Building Inspector Bob Foster has asked council to provide an up-to-date evaluation of costs for his department – and all others.
Foster presented a report to the Centre Wellington committee of the whole on July 5 that shows his department has been running at a deficit for some time now.
For 2009, the township received total building permit and septic fees of $551,899. The problem is total costs to deliver services for that year were $670,212 – leaving a deficit of $118,301.
Foster said there is nothing in the reserve funds, either.
Further, he reported, there has been deficits for the past four years:
– 2006, $203,093;
– 2007, $95,778;
– 2008, $264,693; and
– 2009, $118,301.
That leaves a total deficit of $681,865 over that period.
Foster told council that next year he hopes to be close to breaking even.
His report noted that in 2009 the total direct costs for his department were $452,212, but the indirect costs were $217,988.
He said it is the indirect costs that bother him, and if they are adjusted to reflect the true cost to his department, it will be closer to breaking even.
He explained it has been six years since the indirect costs were calculated, and since then, the number of computers owned by the township has increased.He said considering the number of staff in his department versus the total staff now employed by the township would also lower his department’s indirect cost calculations.
Councillor Walt Visser said building departments usually break even or show a small profit, and if that is not the case here, “Maybe we should reduce staff.”
Foster said his department is currently very busy.
Councillor Bob Foster asked him what kind of reduction in costs he expects to see if the indirect department costs are brought up to date.
Building Inspector Foster replied he would not like to make “a wild guess.”
Councillor Foster asked, “You’re saying overhead is too high?”
Building Inspector Foster said, “Yes” – plus 2009 was a recession, and the building industry now appears to be coming out of its slump. He said business is up 43% to date over last year at the same time.
“I feel we will be closer to even – or where we should be” Building Inspector Foster said of 2010.
Councillor Fred Morris said that for the past four years, the direct total costs have not been correctly defined.
Building Inspector Foster said the last analysis of indirect costs was in 2004 or 2005. He said at that time, his department had ten computers out of the township’s 100, and was assigned ten per cent of the cost. He said the calculations are still set at ten per cent.
“The theory behind it was right, but your numbers have moved on,” he said. “I think you will find our numbers lower.”
Morris asked if the indirect costs should be assessed every two years. Building Inspector Foster said, “Probably.”
Morris said the township “has let it go too long.”
Building Inspector Foster said he would like to see the rates for indirect costs calculated every year. Council then accepted his report.
