City of Kwinana Minutes – SMRC RRRC WCF Odour Issue – 14 July 2010
16. REPORTS – PUBLIC HEALTH:
16.1 Southern Metropolitan Regional Council 2010/2011 Budget
The Southern Metropolitan Regional Council (SMRC) has outlined its budget for 2010/2011 and seeks comment from the Town of Kwinana as a member of the Regional Council.
The SMRC shows the increases for the Town of Kwinana, under membership contribution, up $2,708 or 6.6% to $43,443 and for the Regional Greenhouse project known as Climate Wise which is up $7,299 or 55% to $20,503. This is an overall
increase for both accounts of $10,007.
Project participants in the Regional Resource Recovery Centre (RRRC) have suffered significant increased costs of processing waste via gate fees as a result of the withdrawal of the City of Canning. The Town of Kwinana has in this case been fortunate that it is not a project participant in the RRRC.
Council’s cost increases are due to redistribution of population across remaining member Councils of the SMRC, which increases the percentage of the required membership contribution of the Town of Kwinana
OFFICER RECOMMENDATION:
That Council advises the Southern Metropolitan Regional Council (SMRC) that the proposed 2010/2011 budget is acceptable taking into consideration the difficult circumstances created by the withdrawal of the City of Canning from the SMRC effective from 30 June 2010.
DISCUSSION:
Council received written advice from the Southern Metropolitan Regional Council advising that its budget for 2010/2011 is scheduled for adoption at a special meeting to be held on 22July 2010.
Any comments from member Councils will be submitted to the Regional Council prior to the adoption of its 2010/2011 budget of the SMRC.
The items of particular interest to the Town of Kwinana are as follows;
These increases in cost are primarily due to the City of Canning withdrawing from the SMRC effective from the 30 June 2010. The City of Canning was a significant partner in the Southern Metropolitan Regional Council (SMRC) and their withdrawal has resulted in the other project participants of the Regional Resource Recovery Centre (RRRC) having to pay increased costs.
Without the Town of Kwinana and or the City of Rockingham agreeing to dispose of their community’s waste for processing at the RRRC, the SMRC has been left with less operational funds and is seeking other commercial operators to dispose of waste to make up the processing volumes and financial loss due to the City of Canning withdrawing.
However, the RRRC project does not impact directly on Kwinana, at this time, due to the recyclable resource being processed at Perth Engineering in Hamilton Hill via the contract for processing resources with the City of Cockburn. This will remain in place for another 12–18 months after which recyclables will be processed back at the RRRC Canning Vale. The Town of Kwinana previously paid the RRRC just the gate fee plus 10% to have recyclable resources processed for recovery and reuse.
The SMRC membership contribution for governance, research and development, and education and communication has increased $2,708 or 6.6% in 2010/10 and has been included in the Town’s budget for 2010/2011 at a cost of $43,443 as
outlined. This increase overall is $10,007 which is less than $0.94 per rateable property.
The Regional Community Greenhouse Gas Project known as Climate Wise has suffered significantly (27.43%) as a result of the City of Canning’s withdrawal. The Town of Kwinana increase is a much higher cost increase of $7,299 or 55% due to
the need for additional funding for ongoing project cash flow requirements. Annual contribution fees as per the five year business plan have increased by 14%. This Climate Wise program has been allocated a budget of $20,503 to cover the
proposed Climate Wise budget.
The effect of the City of Canning’s withdrawal will also result in the distribution of assets with the estimated member cost to the Town of Kwinana for the Head Office in Booragoon likely to be in the vicinity of approximately $2,468.
LEGAL/POLICY IMPLICATIONS:
The Town of Kwinana is a member of the Southern Metropolitan Regional Council and entitled to vote and participate in all matters of the Southern Metropolitan Regional Council.
The Town of Kwinana is not a project member of the Regional Resource Recovery Centre (RRRC) and therefore is not responsible for the loans and costs associated with the replacement of the Materials Recovery Facility.
The Town of Kwinana will be legally responsible for any portion of the net contribution liability to pay out to the City of Canning for the SMRC projects including the SMRC office in Booragoon, existing undertakings of the SMRC and the
Greenhouse Gas project. The net balance owed by the Town of Kwinana to the City of Canning is currently estimated to be in the vicinity of $2,468.
The financial estimate for the SMRC operations in 2010 /2011 of $140,438 include significant contingencies for matters associated with the City of Canning withdrawal from the SMRC. The operational cost of $63,946 covers the operational costs and the $2,468 covers the potential capital distribution liabilities for any identified capital distribution.
Funds are allocated for business program projects, contingencies and legal costs for independent legal representations to protect Council’s interest in the SMRC in resolving the withdrawal of the City of Canning.
The SMRC agreed to limit its budget increases during this difficult period and to reduce expenditure as much as possible to lessen the impact on each member Council’s budget.
ENVIRONMENTAL IMPLICATIONS:
The continued operation of the SMRC builds professional knowledge, regional assets and challenges the services model to provide for environmentally sustainable outcomes for all members and their individual communities across the region.
Continued support of the Climate Wise project increased costs via this 2010/2011 budget contribution is strongly recommended to develop a responsible community approach to Climate Wise and Climate Adaptation processes.
STRATEGIC/SOCIAL IMPLICATIONS:
Strategically Council has a direct interest to see the Southern Metropolitan Regional Council grow and prosper to provide efficient waste and recycling services to all member Council’s and their communities. Regional waste and recycling services
propose to provide security and sustainability for the long term for regional group members.
RISK IMPLICATIONS:
The risk to the Town of Kwinana is minimal with the only capital invested in the SMRC is for the SMRC office building in Booragoon. The ongoing payments for the building have been included in the Town of Kwinana budget. The asset will
continue to improve in its capital value.
COUNCIL DECISION
155
MOVED CR LEE SECONDED CR D WOOD
That Council advises the Southern Metropolitan Regional Council (SMRC) that the proposed 2010/2011 budget is acceptable taking into consideration the difficult circumstances created by the withdrawal of the City of Canning from
the SMRC effective from 30 June 2010.
CARRIED
