Minutes - February 11, 2021 - Finance and Facilities Committee Meeting (Budget)

Members Present:

Mr. Matt Reid (Chair)
Ms. Aina DeViet
Mr. Aaron O’Donnell
Ms. Maureen Cassidy

Regrets:

Ms. Tino Kasi

Others Present:

Dr. Christopher Mackie, Secretary-Treasurer/Medical Officer of Health
Dr. Alexander Summers, Associate Medical Officer of Health
Ms. Stephanie Egelton, Executive Assistant to the Board of Health and Communications Coordinator (Recorder)
Ms. Arielle Kayabaga, Board Member
Ms. Kelly Elliott, Board Member
Ms. Emily Williams, Director, Healthy Organization
Mr. Mirek Pawelec, Manager, Finance
Mr. Joe Belancic, Manager, Procurement and Operations
Dr. Michael Clarke, Interim CEO
Ms. Heather Lokko, Director, Healthy Start and Chief Nursing Officer
Ms. Maureen MacCormick, Director, Healthy Living
Ms. Tammy Beaudry, Accounting and Budget Analyst
Mr. Alex Tyml, Online Communications Coordinator
Ms. Jen Bieman, London Free Press
Mr. Daryl Newcombe, CTV London

Chair Matt Reid called the meeting to order at 9:01 a.m.

Disclosures of Conflict of Interest

Chair Reid inquired if there were any disclosures of conflicts of interest. None were declared.

Approval of Agenda

It was moved by Ms. Aina DeViet, seconded by Ms. Maureen Cassidy, that the AGENDA for the February 4, 2021 Finance & Facilities Committee meeting be approved.
Carried

Approval of Minutes 

It was moved by Ms. Tino Kasi, seconded by Ms. Cassidy, that the MINUTES of the February 4, 2021 Finance & Facilities Committee meeting be approved.
Carried

New Business

2021 Proposed Budget (Report No. 04-21FFC)

Dr. Chris Mackie, Medical Officer of Health, Dr. Michael Clarke, Interim CEO, and Ms. Emily Williams, Director, Healthy Organization presented the 2021 Proposed Budget. Mr. Mirek Pawelec, Manager, Finance was also in attendance to answer questions.

Dr. Mackie noted that the proposed budget is a direct reflection of the conversations around program budgeting and marginal analysis (PMBA) and the budget amounts that were approved at the November 5, 2020 Finance and Facilities meeting and the November 26, 2020 Board of Health meeting.

Dr. Clarke noted that this budget report is not what has been done in previous years due to the extraordinary times in presenting the annual service plan (ASP). It was further noted that the province has not sent the template for the ASP at this time and will be sending a truncated version. This report presented shows the financial component of the ASP.

Ms. Williams shared a brief presentation on the cost sharing and base funding portion of the budget. It was noted that in 2019, the funding ratio model for public health was changed from 75:25 (75% provincial funding, 25% municipal funding) to 70:30 (70% provincial funding, 30% municipal funding) but was put on hold in 2020 with mitigation funding. The 2020 Budget represented the 70:30 ratio, and the province’s one time mitigation reversed the ratio to 75:25, causing city and county funding increases being reversed per the health unit’s direction. This results in the values in the 2020 Budget not reflecting actuals, and impacts the budget line for 2021.

Mr. Pawelec noted that to prepare the budget, funding information was provided by the Ministry of Health (flat funded is assumed for 2021), which included COVID-19 funding. The 2021 Budget includes adjustments for PBMA investments and disinvestments, inflationary to salaries and benefits, and incremental increases for being now located at Citi Plaza.

Discussion from the committee on this item included:
• The overall budget is going up $7.35 million but noting that $7.3 million is related to COVID-19 expenses
• The COVID-19 budgeted amount is for current work (salary, contact tracing etc) but does not include vaccine rollout
• Funding for COVID-19 work is coming from the province
• The City of London is decreasing their funding to the health unit, as they are expecting the mitigation funding to come and have received their own funding from the provincial government
• Leasing costs were going to rise, regardless of what location the health unit was at, and long-term best interest for the health unit was to be at Citi Plaza
• Health equity is taken into consideration (especially in disinvestments) to have the least negative health impacts (noting that there would be impacts to work in pre-conception health to support budget requirements)
• A disinvestment was funding for consulting for diversity/inclusion assessment, and will still be able to complete work with available funds (a previous one-time request)
• It has been over 14 years that the health unit has requested increases from municipal funders
• Social media and video based programs have been used to assist in work with the health unit
• Noting that the provincial government has given verbal commitment to COVID-19 funding for 2021

It was moved by Ms. Cassidy, seconded by Ms. DeViet, that the Finance & Facilities Committee make a recommendation to the Board of Health to:
1) Approve the 2021 Proposed Budget in the gross amount of $42,657,163 as appended to Report No. 04-21FFC re: “2021 Proposed Budget”;
2) Forward Report No. 04-21FFC to the City of London and the County of Middlesex for information; and
3) Direct staff to submit the 2021 Proposed Budget in the various formats required by the different
funding agencies.

Carried

2021 Financial Situation (Report No. 05-21FFC)

Ms. Williams provided a summary to the 2021 Financial Situation. It was noted to support the COVID-19 response of the second wave, staffing needed to be increased and payroll was increased double. This extended cash flow beyond its positive margin, and the health needed to use (twice) their line of credit to make payroll. The province has provided COVID-19 funding, which put the health unit back into a positive operating margin but does not include vaccine costs (but province will be covering vaccine cost. There is still the opportunity in Q4 to submit COVID-19 related costs for reimbursement, and other health units are experiencing the same financial overextension. The province is looking at a changed 2021 reimbursement process, and the health unit is waiting for information.

Discussion from the committee on this item included:
• Reimbursement submissions are being completed on February 12
• Interest rates from using line of credit are very low, and will look to see if these costs can be recouped
• Recognizing that provincial funding often comes after the money is needed, hence the need to sometimes borrow to meet needs of the organization

It was moved by Ms. Cassidy, seconded by Mr. O’Donnell, that the Finance & Facilities Committee make a recommendation to the Board of Health to:
1) Receive Report 05-21FFC, the 2021 Financial Situation Report; and
2) Direct staff to enter into negotiations to extend the Health Unit’s rotating credit facility.
Carried

Other Business

The next meeting is March 4, 2021.

Confidential

At 9:35 a.m., it was moved by Ms. Cassidy, seconded by Ms. DeViet, that the Finance and Facilities Committee will move in camera to consider matters regarding a proposed or pending acquisition or disposition of land by the municipality or local board, and a trade secret or scientific, technical, commercial, financial or labour relations information, supplied in confidence to the municipality or local board, which, if disclosed, could reasonably be expected to prejudice significantly the competitive position or interfere significantly with the contractual or other negotiations of a person, group of persons, or organization.

Carried

At 10:03 a.m., it was moved by Ms. Cassidy, seconded by Mr. O’Donnell, that the Finance and Facilities Committee rise and return to public session.

Carried

Adjournment 

At 10:04 a.m., it was moved by Ms. Cassidy, seconded by Ms. DeViet, that the meeting be adjourned.

Carried

Matthew Reid
Chair

Christopher Mackie
Secretary-Treasurer