2008/2009 CAPITAL WORKS BUDGET WATER & WASTE – 2ND … · 2nd Budget Review 2008/09 Variance $ Variance % Comments Wastewater $150,080,455 $136,186,594 $13,893,861 11% Reductions:

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Agenda – Finance & Administration Committee 18/3/09 - #1989789

FINANCE & ADMINISTRATION COMMITTEE

18 MARCH 2009

11 2008/2009 CAPITAL WORKS BUDGET WATER & WASTE – 2ND REVIEW FEBRUARY 2009 Lauren Pearse: #1985100v2

RECOMMENDATION: That Council adopt the funding variations to the 2008/2009 Water & Waste Capital Works Program for projects listed in this report.

INTRODUCTION:

This report provides a summary of the second review of the Water and Waste Department’s 2008/09 Capital Works Program undertaken in February 2009. The following tables provide a summary for:

• The revised capital budget by branch • The revised source of funds as a result of these budget changes.

The total source of funds (SOF) per this report is $3,416,979 less than the SOF supplied by Corporate Finance due to late adjustments to some projects. These adjustments are a result of new information that means the projects will not be completed by 30 June 2009. These projects are primarily the construction costs of reservoirs at Fishery Falls, Bartle Frere and Bellenden Kerr, and have been deferred into future years.

Table 1: Revised 2008-2009 Capital Budget by branch, (including adjustment for carried forward funding)

Description

1st Budget Review 2008/09

2nd Budget Review 2008/09

Variance $ Variance % Comments

Wastewater $150,080,455 $136,186,594 $13,893,861 11%

Reductions: • Bramston Beach Integrated

Water Management Scheme hasbeen deferred to the next year - $5.8m

• Cleaner Seas project which will fall into the next year (based on cashflow projections) - $8.9m

• Augmentation of Riverstone Road Trunk Sewer - $200k

• Sewer Relining Program - $200kIncreases:

• Southern WWTP Outfall Pump Station bends - $137k

• Upgrades of pump stations - $883k

• Port Douglas WWTP upgrade - $108k

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Water $10,431,846 $11,339,238 -$907,392 -8%

Reductions: • Fluoride Planning Report - $180k• Mulgrave River Crossing for old

Behana main - $170k • Isabella Road Trunk water main

extension - $100k • Walker Road Trunk Main

extension - $308k. Increases:

• Uni reservoir dedicated inlet main - $500k

• Aumuller St Water Main Relocation - $332k

• Water Leak Detection - $240k

Waste $1,498,771 $1,502,146 -$3,375 0%

Decreases: • Upgrade of Programmable Logic

Control system at the MRF - $100

• Upgrade of Stage 1 Equipment at the MRF (delayed pending findings of efficiency audit) - $160k

• Upgrade of Leachate Pumps at Portsmith Transfer Station - $45k

• Leachate Storage Tank for drop bin sites - $37k.

Increases: • Sealing of the product storage

area of the MRF - $110 • Construction of a Bund Wall at

Killaloe Landfill to meet EPA requirements - $160k

• Investigation and planning works for the Portsmith Landfill Remediation - $95k

Total $162,011,072 $149,027,977 $12,983,095 9% Note: WWTP is the Waste Water Treatment Plant MRF is the Materials Recovery Facility

Table 2: Revised 2008-2009 Source of Funds.

Source of funds

1st Budget Review 2008/09

2nd Budget Review 2008/09 Variance $ Variance % Comments

Loan Funding $86,447,773 $82,455,020 $3,992,753 5%

Decrease due to deferral of the Bramston Beach Integrated Water Management scheme and Cleaner Seas Budgets into the next financial year, meaning less loan funding required this year.

Grant Funding (approved and unapproved)

$55,940,935 $49,963,038 $5,977,897 12%

Reduction in grant funding due to deferral of Bramston Beach IWS scheme budget and Cleaner Seas Project budget.

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Clean Seas

Reserve $8,173,082 $8,173,082 $0 0%No change, based on anticipated levy to be charged for the year.

Infrastructure Agreements $352,291 $112,291 $240,000 214%

Reduction due to deferral of the Walker Road Trunk Main extension.

Developer Contributions $8,346,420 $6,218,648 $2,127,772 34%

Budget movements to cover the cost of renewal projects necessitated the reduction in some projects that were available for Developer Contribution funding. A decrease in Bramston Beach IWS scheme budget also reflected in decreased developer contributions.

Revenue Funding $2,750,571 $2,105,898 $644,673 31%

Decrease in overall budget and therefore decrease in projects requiring revenue funding.

Total Source of Funds

$162,011,072

$149,027,977 $12,983,095 9%

BACKGROUND The Management Accountant, in consultation with the Manager Infrastructure and the Executive Engineer Project Delivery, maintains and monitors the capital budget for Water & Waste on a regular basis. The budgetary changes contained within this report have been made in consultation with Manager Infrastructure and Financial Services. CONSIDERATIONS Corporate and Operational Plans: This report links into: 1. Corporate Plan - Key Goal No. 10, Governance,

a. 10.3. Effective strategy setting, deployment, monitoring and reporting.

2. Corporate Plan – Key Goal 5, Our water supply a. 5.1 Secure and timely access to additional quality sources of water, with

sources secured with minimal harm to the natural environment b. 5.2 Increased local reservoir and water treatment capacity, maintaining the

quality of both the water and the service provided c. 5.4 A more robust and secure water supply system that includes a lower level of

water loss through leakage

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3. Corporate Plan – Key Goal 4, Caring for the environment

a. 4.3 Further Improvement From an Environmental Perspective in the Treatment & Disposal of Household & Commercial Waste: Reduce, Reuse and Recycle

b. 4.5 Further improvement in the treatment of wastewater to achieve quality

standards recommended by the Qld Coastal Management Plan, & examination of reuse options where available & potentially financially and technically viable

4. Operational Plan - Infrastructure Management – Level of Service for the quarterly

review of the current Capital Works Program.

Financial: As detailed in this report: Refer to appendix A – Revised budget and budgeted source of funds (by project) – 2nd Review 2008/2009 Sustainability: Water & Waste has a view to ensuring projects consider long-term sustainability to cope with current and future growth that Cairns is expected to experience. Projects are considered in terms of environmental, social and economical impact and sustainability.

CONSULTATION: The following staff have been consulted during the 2nd capital budget review: General Manager, Water & Waste Manager Infrastructure, Water & Waste Executive Engineer – Project Manager, Water & Waste Manager Operations, Water & Waste Manager Business Services, Water & Waste

CONCLUSION: It is recommended that Council: 1. Adopt the source of funds variations to the 2008/2009 Water & Waste Capital Works

Program for projects listed in this report and the attached schedules. 2. Vary the 2008/2009 Capital Works Budget accordingly.

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ATTACHMENTS: Documents #’s:

- Appendix A – Budget Review 2 08/09 incorporating budgeted source of funds. - (documents held within DM5 doc#1912281 & doc#1985100)

Lauren Pearse Principal Management Accountant Jon Turner Manager Infrastructure Bruce Gardiner General Manager Water & Waste

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