Financial Statements December 31, April 24, 2017

Transcription

1 Financial Statements December 31, 2016 April 24, 2017

2 Operating & Water Works & Wastewater Contributions to/(from) Reserves Summary General Deficit (Tax Stabilization Reserve $587,234) $ (879,759) (WSIB Future Benefit Cost $292,525) Water Works Deficit (Water Works Reserve) $ (152,355) Wastewater Works Deficit (Wastewater Works Reserve) $ (39,165) $(1,071,279) Other Transfers to/(from) Reserves: Parking Reserve Fund (YE Operating Deficit) ($ 10,074) Supplementary Taxation: Did not meet budget in 2016, therefore no contribution to Reserves was made. Page 2

3 Consolidated Statement of Financial Activities 2016 REVENUE Taxation 37.9% Grants and Transfers 33.6% Fees and Services 22.8% Other Municipalities 4.1% Other 1.6% 2016 Actual 2015 Actual Variance Taxation 67,791,862 66,611,892 1,179,970 Grants and Transfers 60,128,804 60,432, ,098 Fees and Services 40,752,898 40,417, ,297 Other Municipalities 7,311,669 7,051, ,713 Other 2,873,969 3,052, , ,859, ,566,928 1,292,274 Taxation Variance In 2016, Council approved a levy increase of 3.0% or $1.9M. The City saw growth of $1.7M, and a decrease of $945K in supplementary taxation. Grants Variance The decrease in Grants is related to reduced OMPF funding. The OMPF funding was reduced by 15% ($861K) from 2015, this decrease was partially off-set by Cornwall SDG Paramedic Services and the Community Para-Medicine Program; Police: Court Services upload. Fees & Services A decrease in Water billings ($14K) and an increase in Wastewater billings ($305K). Page 3

4 Consolidated Statement of Financial Activities 2016 EXPENDITURES Social & Family Services 37.7% Protection & Health 24.5% Transportation Services 12.9% Environmental Services 10.1% Recreation & Cultural Services 8.9% General Government 4.8% Planning and Development 1.2% 2016 Actual 2015 Actual Variance Social & Family Services 68,572,963 68,006, ,460 Protection & Health 44,518,524 42,796,541 1,721,983 Transportation Services 23,393,820 22,603, ,409 Environmental Services 18,431,302 17,627, ,255 Recreation & Cultural Services 16,098,301 15,404, ,829 General Government 8,705,654 8,133, ,196 Planning and Development 2,164,290 2,260,443-96, ,884, ,831,875 5,052,979 Protection and Health Increase costs related to salaries and benefits for Cornwall SDG Paramedic Services and the Community Para-Medicine Program which was offset by MoH revenue; an increase in overtime for Fire Services and future employment benefits. Environmental Services Increase costs in Water and Wastewater: related to LTD for Brookdale and the WWTP, additional funds for the Secondary Wastewater Treatment Plant. Page 4

5 2016 City Capital Fund Summary Capital Fund Jan 1, 2016 Roads Transit & Solid Protective Software Water & Infrastructure MW Garage Waste Facilities Parks Services GSDL Upgrade Sewer Total (229,204) (704,667) 234, ,720 (178,968) 1, ,372 70,655 (8,508,825) (8,695,123) Taxation 950, , , , ,676 59, ,626 87,649 2,641,868 Water Billings 57,414 2,967,641 3,025,055 Sewer Billings 17,500 3,403,821 3,421,321 Fed/Prov Gax Tax 3,042, , , ,000 3,607,224 Reserves 76,513 55, ,789 86, ,626 34,976 79, ,000 1,856,506 WWTP Prov. Funding - WWTP Fed. Funding - Provincial Funding 169, ,588 30,000 1,200,000 1,502,705 United Counties 67, , ,399 Recoveries 2,616 3,944 9, , ,601 Sale of Land (Si Miller) - Debt Financing 2,000,000 1,745, , ,000 13,400,000 18,225,000 Misc 8,811 13,959 22,770 TOTAL Revenue 6,238,888 2,213, ,660 1,013,799 1,265, , , ,803 21,681,318 34,824, Expenses (7,648,526) (2,178,634) (235,907) (1,088,407) (1,002,650) (1,271,951) (837,466) (377,899) (10,665,031) (25,306,471) Capital Fund Dec 31,2016 (1,638,842) (669,925) 421, ,112 84,348 (319,397) 93,471 84,559 2,507, ,855 Long-term financing for the expansion of secondary treatment at the Wastewater Treatment Plant (WWTP) has been secured in Page 5

6 Category of Reserves City Reserves & Reserve Funds 2015 Year End 2016 Year End Commentary Operating Reserves $6,655,523 $6,311,183 The reduction is primarily related to utilization of the Tax Stabilization Reserve (net $187k) and the purchase of a dispatch console ($160k)to be paid back over 4 years. Capital Reserves (105,018) (1,463,514) The City used the Land Reserve to repurchase land in the Business Park ($2.2M). The remaining capital reserve balances as a whole are in a positive position, but remain well below the target balance. This is an area that is frequently underfunded due to competing budgetary challenges. Restricted Reserves (Municipal Funding) Restricted Reserves (Funded Externally) $41,515,414 $40,909,940 Reserves restricted for certain uses; such as, the Water and Wastewater Works Reserves, Downtown Investment Fund and the Progress Fund. $5,635,403 $4,929,941 These reserves have been funded by senior levels of government or third parties for specific uses. A report on the status of City Reserves is provided to Council annually at the same time that the City s Financial Statements are presented. The report will provide Council details on the status of Reserves and how they are performing to target balances. Page 6

7 Consolidated Schedule of Tangible Capital Assets (by category) Assets In Service Accumulated Assets Under Net Book % (original cost) Amortization Construction Value of Cost Land $ 12,253,104 $ (74,176) $ - $ 12,178, % Yard 9,636,419 (2,811,221) - 6,825, % Buildings 173,828,074 (66,986,274) 256, ,098, % Infrastructure 152,201,790 (69,768,730) 1,914,176 84,347, % Water & Sewer 161,039,223 (40,544,462) 4,056, ,551, % Machinery/Equipment 120,774,038 (80,897,648) 281,015 40,157, % Computer 4,366,617 (2,894,188) 85,141 1,557, % Vehicles 21,385,226 (12,002,266) 397,972 9,780, % Office Furniture 5,427,272 (3,554,340) - 1,872, % Other 2,027,758 (1,051,273) - 976, % $ 662,939,521 $ (280,584,578) $ 6,991,113 $ 389,346, % The Net Book Value is the original cost of an asset less any accumulated amortization. Overall, the Net Book Value of City assets are 58.73% of the original asset cost. Page 7

8 Asset Management The Asset Management Plan was approved by Council in Nov 2016, and is summarized as follows: Financing Strategy State of Local Infrastructure 2016 Estimated replacement value, $1.3B Annual contribution for replacement of assets, $27.9M Current asset backlog, $92.3M Asset Management Strategy Expected Levels of Service Annual capital investment required to maintain current assets, $13.7M Currently, funding for capital maintains the current asset base but does not plan for the replacement of assets. Continuing in this manner will result in a funding shortfall of $53M over the next 10 years. The City s Long Term Financial plan will provide a framework of best practices and guidelines. It will measure the City s financial capacity to meet the strategic plan and capital works plan and provide planning for life cycle costing. Page 8

9 Long Term Liabilities Consolidated long-term liabilities at December 31, 2016 includes: Bank Loans $36,277,280 Capital Leases (Computer Equipment) $57,728 Cornwall Area Housing Corporation (mortgages funded from MMAH) $5,309,908 PSAB Liabilities (Future employment benefits ($6.7M); $8,416,170 Landfill Closure/Post-Closure Costs ($1.6M); Accrued interest ($27K) Long-term Accounts Payable (OMEX) $227,735 Internal Loan - Land in the Business Park $2,000,000 $52,288,821 Sources of future revenues to finance liabilities are as follows: General municipal revenue $34,343,460 Proceeds from the sale of land $2,000,000 Reserves and reserve funds $10,635,453 Provincial grant revenues $5,309,908 $52,288,821 Page 9

10 Long Term Liabilities Bank Loans Bank Loans at December 31, 2016 includes: Vehicles and Equipment Municipal Works $2,670,878 Fire Services $1,301,998 Police Services $423,390 Transit Services $1,226,236 EMS (Defibs) $93,476 Recreation Services $885,244 $6,601,222 Municipal Facilities Wastewater Treatment Plant $11,365,823 Benson Centre $8,827,854 EMS Facility $1,194,188 $21,387,865 Police Post-Employment Loan $1,504,933 LED Streetlighting $1,980,900 Brookdale Ave North Channel Bridge $1,985,227 Flood Reduction Initiative $2,817,133 Total $36,277,280 In 2016, annual repayment on principal for long-term debt is approximately $2.2M, of which $1.2M is funded from the tax base. Annual interest for bank loans is estimated to be $653K, of which $160K is funded from the tax base. Page 10

11 Annual Principal and Interest Payments Est. YE Department 2015 Principal Interest 2016 Total 2017 I.T. Services ,000 Fire Services (Vehicles) 330, ,052 22, , ,130 Police Services (Veh. & Sick Benefit) 379, ,699 59, , ,629 Municipal Works (Veh. & Equip.) 536, ,316 69, , ,440 Municipal Works (Yard) ,300 Recreation (Civic Complex Eqp, Riverdale Splashp 14,976 21,314 3,620 24, ,211 Parks and Landscaping (Emerald Ash Borer) 0 5,248 1,017 6, ,900 Infrastructure Planning (LED Project, Marleau) 0 19,100 3,666 22, ,400 1,261,449 1,179, ,966 1,339,695 2,420,010 Debt Repayment is funded by: Tax base Transit Services (Buses) 0 78,764 29, , ,042 EMS (facility & Defibs) 224, ,743 41, , ,387 Benson Centre 719, , , , ,388 Secondary WWTP 0 34,177 30,527 64, ,500 Brookdale (North Channel Bridge) 0 14,773 4,044 18, ,400 Fennel Cr. Pumping Station ,500 Cornwall Blue Print Initiatives 243, ,896 78, , , , , , ,683 1,575,113 Provincial Gas Tax 50% MoH, 30% County, 20% City (Tax base) Progress Fund interest Wastewater Billings Total 2,449,141 2,185, ,853 2,839,804 5,150,940 The City continues to benefit from low interest rates. Page 11

12 2016 Summary The City had an operating deficit of $879,759. This deficit was funded by transfers from the Tax Stabilization Reserve $587,234 and the WSIB Reserve $292,525. The City had a deficit in Water Services of $152,355. This deficit was funded from the Water Works Reserve. The City had a deficit in Wastewater Services of $39,165. This deficit was funded from the Wastewater Works Reserve. The City utilized $2.2M of the land reserve to purchase property in the business park. Temporary borrowings were obtained to fund the purchase with all proceeds from the future sale to be returned to the land reserve. The City entered into Financing Agreements (long-term debt) for the sum of $18,225,000 for the WWTP, Brookdale North Channel Bridge, LED Streetlighting, Riverdale Splash Pad, Equipment and Vehicles for MW, Police, Transit and borrowed for the Emerald Ash Borer project. City Reserves and Reserve Funds total $50.6M. Tax refunds related to Minutes of Settlement, as well as vacancies and adjustments were $2,322,495 ($803,000 in 2015). The City s financial position continues to be strong. Page 12

13 2017 Initiatives Financial Services is currently developing a 10-year Financial Plan relating to forecasted operating and capital requirements that would identify sources of available funding (such as: tax base, water and wastewater billings, debt financing, government grants, use of reserves, etc.). Financial Services is upgrading the City s Water and Wastewater billing and the Accounting systems. The Development Charges background study is being completed by Watson and Associates. The study will provide recommendations for a fee structure. Development Charges provides funds that would allow the City to finance capital works required for development. A review of the Building Permit Fee structure is being undertaken in It is anticipated that the new fee structure will expand on fee for service concepts and establish an annual inflation base increment mechanism. The city is looking to implement a new electronic data management system. This system would be a central depository for all city departments to store documents for short and long term uses. Page 13