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From YouTube: Auditor General Committee - June 1, 2023
Description
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A
B
Good
morning
and
welcome
to
the
auditor
general
committee
meeting
I
call
this
auditor
general
committee
meeting
of
Thursday
June
1st
2023
to
order
this
committee
meeting
is
being
convened
by
electronic
means
is
authorized
under
part
14
of
the
procedure
bylaw.
As
such
committee
members
May
participate
in
person
or
by
electronic
means.
If
any
Committee
Member
loses
connection
during
the
voting
process,
we
have
staff
on
hand
to
facilitate
getting
you
back
online
quickly.
While
we
suspended
the
process
contact
information
has
been
circulated
to
you.
Members.
B
The
public
can
view
the
proceedings
via
the
live
stream
and
YouTube
link,
which
will
be
tweeted
out
by
at
Vancity
Clerk
video
of
committee
members
speaking
presentations,
amendments
and
vote
results
will
be
projected
to
viewers
when
available
committee
members
are
reminded
to
please
enable
their
video
to
ensure
quorums
maintained
during
the
meeting
under
section
14.13
of
the
procedure
bylaw.
If
attending
virtually
the
external
members
of
the
committee
can
access
the
speaking
queue
by
clicking
the
raise
hand
icon
on
WebEx
or
raise
your
hand.
B
A
Internal
advisory
committee
member
Sophia
brings
many
years
of
experience.
She's
a
fellow
CPA
who
got
her
CPA
was
one
of
the
the
large
accounting
firms
here
in
Vancouver
and
upon
qualification
moved
into
the
banking
industry,
where
she's
held
a
variety
of
positions
with
one
of
the
country's
major
Banks
as
assistant
vice
president
of
risk
management,
the
vice
president
risk
strategy,
Global
head
of
risk
governance,
the
senior
vice
president
and
chief
auditor,
and
currently
the
chief
risk
officer.
A
B
Welcome
Sophia
great
to
have
you
here,
okay,
so
in
case
of
an
emergency
where
we
need
to
evacuate
the
building,
I'd
like
to
direct
your
attention
to
the
exits.
There
are
two
exits
beyond
the
glass
doors
and
to
the
left.
If
the
glass
doors
are
obstructed.
Please
direct
your
attention
to
the
four
exits
in
this
chamber.
Please
use
the
stairs.
Do
not
use
the
elevator
I'd
also
like
to
highlight
that
there
is
a
defibrillator
located
at
the
end
of
the
hallway
outside
the
council
chamber.
B
We
acknowledge
that
we
are
on
the
NCD
territory,
the
musqueam,
Squamish
and
slay
with
tooth
people.
We
thank
them
for
having
cared
for
this
land
and
continue
to
look
forward
to
working
with
them
in
Partnership,
as
we
continue
to
build
this
great
City
together.
I
also
want
to
take
a
moment
to
recognize
the
immense
contributions
of
the
city
of
Vancouver
staff,
who
work
hard
every
day
to
make
our
city
an
incredible
place
to
live,
work
and
play
clerk,
may
I.
Have
the
roll
call
please?
Yes,.
D
C
B
Thank
you
Clerk
and
before
we
begin,
I
have
some
announcements.
Any
comments
on
the
agenda
item
can
be
sent
to
the
committee
using
the
web
form
on
the
city's
website.
The
link
to
that
form
will
be
tweeted
out
by
at
Vancity.
Clerk
I
also
want
to
note
the
city
of
Vancouver's,
long-standing
commitment
to
equity,
diversity
and
inclusion,
including
utmost
respect
for
all
genders.
I
remind
committees,
members
that
when
addressing
speakers
and
staff,
we
will
avoid
using
gendered
honorifics
and
will
instead
refer
to
the
person
by
first
and
last
name
role
or
title.
B
There
is
one
report
on
today's
agenda
as
well
as
a
motion
to
go
in
camera.
I'd
also
like
to
remind
committee
members
that
if
amendments
are
brought
forward,
they
must
be
submitted
to
the
clerk
in
final
written
form
before
the
Committee
Member
introduces
them.
Please
ensure
the
clerk
has
received
your
amendment
by
emailing
it
directly
to
Tina,
Penny
or
Elise
Stewart,
and
we
will
begin
with
motion
to
go
in
camera
later
today.
The
committee
is
required
to
meet
in
camera
later
today.
The
reason
an
Authority
Under,
The,
Vancouver
Charter,
are
listed
in
the
agenda.
B
Would
someone
like
to
move
a
motion
to
go
in
camera
later
this
afternoon,
moved
by
Dominator
second
by
Montague,
all
in
favor,
say
yay
a
this
motion
carries
unanimously
upon
adjournment
of
the
public
portion
of
today's
meeting.
We
will
take
a
10-minute
recess
to
transition
into
the
in-camera
portion
of
our
meeting,
allowing
sufficient
time
for
staff
to
vacate
the
chamber
next
item
on
the
agenda
is
the
permitting
program
cost
recovery
model.
B
A
Thank
you
chair
good
morning
committee
members
today
my
team
and
I
will
present
the
results
of
our
audit
of
the
city's
permitting
program,
cost
recovery
model
of
the
third
audit,
completed
by
my
new
office,
I
suppose
after
three
audit
reports
this
year,
I
probably
should
stop
referring
to
it
as
new.
The
audit
topic
was
identified
during
the
building
permit
fee
audit
that
was
released
earlier
this
year.
Given
the
broader
implications
of
the
subject,
we
determined
that
there
were
benefits
to
undertaking
an
examination
of
the
city's
permitting
program
fee
model
as
its
own
audit
topic.
A
I
thank
the
general
manager
of
finance
for
her
Department's
cooperation
throughout
the
audit
and
for
a
positive
response
to
the
audit's
eight
recommendations.
I,
look
forward
to
observing
the
implementation
of
the
city's
action
plan
in
the
months
ahead,
also
like
to
acknowledge
the
general
managers
of
Permitting
and
development,
who
are
also
adhered
today.
So
thanks
very
much
for
being
here.
A
The
city's
permitting
program
includes
a
range
of
permit
and
application
types,
including
Building,
Development,
rezoning
and
trades,
and
for
trades
such
as
Plumbing
gas
and
electrical
permits.
The
Vancouver
Charter
gives
the
city
the
authority
to
set
fees
for
permits
under
regulatory
bylaws
and
to
set
fees
for
zoning
applications
through
bylaw
amendments
in
2022,
the
city
received
more
than
37
thousand
building
and
development
related
applications
and
collected
72
million
dollars
in
fees.
A
Three
departments,
DBL
planning
and
Engineering
hold
broad
responsibility
for
the
administration
of
building
and
development
permits
and
rezoning
applications.
The
finance
and
performance
measurement
group
is
responsible
for
maintaining
and
updating
the
cost
recovery
model.
The
cost
recovery
model
is
a
financial
framework
used
to
track
permitting
program
costs
and
fee
revenues
and
into
inform
permit
fee
setting.
A
City
sets
development
and
building
related
permit
fees
to
recover
the
direct
and
indirect
costs
associated
with
administering
the
permitting
program
and
its
services
aiming
for
full
cost
recovery.
The
city
sets
reviews
and
updates
the
schedule
of
fees
annually,
based
on
an
analysis
of
the
forecast
of
Permitting
revenues
and
anticipated
costs
using
the
cost
recovery
model.
A
It's
well
known
that
a
backlog
of
unprocessed
permits
exists
and
that
the
city
is
working
on
reducing
the
backlog,
to
be
clear,
that
wasn't
the
focus
of
this
audit,
but
it's
relevant
to
this
discussion
in
the
sense
that
there's
a
cost
associated
with
completing
unprocessed
permits,
which
is
funded
in
future
years
from
the
city's
cost.
Excuse
me,
the
city,
stabilization
Reserve.
The
intention
is
for
the
reserve
to
increase
when
fees
are
collected
in
relation
to
unprocessed
permits
and
for
this
balance
to
be
drawn
down
as
work
is
completed.
A
The
cost
recovery
model
contains
two
key
components:
cost
and
revenue
permitting
program
costs
include
all
city
services
that
support
development
and
building
related
activities.
This
includes
direct
labor
and
indirect
costs
such
as
technology
infrastructure
and
overhead
charges
permitting
program.
Revenue
comes
from
permit
fees
charged
to
fulfill
the
city's
development
and
building
related
permitting
bylaws.
A
He
set
out
to
examine
whether
the
city's
permit
fee
model
reasonably
complied
with
legislative
and
policy
requirements.
We
sought
to
ensure
the
city's
permit
fee
model
was
comprehensive,
accounting
for
current
and
anticipated
future
costs
and
revenues
of
the
permitting
program.
We
also
looked
at
whether
the
city
regularly
reviewed
and
updated,
updated
its
permit
fee
model
to
determine
fee
charges.
A
A
Lastly,
we
didn't
examine
the
effectiveness
of
the
city's
current
earned
Revenue
transition
and
the
accuracy
of
the
deferred
revenue
balance,
both
of
which
relate
to
the
city's
annual
financial
statements.
The
city
plans
to
finalize
the
amounts
by
the
end
of
the
year.
They
will
be
subject
to
external
Financial
audit
by
our
Auditors
KPMG.
A
Although
improvements
were
made
in
2022
between
2016
and
2021,
the
city
set
permit
fees
based
on
a
misaligned
revenue
and
cost
component,
resulting
in
and
under
recovery.
The
city
indicated
that,
based
on
the
current
estimate
of
work
and
process,
funding
from
other
sources
will
be
required
to
complete
outstanding
permit
work,
although
due
to
deficiencies
in
the
underlying
data,
neither
the
city
nor
we
could
calculate
the
amount
of
the
shortfall
with
any
precision
Additionally.
A
The
city
didn't
have
guidance
related
to
the
appropriate
level
of
cost
recovery
for
each
permit
category,
resulting
in
unplanned
cross-subsidization
between
permit
categories.
These
excuse
me.
These
findings
highlight
some
of
the
more
important
opportunities
for
improvement.
Overall,
we
concluded
that
the
city
didn't
meet
our
audit
objective
during
the
audit
period.
The
cost
recovery
model
wasn't
designed
and
applied
to
ensure
the
full
cost
of
services
were
recovered
and
projected
Reserve
fund
balances,
weren't
sufficient
to
stabilize
future
operations.
A
E
E
The
city
aimed
to
set
permit
fees
at
levels
that
cover
the
full
cost
of
providing
Permitting
Services
and
use
permit
Revenue
solely
for
sorry,
no
one
page
before.
Yes,
that's
correct
slowly
for
Permitting
Services.
Overall,
this
approach
generally
complied
with
Charter
and
legal
requirements
set
out
in
the
Canadian
case
law.
E
However,
the
city
did
not
have
a
review
process
in
place
to
ensure
these
fees
were
set
in
alignment
with
the
charter
management
performed
an
analysis
of
these
fees
and
their
analysis
showed
that
the
fees
collected
for
subdivision
permits
and
rezoning
applications
didn't
exceed
the
cost
of
processing.
This
application
for
the
most
of
the
audit
period.
E
This
leads
us
to
the
first
recommendations
for
the
city
to
better
ensure
its
compliance
with
the
Vancouver
Charter.
The
city
should
annually
review
and
document
its
fees
for
subdivision
permits
and
rezoning
applications
against
the
actual
cost
of
processing
those
applications
to
ensure
the
fees
charged
do
not
exceed
the
average
cost
of
processing
similar
applications.
E
When
our
office
looked
into
the
city's
policies
and
procedures
for
permitting
program
cost
recovery,
we
found
that
the
city
lacked
documented
guidance
on
the
design
and
implementations
of
Permitting
program
fees,
including
departmental
roles
and
responsibilities.
With
respect
to
meeting
the
cost
recovery
objective,
the
absence
of
documented
guidance
can
result
in
inconsistent
practices
and
knowledge
gaps
between
permitting
departments
and
their
staff,
and
can
detract
from
program
performance
and
public
transparency.
E
E
This
leads
us
to
the
second
recommendations
for
the
city,
to
establish
and
document
clear,
detailed
guidance
for
the
permitting
program
in
developing
this
guidance
management
should
seek
policy
direction
from
Council.
I
won't
read
the
full
recommendation,
but
the
documented
guidance
should
include
items
such
as
whether
the
city
intends
for
fees
to
cover
the
full
cost
of
providing
Permitting
Services
and
under
what
circumstances
fees
might
be
set
at
more
or
less
than
100
of
full
costs.
E
E
However,
the
city's
cost
recovery
model
used
different
basis
of
measurement
for
revenues
and
costs.
Revenue
projection
was
based
on
the
number
of
application
it
expected
to
receive,
which
was
compared
to
the
cost
of
operating
the
permitting
departments,
regardless
of
the
number
of
permits
that
could
be
processed
as
a
result
of
the
misalignment
of
cost
and
revenue
components,
the
city
could
not
accurately
determine
the
actual
level
of
cost
recovery
nor
accurately
determine
the
program's,
Surplus
and
deficits
in
any
given
year
for
2021.
E
Please
note
that
in
2022
the
city
started
projecting
costs
and
revenue
based
on
the
same
basis
of
measurement
which
is
number
of
applications
they
could
process
during
the
year
going
forward.
We
recommend
that
the
city
accurately
calculate
the
projected
and
actual
level
of
permit
fee
cost
recovery
using
earned
revenues
and
adjust
permit
fees
accordingly
to
ensure
they
meet
the
city's
full
cost
recovery
objective
in
alignment
with
policy
direction
from
Council.
E
E
We
noted
that
the
city
did
not
perform
a
cost
analysis
of
unprocessed
permit
applications
where
there
is
a
delay
between
collection
of
permit
fees
and
the
processing
of
the
related
permit
applications.
The
cost
to
process
permits
may
change.
Therefore,
it
is
essential
for
the
city
to
understand
the
costs
related
to
completing
unprocessed
applications
to
ensure
sufficient
funds
are
available
in
the
future
to
fund
the
completion
of
work.
E
E
The
city
set
permaf
fees
at
entire,
permitting
program
level
and
generally
apply
flat
rate
increases
across
most
permit
fees.
Cross
subsidization
occurs
when
revenue
from
one
permit
categories
is
used
to
cover
the
cost
of
another
permit
category
within
the
overall
permitting
program.
Most
start
from
permitting
departments.
We
interviewed
were
aware
of
the
possibility
of
cross-subsidizations
within
the
permitting
program.
However,
they
were
unsure
of
the
level
of
cross-subsidization
that
existed.
E
Finance
conducted
some
analysis
of
cost
recovery
at
various
permit
category
levels.
However,
we
found
that
the
city
did
not
have
guidance
related
to
appropriate
level
of
cost
recovery
for
each
permit
category
to
understand
the
potential
magnitude
of
the
Cross
subsidizations
within
the
permitting
program
and
the
potential
value
to
the
city
of
incorporating
data
on
cross-subsidizations
into
its
model.
E
Please
note
that,
due
to
limitations
in
the
underlying
data,
the
figures
used
in
this
analysis
or
estimates,
given
that
the
city
had
no
formal
guidance
on
its
desired
level,
cost
recovery
for
each
primary
category.
Sorry,
previous,
thank
you.
Given
that
the
city
had
no
formal
guidance
on
its
desired
level
of
the
cost
recovery
for
each
permit
category.
We
characterize
this
cross-subsidization
as
unintentional,
as
we've
shown.
Analysis
of
the
permit
program
level
doesn't
allow
for
Meaningful
insight
into
the
level
across
subsidization.
E
E
The
city
should
develop
guidance
on
the
appropriate
Target
level
cost
recovery
for
each
permit
category
of
the
permit
bylaw
level.
Then
the
city
should
assess
the
level
of
cost
recovery
for
each
permit
category
against
the
target.
Another
adjust
fees
as
necessary.
This
would
improve
the
city's
fee,
setting
ability
and
support
public
transparency.
E
The
last
area
the
audit
focused
on
were
annual
fee
updates
and
financial
analysis
performed
for
the
permitting
program.
We
found
that
the
city
followed
a
consistent
and
systematic
approach
to
annually
update
the
fee
schedule,
based
on
the
outputs
of
the
cost
recovery
model
and
communicated
permit
fees
changes
to
the
public.
However,
the
city
didn't
publish
details
regarding
the
permitting
program's
Reserve
balance
in
the
fee
increase
report
to
council
We
Believe
public
transparency
is
better
served
by
publishing
annually
the
contributions
draws
and
balances
of
the
permitting
program
Reserve
fund.
E
This
leads
to
our
next
recommendations
for
the
city
to
publish
additional
information
about
the
permitting
program,
including
the
reserve,
opening
balance
net
Surplus
and
deficits,
closing
balance
for
the
year
and
level
and
sources
of
subsidization.
If
there's
any
the
city
included
relevant
cost
components
in
the
cost
recovery
model,
however,
opportunities
for
improvements
were
identified.
E
The
last
audit
finding
is
related
to
financial
analysis
perform.
Although
the
city
performed
long
program
level
financial
analysis,
it
did
so
only
on
an
annual
basis.
Longer-Term
financial
analysis
would
better
enable
the
city
to
manage
the
program's
sustainability
going
forward.
We
recommend
that
the
city
develop
costs
and
revenue
projection
that
extends
Beyond
one
year
in
order
to
support
analysis
of
the
permitting
program's
long-term
self-sufficiency.
E
A
Thank
you
Stacy
and
members.
I
know
this
was
a
bit
of
a
dense
and
Technical
topic
thanks
for
sticking
with
us
on
this
one,
but
it
was
also
valuable
in
terms
of
the
dollar
impact
for
the
city.
There's
two
recommendations
before
the
committee
to
receive
the
report
and
to
endorse
the
eight
recommendations
it
contains,
but
I
think
I
should
turn
it
back
to
the
chair
and
suggest
that
this
might
be
an
opportune
time
to
invite
the
city
to
respond.
B
Thanks
Mike
and
seeing
members
of
our
staff
here,
if
Tennessee
Patrice
Impe
go
into
the
mic,
hi
Patrice.
F
Thank
you,
chair
Patrice,
simpi,
general
manager,
Finance
risk
and
Supply
Chain
management.
First
I
would
like
to
express
my
gratitude
to
Stacy
have
been
in
the
auditor
general
team
for
their
high
level
of
professionalism
and
and
their
patience
throughout.
This
is
a
very
complex
process,
as
you
heard,
and
they
really
took
the
time
to
understand
this.
F
The
city's
process
and
and
our
information
I
also
wanted
to
just
thank
the
the
finance
the
senior
leaders
in
our
finance
team,
who
were
very
receptive
and
and
really
working
very
closely
with
the
auditor
general
in
in
doing
this.
Supporting
this
audit
and
the
audit
was
executed
with
inclusiveness
transparency
and
was
well
received
by
the
staff
teams.
F
The
process
provided
us
with
valuable
external
insights
into
the
administration
of
cost
recovery
program
and
helped
us
identify
inconsistent
inconsistencies
and
opportunities
for
improvements,
and
a
number
of
those
are
quite
consistent
with
areas
that
the
team
has
been
working
on
since
2020
as
I
get
noted.
I.
Think
council
is
very
aware
that
the
permitting
process
at
the
city
is
undergoing
significant
change,
primarily
to
improve
customer
response
time,
streamlining
processes
and
admin
and
addressing
the
complexities
of
the
process
and
that
initiative
the
permanent
Improvement
project,
which
we
call
the
the
PIP.
F
That
is
the
process.
We
really
are
relying
on
to
to
give
us
a
more
complete
understanding
of
the
data
around
revenue
and
expenses
within
the
permitting
area
to
allow
us
to
do
that
cost
analysis
and
to
provide
that
data
that
it
doesn't
exist
today
for
us
to
be
able
to
accurately
calculate
some
of
these.
The
cost
recovery
numbers
just
be
a
few
comments
on
the
process.
The
city
has
historically
managed
cost
recovery
within
the
permit
program
by
balancing
the
fees
received
each
year
with
the
program
cost.
F
As
noted,
and
this
was
in
accordance
with
financial
reporting
standards
and
is
consistent
with
other
municipalities.
An
approach
was
validated
by
an
independent,
consulting
firm
at
Henson
Associates,
but
things
change
in
2020.
The
city
began
to
look
at
ways
that
we
could
improve
the
cost
covery
approach
and
particularly
noting,
as
the
Auditors
have
the
considering
the
work
in
process.
F
When
we're
assessing
the
cost
recovery,
so
we
began
that
work
in
2020.
It
became
really
much
more
important
and
more
impactful
as
permanent
applications
became
more
complex
and
as
the
work
process
has
changed
through
covid-19
increase
the
amount
of
the
unprocessed
work.
F
F
The
recommendations
contained
in
the
report
provide
valuable
input
on
the
ongoing
work
that
we're
doing
to
improve
the
cost
recovery
model
and
the
team
wants
to
acknowledge
the
value
of
the
audit.
We
support
the
eight
recommendations
in
the
report
regarding
the
changes
to
how
we
administer
the
program.
So
once
again,
thank
you
very
much
to
our
to
our
team,
to
our
business
partners
and
Theresa
and
Andrea's
group
and
to
the
auditor
general,
and
we
look
forward
to
continuing
to
improve
this
process.
B
Thank
you
Patrice
now,
I
guess
we
can
move
to
I,
see
questions
on
the
queue
so
Mike.
Unless
you
had
any
follow-up
comments,
I'm
going
to
invite
questions,
starting
with
councilor
Kirby
Young.
D
Yeah
thanks,
chair
and
I
want
to
thank
the
auditor
general
and
the
team
for
the
work
on
this
report.
It's
a
important
one
and
a
substantive
piece
of
work
I
just
want
to
sort
of
reflect
back
what
I
heard
in
simple
layman's
terms
and
show
I
have
this
correct,
which
is
that
we
have
a
premise
at
the
city
of
Vancouver
that
the
permitting
work
is
funded
through
cost
recovery.
But
we
have
a
situation
here
where
we've
determined
that
that
is
not
the
case
and
that
we
are
actually.
D
F
D
D
D
You
now,
can
you
hear
me
now?
Yes,
okay,
so
my
question
is
for
Mike
McDonald
so
and
I
just
want
to
reflect
this
enlightenment's
terms
that
the
city
of
Vancouver
has
a
premise
that
permitting
process
would
pay
for
so
but
not
be
theirs.
But
what
we've
determined
is
that
application
to
subsidize
through
taxpayer
funds,
as
opposed
to
those
that
are
seeking
the
permitting
work
and
we've
left
millions
of
dollars
on
the
table?
Is
that
correct
in
layman's
terms,
that's
to
Mike.
A
And
Kelso
Kirby
young
your
request
for
clarification
correctly,
that
in
fact
the
the
permitting
program
well
intended
to
be
full-cost
recovery
was
in
fact
not
achieving
that
objective
and
that
that
is
in
fact
what
we
found
that
for
for
2022,
for
example,
the
under
recovery
was,
was
just
shy
of
12
million
dollars,
so
so
the
that
that
would
be.
That
would
be
a
correct
conclusion
on
your
part.
F
D
I
have
a
limited
amount
of
time
for
questions,
so
yeah,
no
I
appreciate
that
and
I
know
that
staff
have
identified
that
there
was
an
issue
with
multi-year
permitting
and
carryover.
But
what
I'm
wanting
to
identify
with
the
auditor
general
directly,
which
is
my
question,
is
directed
to
them,
is
that
we
haven't
determined.
D
B
Thank
you
back
on
the
Queue
at
that
point.
Apologies
we'll
move
next
to
counselor
Joe.
G
Okay,
thanks
thanks,
chair
yeah
and
thanks
other
General
and
the
team
for
putting
this
report
together
and
thanks
for
the
for
the
stocking
team
for
the
continuous
Improvement.
So
my
question
here
is:
you
know
we
have
12
million
dollars
deficit
in
2021.
So
what
are
the
funding
sources
for
that?
12
million
dollars
it's
coming
from
our
Reserve
or
it
is
coming
from
our
operational
cost?
Yes,.
F
Through
the
stabilization
Reserve
with
the
idea
that,
through
the
permanent
Improvement
program,
that
costs
will
will
improve
and
and
we'll
be
able
to
repay
that
through
the
stabilization
Reserve,
okay,
it's
not
impacting
current
your
property
tax.
Just
for
clarity,.
G
F
It
was
specifically
for
years
2021
and
2022,
where
we
were
investing
in
increasing
Staffing
and
and
and
the
project
for
the
permanent
improvement
process,
and
that
was
being
funded
out
of
the
reserve
again
with
the
the
goal
of
that
being
recouped
once
the
program
is
completed
and
we've
improved
the
process
and
simplified
the
processes.
Okay,.
F
G
And
the
other
question
is
I
know
the
for
of
the
general.
The
the
fees
is
not
in
the
scope,
but
what
are
the
reasons
for
this
under
recovery
because
our
fees
is
too
low
or
operating
cost
is
too
high,
I'm
just
I'm,
not
I,
don't
know
if
you
have
that
answer
or
not,
because
it
is
probably
out
of
the
scope
for
the
reasons
you.
A
You
you're
correct
Council
Joe
in
that
sense,
but
fee
setting
is
a
policy
decision
on
the
part
of
council.
So
it's
not
my
place
to
do.
Okay,
that's
the
correct
fee.
G
A
G
Thanks,
my
last
question
is
the
number
for
2021
I
saw
that
chart,
so
it
is
based
on
the
date
of
application
or
the
date
of
received
a
permit.
A
The
the
fees
were
based
on
the
date
of
applications,
so
application
fees
were
actually
received.
All
costs
are
related
to
as
permits
are
issued,
so
the
actual
cost.
So
there
were
two
different
levels
of
activity:
okay,.
G
So
what
I'm
trying
to
get
is
the
deficit
is?
Is
it
because
of
our
long
permitting
wait
time
or
it
is
because
of
the
volume?
So
that's
why
I'm
asking
this
question
but
I
guess
it's
hard
to
make
that
decision
basis.
Yeah.
A
It's
it's
neither
really
it's
it's
in
any
particular
year
the
volume
of
permits
will
be
higher
or
lower,
and
and
as
corresponding
fees
will
be
higher
or
lower.
Based
on
on
the
volume
of
permit
applications
coming
in.
G
F
You
do
a
re,
do
our
fee
review
annually
and
we'll
be
working
on
that
over
the
next
few
months
and
that
will
come
to
council
I
believe
in
the
fall
in
September
in
September,
so
we'll
be
doing
that
work
shortly.
Perfect.
B
Great,
thank
you.
Counselor
show
counselor
Montague.
H
Oh
thanks,
chair
thanks
for
the
report
and
it's
nice
to
see
that
Finance
risk
and
Supply
are
are
all
on
board
and
and
that
they
agree
with
all
the
recommendations
that
are
set
out
here.
I
guess
my
questions
are:
how
confident
are
we
that
we
can
start
aligning
the
the
actual
fees
versus
Revenue,
as
we
can
decrease
that
deficit
or
have
no
deficit?
And
how
long
do
we
think
that
will
take.
F
Me
yes,
since
in
the
for
the
last
couple
of
years,
we
have
realigned
our
calculation
on
the
revenue
and
expenses
recognizing
this
work
in
process
and
the
unprocessed
inventories
and
the
value
of
that.
So
that's
what
we
have
reported
in
our
fee
review
last
year
and
we
will
report
that
way
again
this
year
to
determine,
if
there's
a
a
gap
or
not.
F
It's
then
a
council's
decision,
whether
to
increase
fees
in
order
to
cover
that
deficit
or
to
fund
it
through
the
stabilization
Reserve
with
you
know
a
future
year
payback
once
the
cost
of
processing
is
reduced
through
the
prom
through
the
permit
project.
So
it
is
a
council
decision
to
increase
fees
so
that
it
is
100
cost
recovery
or
to
maintain
fees
at
a
at
a
lower
increase,
and
then
you
know
with
knowing
that
we'll
get
the
payback
from
those
investments
in
technology,
energy
and
Staffing
Etc.
So.
H
When
those
fee
increases
come
to
council
and
I've,
seen
those
few
increase,
they're
very
complicated
for
us
for
sure,
do
you
know
in
the
reports
whether
or
not
it's
full
cost
recovery
or
or
how
much
cost
recovery
in
those
fee
increase?
Yeah.
F
It
says
in
the
report
how
much
the
fee
would
have
to
go
up
to
be
full
cost
recovery,
I'm,
pretty
sure
we
calculated
and
yes,
so
we
would
say
to
be
full
cost.
Recovery
would
be
X,
we're
recommending
a
fee
increase
of
only
five
percent.
Just
given
the
complexity
and
the
impact
on
them
on
on
permanent
holders.
H
Knowing
that
we're
improving
at
23
20
24
25,
are
we
looking?
Are
we
going
to
be
at
full
cost
recovery,
or
are
we
still
going
to
be
looking
at
a
deficit
potentially.
B
I
We're
actually
very
excited
about
this
report.
We
know
we've
been
under
recovering.
We
do
have
a
lot
of
work
to
do.
We
know,
particularly
on
the
zoning
fees,
that
we
might
need
some
new
fees
to
differentiate
different
streams
of
work
and,
to
be
very
honest
and
very
candid,
my
team
have
not
been
good
about
documenting
their
time,
so
I
don't
have
good
data
on
what
my
costs
are.
I
We
kind
of
do
a
roll
up
a
general
but
we're
gonna
I've,
given
them
strict
instructions
and
we're
gonna,
look
at
make
sure
that
we're
cover
that
we
have
identified
all
our
costs
and
we're
tracking
them
and
to
your
point,
counselor.
We
want
to
make
sure
we're
not
over
delivering
on
service
right.
Are
we
providing
too
much
service
and
not
enough
fees?
So
we
want
to
do
that
alignment,
and
we,
of
course,
will
bring
all
that
data
and
work
with
the
finance
department
to
do
that.
I
So
we
have
a
really
good,
solid
understanding
of
what
our
costs
are
and
what
our
service
levels
are
and
what
our
revenues
will
be.
H
Okay,
so
because
yeah
looking
at
2021
a
deficit
of
12
men,
if
we,
you
know,
expand
that
over
a
four
or
five
year
period,
we're
looking
at
50
or
60
million
dollars,
we're
leaving
on
the
table,
which
is
we
can
do
a
lot
with
50
or
60
million
dollars
for
sure
in
the
city.
Absolutely
my
last
question
is
engineering
permits.
I
know
it
wasn't
part
of
the
scope
of
the
audit,
but
do
we
have
a
sense,
I
guess
Patrice?
F
F
You
and
the
biggest
challenge
is
when
the
multi-year
like
permits
that
are
extending
over
many
years,
and
how
to
cost
that
if,
when
it's
immediate
delivery,
then
it's
much
easier
to
do
the
calculation
of
Revenue
and
expenses
sort
of
within
a
year.
It's
this
multi-year
piece
that
makes
it
more
complex.
Thank.
B
Counselor
Montague
councilor
dominetto.
J
Thank
you,
chair
and,
and
thank
you
for
the
report
this
morning,
I
think
it's
fantastic
to
see
this
report
back
and
a
couple
of
my
questions
have
been
asked.
I'll
just
focus
on
a
couple
more
that
I
had
just
referring
to
I
believe
it's
Paige,
oh
I,
can't
see
page
number
on
here,
but
maybe
page
13,
the
summary
permitting
program
fee
updates,
2018
to
2022
I'm,
just
curious.
J
If,
if
the
auditor
general
could
expand
a
little
bit
on
that,
because
what
I
see
is
quite
a
bit
of
variation
year
over
year
in
terms
of
the
percentage
increases
and
then
I
was
obviously
on
Council
when
there
was
that
significant,
significant
increase
in
2019
to
add
staff,
but
I'm
curious
about
your
perspective
on,
should
there
be
more
consistency
or
predictability
in
those
fee
increases?
Obviously
the
goal
being
you
know,
cost
recovery.
J
But
could
you
just
comment
on
that?
More
generally,.
A
I'll
be
perhaps
somewhat
circumspect
and
answering
that
question
councilor
dominado
in
the
sense
that
fee
setting
is
a
policy
decision
that
that
is
really
council's
prerogative.
What
we
have
recommended
in
the
report,
though,
is
that
the
analysis
that
underlies
staff's
recommendation
to
council
for
fee
setting
should
be
done
on
a
multi-year
basis,
rather
than
on
a
year
by
year
basis
to
take
into
account
expected
fluctuations
in
in
processing
or
fee
volume,
also
to
to
yeah
that
that
would
be
the
oh.
A
It's
so
excuse
me,
and
also
to
to
take
into
account
how
quickly
you
want
to
make
up
the
Gap
in
in
the
the
deficit
from
from
year
to
year.
Is
that
it's
all
in
once,
or
is
that
something
that
might
be
done
over
a
number
of
years
and
again,
that's
that
I
think
is
a
process
that
needs
to
be
discussed
openly
and
and
a
conscious
decision.
But
in
terms
of
what
the
right
answer
is.
That's
it's
really
not
for
me
to
say:
okay,.
J
Thank
you
I
appreciate
that
I.
The
other
question
I
had
was
this
with
respect
to
in
terms
of
the
modeling
and
calculating
those
fees,
is
what
consideration
is
there
for
inflation,
given
that
we've
entered
into
a
different
inflationary
environment
has
had
an
impact,
while
salaries
may
be
stable,
but
other
services?
Even
you,
know,
technology
that
acquisition.
You
know,
other
things
outside
of
the
labor
sort
of
fixed
cost
of
our
labor
City
costs.
A
What
we
found
is
that
the
essentially
all
the
relevant
costs,
we
believe
have
been
correctly
identified,
both
reject
labor
and
but
also
overhead
costs
that
or
other
costs
formed
by
the
city
that
directly
impact
this.
A
That
would
include
an
inflation
from
from
year
to
year,
although
I
stand
to
be
corrected,
whether
there
was
actually
an
inflation
adjustment
that
that
was
part
of
that
I
don't
know
Stacy
does
that
bring
any
bells?
Yes,.
K
Thank
you,
announcer
Frye,
first
off
I,
just
want
to
say
I'm
really
pleased
with
the
with
the
report.
I
think
Mike
and
Stacy
have
done
a
really
good
job
in
terms
of
of
dealing
with
a
very
complex
process
and
and
issues
and
I
I
agree
with
their
findings
and
their
recommendations.
K
I
I,
wonder
and
I
also
think
that
this
will
improve
the
the
transparency
in
the
in
the
process,
which
will
help
counsel
in
terms
of
dealing
with
with
the
fee,
setting
and
and
making
decisions
around
the
costing
and
and
revenue
related
to
the
process
and
and
a
third
observation
would
be
that
I'm
very
pleased
with
seeing
Finance
Patrice
MP's
response
to
the
the
recommendations.
I
think
it's
very
positive
and
identifying
the
the
next
steps
on
on
the
with
this
process.
K
I
Mike
I
just
have
a
couple
questions
just
to
clarify.
In
my
mind,
I
sort
of
identified
three.
K
And
I
wondered
if
you
could
sort
of
I
I
know
you
probably
aren't
in
a
position
of
quantifying
the
the
impact
of
of
them,
but
you
know
perhaps
in
terms
of
the
magnitude
you
know.
The
first
issue
is
around
which
I
I
heard
raised
by
the
the
counselors
in
terms
of
the
cost
recovery
process.
Is
there
you
know
the
question
is.
B
K
Okay,
is
that
better.
K
The
first
question
is
around
the
sufficiency
of
of
cost
recovery,
and
is
there
in
terms
of
my
question.
Mike
is
in
terms
of
the
magnitude
of
the
issue
of
the
three,
the
three
questions.
K
First,
one
dealing
with
the
is
there
you
gave
a
number
in
terms
of
the
deficiency
of
of
Revenue
versus
cost
for
this
year,
and
I
was
just
wondering
if
you
can
also
quantify
in
terms
of
there's
a
I
believe
this
I
believe
a
misalignment
between
deferred
revenue
and
and
the
amount
of
money
that's
been
recognized
as
Revenue.
So
that's
sort
of
the
second
issue
and
I
guess.
The
third
issue
would
be
the
cross
subsidization
between
the
various
rates
or
or
permit
classes.
A
Well,
thank
you.
Thank
you,
Archie
with
respect
to
the
the
year
over
year
deficiency
that
we
did
identify
in
the
report,
a
figure
of
11.9
million
for
2021.
The
the
expectation
is
that,
with
better
data
going
forward,
2023
onwards,
that
that
that
systemic
deficiency
should
be
eliminated,
I
can't
predict
with
certainty
that
will
be
the
outcome,
but
that
certainly
is
the
intention
of
the
recommendations
that
we've
made
and
I
believe
it
is
staff's
intention
to
to
do
that
as
well.
A
Regarding
the
the
deferred
revenue
balance,
so,
essentially
is
the
deficiency
with
respect
to
the
funding
of
unprocessed
permits.
That
was
the
figure
that
we
unfortunately
could
not
identify
with,
with
a
an
audit
degree
of
certainty
first
to
include
it
in
the
report.
It's
a
figure
that
would
have
to
stand
up
to
external
scrutiny
and
the
data
just
wasn't
there
on
either
the
cost
or
the
revenue
side
for
us
to
be
able
to
to
speak
to
it.
With
with
certainty,
all
I
can
say
is
that
it's
a
it's
significant.
A
The
staff
is
aware
of
the
issue,
and
it
is
something
that
will
be
worked
on
with
respect
to
the
reporting
in
the
upcoming
financial
statements
again
with
better
data.
That
would
be
something
that'd
be
easier
to
do,
and
staff
may
may
have
further
comment
on
on
that
in
terms
of
cross-subsidization.
A
The
issue
is,
is
I,
think
really
a
policy
one,
and
it's
it's
in
terms
of
improving
transparency.
This
is
information
that
should
be
brought
before
Council
for
a
specific
and
and
deliberate
decision,
and
so
that-
and
it
is
understood
that
different
categories
of
permit
have
different
levels
of
cost
recovery,
that
that
is
not
something
that
just
goes
on
behind
the
scenes,
but
is
part
of
an
open
and
transparent
process.
F
So
if
I
could
add
just
on
the
revenue
recognition
just
to
confirm
at
this
point
in
time,
Revenue
recognition
is
on
a
cash
basis
for
for
permitting
still
in
our
financial
statements.
So
the
work
we're
doing
is
through
putting
it
through.
The
reserve
is
sort
of
emulating
or
simulating
what
sort
of
revenue
revenue
recognition
would
be
if
it
was
based
on
an
earned
revenue
and
we've
been
using
earned
Revenue
in
our
modeling
effective
next
year.
F
The
accounting
rules
will
change
where
we
will
be
recognizing
revenue
on
the
financial
statement
based
on
an
estimate
of
earned
Revenue,
so
that
will
help
to
simplify
some
of
the
complexity
of
this
process.
So
that
is
a
good
thing
and
we're
you
know
all
set
up
to
to
be
doing
that
and
the
second
point
on
the
cross
subsidization
just
to
clarify,
as
Mike
said,
that
understanding
at
a
certain
level,
not
necessarily
at
the
detail,
bylaw
level
is
clear
and
we
do
have
that
data.
F
We
are
and
I
think
the
point
being.
We
need
to
make
that
clearer
for
Council
in
the
public
and
also
get
councils
sort
of
confirmation
of
that
we
are
in
the
Vancouver
Charter
allowed
to
have
cross-subsidization,
because
we
can
do.
We
can
do
our
pricing
at
a
program
level,
so
that's
accepted,
but
it's
I
think
the
point
being.
We
should
have
it
clear
for
Council
and
have
direction
from
Council
on.
You
know
that
that
is
this,
that
that's
acceptable
in
the
in
the
direction
there
thanks.
B
Thanks
Patrice
Mike
Archie
I
gave
you
a
little
extra
time
there.
I
now
see.
Councilor
Kirby
young
is
back
on
with
a
much
crisper.
Looking
video,
so
I
think
that
we'll
have
a
fine
signal
for
councilor
Kirby
Young.
D
Yeah
thanks
chair
and
I
apologize
for
the
audio,
but
I
appreciate
the
the
work
that's
done
on
the
report
and
by
the
AG
team
and
my
staff.
My
couple
questions
and
some
of
my
more
answered
in
terms
of
the
magnitude
not
just
of
the
one
2021
year
that
was
identified
by
the
overall
potential
loss,
but
a
couple
follow-up
questions,
I.
D
Think
one
of
the
recommendations
that
I'm
hearing
this
question
is
directed
to
Mike
is
really
about
daylighting
kind
of
end
to
end
the
entire
process,
and
not
just
the
fees
but
also
publishing
the
required
Reserve
or
subsidization
amount,
and
what
the
Gap
in
the
shortfall
is.
Is
that
correct.
D
Because
and
presumably
by
making
that
more
explicit
and
clearer,
then
that
enables
addressing
the
issue
and
that's
the
intent
behind
that
recommendation.
D
Okay
and
I
heard
comment
and
I
apologized.
My
audio
was
cutting
out,
but
I
just
wanted
to
clarify.
I
heard
a
comment
along
the
lines
of
trying
to
recover
sort
of
the
shortfall
or
the
Gap,
but
from
a
I'm,
not
sure
how
that
would
work
from
a
fairness,
perspective
and
I
just
want
to
clarify
what
I
heard
there
was
there
a
suggestion
that
we
would
go
back
to
the
development
Community
to
recover
that,
or
is
this
just
simply
a
sunk
loss
that
we
have
to
address
so
that
we
don't?
A
I
I,
don't
know
the
answer,
so
I
I
would
actually
suggest.
Perhaps
that's
better
directed
towards
staff.
B
Decrease
in
peace
here
and
I'm
going
to
allow
you
a
little
extra
time,
Council
Kirby
young,
so.
F
We
would
not
go
retroactively
to
to
change
rates.
What
it
would
mean
is
as
the
as
our
process
improvements
come
into
effect
and
the
process
is
simplified.
F
The
team
should
be
able
to
process
more
permits
with
the
stuff
that
they
have,
and
so
then,
that
Revenue
we
wouldn't
need
to
be
holding
as
much
revenue
in
the
stabilization
Reserve
as
those
permits
gets
processed.
So
if
that
makes
sense,.
D
Okay,
do
do
we
need
any
further
changes
to
policy
as
part
of
the
outcomes
here
with
respects
to
the
permit
for
cost
model?
Is
that
sort
of
an
operating
philosophy,
or
is
that
a
specific
policy
and
do
we
need
any
additional
changes
in
policy
and
maybe
I
can
direct
that
one
to
Mike?
Is
that
a
potential
other
point
of
due
diligence?
A
No
thank
you
for
that.
Council
Kirby
young
I
I,
haven't
recommended
that
at
this
point
it
may
be
something
the
council
wishes
to
consider
in
terms
of
say,
you
know
specifically
understanding
and
directing
what
level
of
cost
recovery
is
appropriate
for
various
categories
of
fee.
For
instance,
that
may
be
something
that
you
wish
to
put
in
policy,
or
you
may
wish
to
leave
yourself
the
flexibility
to
vary
that
over
time.
D
Okay
and
then
one
last
quick
question
is
the
terrible
indulge
me
I.
Think
it's
a
quick
one.
What
is
our
next
opportunity?
This
is
directed
to
Patrice,
to
adjust
fees,
to
ensure
that
they
are
cost
of
recovering
I
know
that
we
set
them
annually
and
we're
in
the
year
now
for
the
year.
D
F
Coming
to
Council
in
September,
with
the
fee
review
for
the
following
year
and
those
fees
are
usually
implemented
in
the
fall
so
that
there's
enough
time
for
implementation
to
begin
in
January.
B
Thank
you,
councilor
Kirby
young
I'm,
just
put
myself
on
really
fantastic
questions.
All
around
yeah
thanks,
Council,
Caribbean,
okay,
fantastic
questions.
All
around
I
just
had
one
follow-up
question
and
I
I
know
this
report.
Tangentially
mentions
covid-19
and
kind
of
some
system
changes
around
2020
2021
have
we
seen
is,
and
you
know
if
this
is
even
beyond
the
scope
of
this
work,
have
we
seen
changes
to
the
permitting
process
and
fee
recovery
with
regard
to
sort
of
remote
remote
work
and
how
that's
impacting
our
processes?
A
I
can't
say
that
that
was
part
of
the
scope
of
of
our
work
we
weren't
looking
at
say,
processing
times
or
anything
along
those
lines.
Perhaps
the
senior
management
team
may
wish
to
speak
to
that,
but
I.
It's
not
part
of
my
scope.
Sure.
F
Maybe
I
can
comment
on
the
covid-19
comments
that
was
from
staff
during
that,
obviously,
through
the
through
the
pandemic,
as
we
moved
from
home
and
and
those
things
changed
and-
and
you
know,
our
customers
work
changed
as
well.
F
That's
where
we
did
see
some
of
the
elongation
in
the
time
period
that
that
permits
took
to
process
whether
it
was
with
us
or
with
the
customer,
so
the
that
backlog
that
unprocessed
permit
increased-
and
that
is
the
piece
that
we
are
holding
our
reserve
for
as
well
right,
so
not
as
many
permits
made
their
way
through
the
process.
F
You
know
for
a
number
of
reasons.
Part
of
it
is
just
the
disruption
of
covid-19
on
our
staff
and
on
on
our
customers
as
well.
So
that
was
the
reflection,
is
those
Department
times
got
longer,
and
so
there
was
more
unprocessed
but
again
as
productivity
improves.
Those
should
be
processing
and
making
their
way
through
the
system.
So
that's
sort
of
the
question
on
how
long
will
this
take
is
as
those
move
along
those
get
processed
that
that
unprocessed
inventory
makes
its
way
through
the
system.
B
Fully
appreciate
that
staff
and
our
teams
did
a
lot
of
really
Nimble
footwork
to
try
and
pivot
and
respond
to
covid-19
and
those
changes.
So
thank
you
all
right,
we'll
see
no
further
questions.
B
Moved
by
counselor,
Zhou
and
seconded
by
counselor,
Kirby
young
is
there
any
discussion.
B
I'm
just
quickly
scanning
I,
don't
see
any
room
for
discussion,
so
clerk
I
think
we
can
just
move
to
a
vote.
Please.
B
And
that
passes
unanimously.
B
Thank
you
everybody.
This
concludes
R1
and
only
item
on
the
agenda.
So
maybe
we
have
a
motion
to
adjourn
moved
by
Montague
seconded
by
Domino,
all
those
in
favor,
say,
yay,
post,
say,
nay,
motion
carries
unanimously.
This
meeting
is
adjourned.
Our
next
scheduled
auditor
general
committee
placeholder
meeting
is
on
July
6
2023
at
9
30
a.m,
and
we
will
reconvene
in
camera
in
about
five
minutes.