OBSERVATIONS AND QUESTIONS

On January 12, 2025, 2:01PM, I sent an email to the Mayor, Harold O’Krafka, and Ash Gard @ KPMG, containing a MSWord table listing a consolidation of data from Appendix A including: item #, page #, Request Form #, Project Name, and the tabled estimated capital request amount.

The email requested that the Township confirm or amend the data on the table, i.e., were my numbers accurate? To date I have received no response. Thus, either no one has read my email, they are too busy to answer me, I’m a nuisance to be ignored, or my information is accurate and requires no response. I choose the last – my numbers are accurate until proven otherwise, and served as a basis for my analysis and synthesis leading to conclusions and recommendations.

We, the CPA and I, were quite surprised to discover apparently significant discrepancies among the calculations, using the data publicly provided by the mayor, as KPMG is widely recognized as a competent accounting firm.

 One hypothesis, to explain these discrepancies, is haste. KPMG was under extreme time constraint pressures, a rush to produce several complex financial documents, using data which was, in the words of a Wilmot senior administrator, “a mess”. KPMG, we were told, has had to recreate the 2025 budget using actual spending rather than budgeted amounts. This document is not yet publicly available. It appears, from our analyses, that the resulting data documents remain a “mess”.

There appears to be a lack of accurate data and a lack of transparency regarding how the data was produced in the Capital and Operations portions of the budget.

In our calculations we have removed Water and Wastewater as it is a separate budget area, “Utilities”, and all calculations, in versus out, are designed to equal zero. That can be seen on the Excel calculations for Operations where the expenditures and revenues equal $1 deficit – probably due to a “typo” somewhere. Do professionals still make typos in final documents? Too much rush, not enough time to verify?

Observations & Concerns

There is no “back-up” for the Capital Budget requests. The tabled budget lacks rationale and clarity of process other than staff sat down and submitted lists to KPMG to calculate and report in an apparently specious form. Who made these selections? What were the criteria used in ranking / prioritizing which of the 379 items were whittled down to 44? Without these criteria and prioritized rankings tax payers are unable to make informed decisions about the viability of this tabled budget. Thus, this budget must be amended by providing that information to tax payers before any decision to approve is made.

Observations & Concerns

The Operations Budget data pages are also problematic as items don’t “balance”. Although there is a Water and Wastewater Department report on page 37 of the budget document, and the capital budget items #33 to #42 all deal with water and wastewater expenditures and specify Operating Investment expenditures, there is no explanation to indicate that water & wastewater items were probably eliminated from the Operations Budget calculations. There seems to be a lack of transparency and clarity of process.

Observation & Concern

It is practically impossible for a fair and reasonable person, trying to decide whether this Strong Mayor’s tabled budget is 1) “balanced”, 2) costs for proposed capital items are reasonable in a total cost context, 3) how they might be prioritized by a tax payer, 4) what amendments to suggest, and whether it is worthy of trust. [“When making a decision, follow the money.” “Trust, but verify before acting.”] Therefore, this 2026 budget document must be amended for clarity and fulsome transparency.

Questions > lots…

1) There are several large asks, in rounded-off dollar amounts, including:

+ #13 > $1,100,000 for WRC HVAC

+ #23 > $2,600,000 for aerial ladder @ station 3

+ #27 > $960,000 for Pavement hot mix

+ #28 > $625,000 for annual road restoration

+ #37 > $1,195,000 2 streets sanitary relining

+ #43 > $831,000 fleet replacement

Are all of the Appendix A capital budget requests presented in net dollar amounts after accounting for HST and the municipal tax rebate? Are they calculated in 2026 dollars? How to close to “accurate” are these numbers?

2) #36 and #39 have exact dollar amounts. Has the Township received the required number of quotes priced in 2026 dollars for these asks?

3) The strong mayor has indicated that she had turned over most aspects of the budget preparation, including capital project asks, to staff and KPMG to propose which projects and amounts would be tabled, as Appendix A now shows.

a. The 10 Year Capital Plan posted on the website contains 379 items. What was the decision-making process to move from 379 items to 44? Who made these final choices?

b. What were the criteria used to prioritize capital requests from most critical to “nice-to-have”, for example?

c. What role did council as a body have in determining the prioritization of projects from 1 to 44?

d. Why is #18, an update of the Township’s Development Charges included in Capital and not in a department’s Operations?

e. Why is #20, using consultants to facilitate data migration and records management and teaching of staff how to use the processes, included in Capital and not in a department’s Operations?

f. Why is #22, hiring a consultant for a new Official Plan included in Capital and not in a department’s Operations? Is the amount $225,000 accurate as the ask for #22, a consultant for the new official plan? It is our understanding that staffing and people consultants are Operations expenses and do not meet the criteria to transfer to Capital. Why is this included in Capital and not a department’s Operations?

g. #23 What is the rationale for purchasing a 100-foot aerial ladder truck for Fire Station 3 in one year? The support document for item #23 shows a multi-year timeline, in compliance with the 2020 Fire master Plan, but the total amount is shown as the request. In a separate document I am submitting a total budget costing that removes the $2,600,000 from 2026, and instead assigns $300,000 to 2026 to provide fiscal responsibility to support an order for the aerial truck in 2026, as the supplier may require a deposit on such a large purchase. I recommend financing the truck over 2026 – 2029, with $900,00 each subsequent year. Any surplus in final year can be placed in reserves.

h. Why is there no capital request for funds to be placed in reserve, with a budget line specifying funds for a fire station? If the $1.5 million reserve request includes a fire station, how much is assigned toward a fire station, and where can citizens find the details about what items are in reserve funds?

i. #24 What is a “fire extinguisher training prop”? Is it a real, tactile thing or an educational program, or what? Capital or Operations?

j. #25 Why is the development of a Fire Master Plan, which was most recently produced by emergencymgt.com in 2020, a contracted consulting firm, included in the Capital and not in the Operations budget?

k. #26, Infrastructure Services, states, “…a portion of the funds are being allocated to getting better information for better decision making for better decision-making with our infrastructure, a portion is being allocated to forward looking investments, and a significant portion is being allocated to replacement or rehabilitation of our existing sanitary storm and watermain infrastructure.”

    1. Why is there no amount for the 2026 portion of item #26, Infrastructure Services? What is the total dollar amount of the ask #26 for the 2026 tabled budget?
    2. Why is Portion 1, getting better information, in Capital and not in Operations? How much of the total ask is allocated to this portion?
    3. Is Portion 2, “forward looking investments” an amount placed in interest bearing investment instruments, and if so, is this amount recognized on page 7 within the $1.5 million reserve contributions? How much is this portion of the total of the unspecified 2026 ask for this item #26?
    4. How much of the total ask is Portion 3, “…replacement or rehabilitation”?

l. #30. The Province of Ontario has indicated that it is replacing traffic cameras with traffic calming strategies. Is the tabled amount of $95,000 going to be offset by Provincial Grants? If so, how much are those grants? Are these grants included on page 7 under the heading “Non-taxation revenues”? If so, then the capital portion of #30 remains as an expense.

m. #43, Fleet & Equipment Replacement. The 2025 chart of equipment equals $831,000.

    1. $80,000 for pickup truck 310-15. Will this be replaced and paid for in 2026?
    2. $226,000 for dump truck 306-15. Will it “land at the dealership” in 2026? How much is the chassis amount due in year one? Is year one 2026? How much is the remaining cost, and when is that payment due?
    3. $220,000 for dump truck 302-17. When will this vehicle be delivered and paid for? Does this $220,000 get paid out in 2026?
    4. $110,000 for stake truck 309-14. When will this vehicle be delivered and paid for? Does this $110,000 get paid out in 2026?
    5. $195,000 for dump truck 404014. When will this vehicle be delivered and paid for? Does this $195,000 get paid out in 2026?
    6. Are these prices calculated in 2026 dollars? Are they a result of 3 quotes? Are the prices net, after including HST & municipal rebates?
    7. When the total $831,000 (for the 5 vehicles) from the chart at the top of the Budget Request Form is accounted for in Capital Investment at the bottom, the funds are allocated to a reserve fund and “Water/Wastewater”. Where do these amounts appear in a reserve fund and where in “Water/Wastewater”? Are these amounts recognized on page 7 within the $1.5 million reserve contributions?

This budget document, as tabled lack clarity, detail and transparency for tax payers’ decision making. It must be amended by providing funding sources’ details so that tax payers can reconcile expenditures and revenues producing a “balanced” budget as required by Municipal legislation.

A fair and reasonable person would recommend that the 2026 budget approval process, moving forward, from now, be changed to facilitate KPMG’s ability to review and amend these apparent discrepancies, provide fulsome rationale in answer to submitted questions, and produce accurate documents for review and comment, amendment by councillors and the tax payers (at Townhalls) of Wilmot.

There is a legitimate process for extending “urgency” deadlines. The mayor needs only to declare in writing that they are sharing powers among Council as a body, and the budget is no longer a “strong mayor’s budget” and becomes a “Council (of 6) budget”. The 30 days after tabling deadline disappears and democratic decision making reappears.