December 2024 Board of Health Meeting - 2025 Budget Report Resolution

1. 2025 Mandatory Programs Budget

Overview

The Windsor-Essex County Health Unit (WECHU) is a publicly funded organization; as such, the WECHU has a responsibility to spend funds prudently with the objective of providing public health programs and services as required by the Health Protection and Promotion Act (HPPA) and the Ontario Public Health Standards: Requirements for Programs, Services, and Accountability (OPHS).

The Province of Ontario, more specifically the Ministry of Health, annually grants the WECHU funding to a maximum of 75% of admissible expenditures for its Mandatory Program. In addition, the WECHU receives required contributions from the Corporation of the City of Windsor, the Corporation of the County of Essex, and the Corporation of the Township of Pelee (hereinafter collectively referred to as the Obligated Municipalities) at a minimum of 25% of admissible expenditures.

In August 2023, the Ontario government announced that the province would be moving forward with a strategy to strengthen Ontario’s public health sector. The Strengthening Public Health Strategy aims to optimize capacity, stability, and sustainability in the public health sector. One of the key initiatives of this strategy is clarifying board of health roles and responsibilities through the Ontario Public Health Standards (OPHS). In addition to the anticipation of updated standards, the Ontario government confirmed a 3-year funding strategy for public health units in Ontario of annual increases of 1% in each of 2024, 2025 and 2026.  It was further confirmed that there would be no one-time funding available during this period except funding requests to facilitate voluntary mergers. Also, 50% of the Infection, Prevention and Control (IPAC) Hub funding for 2024/25 has been indicated to continue for the period April 1/25 to March 31/26 but not yet officially approved.

This budget forms the basis of the Annual Service Plan (ASP) and Budget Submission to the Ontario Ministry of Health. In 2024, the WECHU initiated and implemented an organizational priority setting exercise process to systematically assess program requirements, needs and impacts.  As a result of this work and in anticipation of the new 

standards, the WECHU made changes to its organizational structure coming into effect January 2025.   From a budget perspective, these changes result in a restructure of how FTEs are categorized within the ASP and re-aligns program dollars to priority areas.  Augments to areas include emergency management, health equity, immunization and substance use prevention.  This budget includes 2 additional FTEs to support the new standards.  The changes also support risk mitigation plans for the organization as required in the public health governance model in the OPHS.

In 2024, Di Maio Design Associates Architect Inc. was engaged to conduct a space needs assessment and optimization plan. The needs assessment and optimization plan recommendations will be completed by the end of 2024.  The 2025 budget includes a $535K capital plan to optimize, retrofit and renovate the existing Windsor office location to allow improved access and accessibility for clients as well as renovations to existing spaces to improve program and service functionality for staff. 

For the period January 1, 2025 to December 31, 2025, the proposed budgeted total net expenditures are $25,207,000 representing a 1.0% increase over the 2024 Budget.

Mandatory Programs Budget – Comparison of 2025 Budget to 2024 Budget

Analysis of Budget Changes

1.   Salaries - Increase of $236K or 1.49%
   The salaries budget includes 2 additional FTEs and an average wage increase of 2.5%.  The impact of the FTE increase was tempered through the shifting of  FTE salaries to 100% funded programs including the Infection Prevention and Control (IPAC) Hub and the Healthy Babies Healthy Children (HBHC) program funded by the  Ministry of Children, Community and Social Service (MCCSS)).A budget increase in 2024 – 2025 for our HBHC program of $192K or 6.8%, provided an opportunity to improve service delivery for our at-risk families in the community. Both programs are funded outside of the Mandatory Programs Budget.  This budget also factors in the historical number of resignations, leaves of absence and maternity leaves that impact the salaries budget.
2. Benefits – Increase of $123K or 2.62% 
   The increase in employee benefits is in direct correlation with the negotiated annual salary adjustments across the organization’s employment agreements.  Also, the increase is partially attributable to higher statutory and group benefit rates.
3. Professional Fees - Decrease of $304K or 62.21%
   In the prior year, there were costs set aside for the potential relocation project.  As a result of the project not proceeding, a reduction in this line item in the 2025 budget explains the majority of the year over year difference.
4. Supplies – Programs and Corporate – Decrease of $110K or 10.1%
   As a result of organizational changes, the initial planning, development and implementation phases of new programs will be prioritized in 2025.  The program supply budgets required for programs in this state will be initially lower than future state needs.  We anticipate that the 2026 program supply budget needs will progressively return to more historical values, reflective of fully developed program and service plans.
5. Purchased Services – Programs and Corporate – Decrease of $162K or 54.3%
   In the prior year’s budget, a project manager was budgeted to facilitate the potential relocation project and there is no requirement this year resulting in a decrease of approximately $92K. The other main item was a $47K decrease in spending with a local service provider related to harm reduction.
6. Information Technology - Increase of $96K or 16.8%
   The 2025 budget includes more investment on IT driven projects, aligned with risk mitigation plans, including cyber security investments and hardware/software upgrades that will enhance our security, and replace several pieces that are “end of life”. This is a key focus on reducing organizational risk.
7. Building Maintenance – Increase of $548K or 315.6%
   The main reason for the increase is the budget of $535K for the Space Optimization Project.  As the WECHU will be operating out of the current space for the next 3-5 years, the current facility will need capital spend to optimize the existing space to improve the efficiency of program delivery for both the staff and the clients of the WECHU.  This project will also include a complete renovation of the interior including flooring, painting and lighting that has not been refreshed in decades along with more meeting space and centralized storage. Further, the project will address AODA compliance issues.  This budget also includes upgrades to office furniture to support a healthy and safe work environment that is configured appropriately and ergonomically and reflective of the organization’s hybrid work policy.
8. Rent - Decrease of $61K or 6.8%
   The decrease is attributable to the termination of the SafePoint lease at 101 Wyandotte St. East net of increases in rent at the Windsor and Leamington offices.
9. Offset Revenue – Increase of $102K or 18.9%
   The main reason for the increase is that interest revenue of $150K as interest revenue was not budgeted in 2024.  This was mitigated by a decrease in the program recovery of building occupancy costs that were higher in the prior year.

2025 Mandatory Programs Budget Funding

The funding from the Ministry of Health is $17,916,832 which is consistent with the base funding in 2024 of $17,739,438 with an increase of 1%.

The proposed increase of $72,180, (1%) in the contributions from the Obligated Municipalities results in a Municipal funding contribution of 28.9% which is also consistent with 2024.

The table below details the contributions from Obligated Municipalities for the 2025 and 2024 fiscal years. Contributions are calculated based upon the proportionate share of the population in our catchment area.

The table below details the contributions of the Ministry of Health and the Obligated Municipalities for the 2025 Mandatory Programs Budget.

2. 2025 Ontario Senior Dental Care Program (OSCDP) Budget

Overview

The Ministry of Health annually provides funding for 100% of the admissible expenditures for the Ontario Senior Dental Care Program.

In 2024, the Board of Health approved a budget of $3,115,400 for the OSDCP.  When the funding allocations were sent out by the Ministry of Health in March of 2024 only $3,032,800 was approved leaving a shortfall of $82,600.  In October 2024, there was communication from the Ministry of Health that the OSDCP funding was under review in order to evaluate the impact of the Federal Seniors Dental Plan. The direction from Ministry officials was to budget the same amount for 2025 that was approved in 2024.

For the period January 1,2025 to December 31,2025 the proposed budgeted total net expenditures for the OSDCP are $3,032,800 representing a 2.6% decrease from the 2024 OSCDP Budget of $3,115,400.

Analysis of Budget Changes

1. Salaries – Decrease of $32K or 2.1%
   The decrease is due to the reduction of the equivalent of one FTE dentist and one denturist which were reallocated as independent contractors and are now included in the Purchased Services budget.  This is partially offset by an additional Manager in the department to manage our community dental provider referral program which is implemented throughout the year to efficiently use department salary gapping dollars to keep client wait times as low as possible.  Additional management oversight was also required for this large team which operates a clinical service spanning two locations and two shifts (days and afternoons) in the Windsor office.
2. Clinical Supplies – Decrease of $62K or 21.4%
   The decrease in supplies reflects the reclassification of this line to be specific to supplies used in clinic services rather than the overall operations of the program.  Additional costs outside of this classification (e.g. independent contractor agreements with dentists) are reflected in an increase in the Purchased Services budget.
3. Purchased Services – Increase of $122K or 21.8%
   The increase is the conversion of the part-time dentists and the denturist from employees to independent contracts and the reclassification of existing budget dollars for consistency within this budget line
4. Occupancy Costs – Decrease or $88K or 41%
   The decrease reflects a reset of occupancy costs that were initially contemplated as part of the relocation project that did not proceed.

3. Budget Challenges and Risks

1. Change Management – Organizational Structure
   The 2025 Mandatory Programs Budget reflects the restructuring of departments and the introduction of new programs to address the most urgent local public health needs.  Given the organization’s state of change, actual costs will not be fully known until later in the year and may be higher than what was budgeted.

2. Salary Increases Greater Than Funding Increase
   The 2025 salaries budget did not increase to the extent of wage increases due to salaries being charged to the IPAC Hub (approximately $300K) and an additional amount of $175K reallocated from the Mandatory Programs Budget to the Healthy Babies Healthy Children program funded by the Ministry of Children, Communities and Social Services. A budget increase in our HBHC program provided an opportunity to improve service delivery for our at-risk families in the community.  The risk lies with the IPAC Hub funding which is based on an April 1/24 – March 31/25 year. The budget for the IPAC Hub was submitted in early June and as of mid-November has not been officially approved.  The Ministry has indicated that for the year April 1/25 to March 31/26 that only half would be considered base.  This budget assumes only 50% for the period of April 1/25 to December 31/25.  The risk is if the funding does not meet what we have budgeted.

   Another reason why the salaries budget did not rise as much as the average wage rate increase of 2.5% was an assumption built into the budget regarding historical resignations, leaves of absences and maternity leaves.  Although the factor built into the budget is very conservative, based on historical trends there is a remote possibility that there will be significantly lower gaps created by these types of permanent or temporary departures than has historically been the case.

3. COVID Funding
   At the end of the first quarter the Ministry of Health indicated that there would be one-time funding (Apr.1/24 – Mar. 31/25) for both COVID and RSV.  It was confirmed in early November 2024 that only RSV would be funded and that any COVID costs of administering and managing COVID vaccine as well as managing outbreak control would need to be absorbed in the Mandatory Programs Budget. Although we will be able to absorb these costs in 2024 there is a risk that in 2025 depending on community need and provincial prioritization of vaccination and surge response, we do not have adequate available budget dollars to cover the associated increased costs.
4. Regional Population Growth
   Over the last two years the Windsor-Essex area has experienced significant population growth.  The rate of population growth has long-term impacts on public health service and healthcare needs.  Changes in our populations age composition, priority populations, density and health behaviours require us to be responsive and adaptive to emerging local population health demands.  This changing landscape within which we operate may result in new or different program and service demands that vary from what is currently planned, resulting in adverse impacts on our operating expenditures. 

4. Management Actions to Respond to the Challenges and Risks

1. Conservative Assumptions
   As indicated above, the budget includes a conservative estimate of resignations, leaves of absences and maternity leaves.  The estimate only considers average time to fill the roles.  The fact that all non-management roles are budgeted at the maximum rate adds a significant amount of conservatism and protection as new employees or contract employees hired do not start at the maximum rate in the vast majority of cases.
2. Ongoing Population Health Assessment
   The WECHU remains committed to population health assessment and surveillance activities as defined in the OPHS to ensure that local public health practice is informed to effectively identify and address current and evolving population health issues.  The WECHU remains committed to the maintenance and improvement of the health and well-being of the population, including the reduction of health inequities.  This at times will require the WECHU to adapt program and service operations and the associated budgeted dollars to ensure efficient and responsive operations.
3. Monthly Review by the Leadership and Management Team
   New reporting has been developed which details monthly actual expenditures against budget by line item and by department.  Monthly, the Leadership Team will review this report and take action as needed.  
4. Quarterly Reporting to the Audit Committee and to the Board of Health
   The budget vs. actual results will be reviewed in detail quarterly with action plans reported as needed.
5. Space Optimization Plan
   This large capital item with a $535K budget will be structured in phases and won’t commence until Q2.  The project will be reviewed based on the results as of March 31/25 and decisions will be made to defer some or all of the phases.  Also, we will work with the Landlord and the Ministry to develop options for cost participation to lessen the financial burden on the WECHU.

Proposed Motion

Whereas the Windsor-Essex County Health Unit receives grants annually from the Ministry of Health to a maximum of seventy (75%) percent of admissible expenditures associated with the Mandatory Program. In addition, WECHU receives required contributions from the Obligated Municipalities at a minimum of twenty-five (25%) percent of admissible expenditures, and

Whereas the Ministry of Health annually provides grants for certain related health protection and promotion programs at a rate of one hundred (100) percent of admissible expenditures.

Now therefore be it resolved that the Windsor-Essex County Board of Health approve the 2024 Mandatory Program Budget, requiring $17,916,832(71.1%) in base funding from the Ministry of Health and $7,290,208 (28.9%) in contributions from the Obligated Municipalities, the Corporation of the City of Windsor, the Corporation of the County of Essex, and the Corporation of the Township of Pelee, be approved.

Further that the Windsor-Essex County Board of Health approve the 2024 Mandatory Program Budget with total expenditures of $25,207,040, and offset revenue of $644,800, and

Further that the Windsor-Essex County Board of Health approve the 2024 Ontario Seniors Dental Care Program, funded at a rate of one hundred (100) percent with total budgeted expenditures of $3,032,800.