conservative and take into account that demand for the Program is heavily reliant upon significant weather events, which are unpredictable. The funding for this Program will be re-assessed on an annual basis. Surplus funds, should they become available, can be redirected to other Flooding Abatement programs, such as Small Sewer Repairs or the Closed Circuit Television initiative, which have been underfunded in recent years due to the redirecting of funds to the Basement Flooding Subsidy Program.
Contributions to the Pollution Control Equipment Replacement Reserve Fund
Annually, contributions are made from the Sewer Surcharge Operating Fund to the Pollution Control Reserve. The Reserve is used to fund capital expenditures related to equipment refurbishment & replacement at the Pollution Control facilities. The Reserve, and the contributions to it, have been in place for some time and are monitored and adjusted periodically, as capital needs change.
Presently, the annual contributions to the Pollution Control Reserve total $4,868,745. Given current contribution levels and capital spending projections, the Reserve is projected to be in a $4.5M deficit position by 2023. Although included as an option in the 2020 operating budget documents, a proposed increase to the Pollution Control Reserve is not being recommended at this time. As stated earlier, it is Administration's view that the appropriate funding level of the Pollution Control Reserve be addressed as part of the work coming out of the Sewer Master Plan and the Storm Water Financing Study, which focus on a more comprehensive approach to both the sewer and stormwater long-term capital planning and financing.
In total Administration is recommending an overall increase to the 2020 Sewer Surcharge budget of $6,318,502, as detailed in the table below:
| Sewer Surcharge-Funded Expenditures | |||
|---|---|---|---|
| 2019 Approved Budget* | 2020 Recommended Budget | Change ($) | |
| Operating | $39,311,473 | $39,629,975 | $318,502 |
| Capital | |||
| - Base | 21,600,000 | 21,600,000 | - |
| - Inflation adjustment to protect purchasing power of base funding | 1,000,000 | 2,000,000 | 1,000,000 |
| - Sewer Master Plan funding requirements to address basement flooding | 6,000,000 | 11,000,000 | 5,000,000 |