Deloitte concluded. Randall has filled the job on an interim basis since former CAO Holly Dowd retired in  2019. 

None of the report's recommendations have been approved by council, Randall said. Approval is “dependent on the new CAO and council. They will determine the best way to navigate the opportunities, which ones to implement and when.”

Randall noted the Deloitte review “identified a total of 53 opportunities for improvement. Each of the 53 opportunities will benefit the town in one or more ways in that it will drive a quantified financial impact, improve services or operational efficiencies and lay a strong foundation for improvement.”

The report also will help the town focus on setting priorities and reduce costs “while maintaining or improving service levels. It’s all about making informed, strategic choices,” he said.

The consultants also said the town needs an enterprise risk management policy to  guide its decision-making processes, should adopt integrated IT solutions to improve efficiencies  and use key performance indicators (KPIs) for a data-driven approach to operations. 

The report also recommends hiring a full-time employee to manage drainage and irrigation. 

As well, establishing a full-time staff position for special events is suggested, to “increase efficiencies” and generate user fees. Randall and Talarico said a business case for the special events job will be presented to council for 2021 budget approval.

None of the recommendations have been approved by council, Randall said in response to questions from The Lake Report.

“Staff will be looking into which recommendations don’t require approval from council that they can move forward on. Those that require approval from council will be on hold until a full-time CAO is appointed.”

Some of the opportunities to be handled internally include: 

* Improving the high staff turnover rate among customer service workers in the clerk’s department.

* Modernizing the planning and building application process by eliminating paper-based processes.

* Redefining communications and community engagement under a formal communications officer position.

* Revising job processes and job descriptions to reflect internal growth and changes.

* Improving internal training and cross-training staff to manage absences and provide backup support.

* Relying on volunteers or low-cost  employees  to supplement  staffing  at the community centre, which is constrained as it operates with only three full-time and two contract staff.

* Standardizing the water meter installation process to boost revenue.

Randall noted Deloitte estimated the cash flow operating and capital implications of “five opportunities and the cost implications of another three opportunities. They expect other opportunities to generate financial benefits, but cannot estimate their impacts given the wide range of possible variables and outcomes.”

“The quantified opportunities could improve the financial position by just under $1 million (4 per cent of 2018 operating budget) per annum (or $1.9M between 2020 and 2022) with minimal capital investment required to implement them. Staff will need to take a second look at these numbers once the constraints surrounding COVID-19 are resolved to determine if this is achievable and realistic,” he said.

As part of its review, Deloitte examined past economic, strategic plan, community wellness and budget surveys, and a customer experience survey that attracted 34 respondents, Randall said. Two open houses were also held: one for residents had only six participants and one for business and developers drew four participants.