Financial concerns took centre stage as Kelowna city council deliberated the final iteration of the 10-Year Capital Plan during a meeting on Monday, Nov. 22.
Several financial impacts have caused cost and timing changes for some of the funded projects and unfunded projects outlined in the plan. These include the continued financial impacts of the COVID-19 pandemic, construction and land cost escalation, community demand for more and enhanced services and replacement of aging infrastructure, among others.
Overall, the city’s infrastructure investment has increased by $98 million from the previous plan across 12 capital cost centres. In particular, costs for building rose by $35 million due to cost increases for the Parkinson Recreation Centre replacement.
Timing has also been adjusted for nine parks, transportation and airport projects. Three projects will be occurring sooner and six will be occurring later than expected. These adjustments were made to reflect available investments and changing community needs, according to a city staff report.
Funding for unfunded infrastructure has decreased by $91 million compared to the previous plan. The decrease was made by deferring major projects beyond the 2030 timeframe. Additionally, the transit operations and maintenance facility has been transferred to the operating budget. These changes impact six unfunded projects in three cost centres, totalling $166.4 million.
Overall, the infrastructure deficit has increased 11 per cent since the last update from $388 million to $430 million. This is not unexpected due to widespread cost increases across many sectors, according to the city staff report.
“The proposed infrastructure is a critical component for Kelowna to be well-positioned to recover and emerge stronger, after the COVID-19 pandemic. The 2020 Citizen Satisfaction Survey indicates 91 per cent of citizens are satisfied with the overall level and quality of city services,” wrote city staff in their report.
The final report was reviewed and adopted unanimously by city council on Monday, allowing staff to use it as a guide as part of the city’s annual budgeting process. The plan is a forecast of infrastructure development for the city, as the approval of the project occurs during the annual budget process.