2018 Operating and Capital Overview

Transcription

1 2018 Operating and Capital Overview 33

2 2018 Operating Budget Total budget $ 378.2M Less: Non-tax revenues 137.7M Payments in lieu 16.3M Assessment growth 2.1M Supplementary taxes 1.8M 157.9M Net taxation $ 220.3M

3 ECONOMIC & MARKET CONSIDERATIONS

4 CPI Ontario October 2016 October 2017 CPI All Items 2.1% 1.3% Energy 5.6% (2.0%) CPI excluding energy 1.7% 1.6% Bank of Canada target 2% TD Economics Outlook for Ontario CPI 1.7% in 2018 and 2.0% in 2019

5 Economic and Market Considerations (TD Economics) Canadian dollar expected to average in low 80 cent range against US$ throughout 2018 Canadian Economy Real GDP growth projected 3.1% in 2017; 2.0% in 2018 Bank of Canada overnight rate projected to rise to 1.75% by end of 2018 (currently 1.0%) Lower commodity prices to continue through 2018

6 Budget Considerations Interest rates Operating revenues reflect short term rates projected to remain relatively low through 2018 Long-term rates Investment models remain at 3% Borrowing strategies continue to be monitored Cdn$ US$ Exchange - $1.28 Canadian expected to remain in that range through 2018 Still relatively high in historic terms, causing pressures in operating and capital spending

7 MUNICIPAL OPERATING BUDGET COUNCIL REPORT

8 Total Taxation Revenues and Assessment Growth 2018 $M % increase Taxation Revenue Assessment Growth Supplementary Taxation The recommended 2018 budget reflects a net tax requirement of $224.2M, or a 3.8% increase over 2017 net taxation revenues Projected assessment growth contributes $2.1M, supplementary taxation contributes $1.8M; the remaining $220.3M represents an average tax rate increase of 2.5% over 2017 levels Final tax bill increase will vary depending on property assessment shifts, impacts of tax ratios established as well as changes in education tax

9 Operating Budget Revenues Transfers from Reserves (-8.5%) PIL Revenue (3.3%) Government Grants and Transfers (9.1%) Fees and Charges (5.3%) Taxation Revenue (3.8%)

10 Operating Budget Expenditures Internal Allocations and Tax Adjustments (27.4%) Transfers to Agencies and Boards - operating (3.6%) Transfers to Reserve Funds (5.3%) Grants and Transfers to Others (10.1%) Contracted services (-2.5%) Supplies, Materials, Rents and Other (4.8%) Salaries, Wages and Benefits (3.7%)

11 Bill 148 Fair Workplace, Better Jobs Act, 2017 Received Third Reading November 22, 2017 Range of changes to ESA and LRA Changes proposed to: Minimum wage Entitlements for personal emergency leave for PT employees Statutory holiday compensation calculations Minimum on-call pay (added exemption for delivery of essential public services such as fire, utility and snow removal) Equal pay for equal work provisions Other non-staffing cost considerations

12 Fuel Budgets 2018 fuel budgets include: - 3.0% price increase for regular gas and diesel; 4.6% price increase for B5 and B20 bio-diesel (average) - Increased volumes for transit service enhancements (Phase 1 annualized; Phase 2 starting May 2018) - Contingency for price variance, phase-in effects of senior government cap and trade programs; and to manage volatility in future years - Future price estimates budgeted in the 3% range

13 Fuel Budgets 2017 Budget rate 2018 Budget rate % Pump price equivalent Regular gas % 1.26 Regular Diesel % 1.26 Bio diesel % 1.20

14 Agencies and Boards Operating Budget Request Cataraqui Region Conservation Authority (draft only) 4.2% Tourism Kingston 12.5% KEDCO 1.5% Kingston Access Services 0.6% Kingston Frontenac Public Library Board 2.7% Kingston Police Services Board 3.6% Downtown Business Improvement Area (separate levy) 4.7% KFL&A Public Health 1.5% County of Frontenac - Land Ambulance (draft only) 3.5% County of Frontenac - Fairmount Home for the Aged (draft only) 19.3%

15 2018 Recommended Capital Budget & Financing $M $M Proposed Capital Expenditures 58.3 Financing: Municipal Reserve Funds 42.6 Government Grants 4.5 Contributions from Others 4.2 Issuance of Long-term Debt

16 2018 Capital Budget $58M recommended capital budget Included in 2018 Plan Buses for enhanced transit service - $3.7M (Phase 3) Kingston East Community Centre $10.5M $300K investment in waterfront master plan Investment of $2M of $8M council approved 5 year housing commitment $3.8M provincially funded programs for social and affordable housing Kingston East library expansion - $4.6M $7M Issuance of long term debt continue to remain within debt ceiling until 2020

17 2017 Standard & Poor s Credit Rating S&P affirmed AA Rating with stable outlook Acknowledgment of prudent debt and related policies that keep debt accumulation manageable and after-capital deficits controlled KPIs: Debt levels: to remain below 120% of consolidated operating revenues; Capital spending: after-capital deficits averaging less than 10% of adjusted total revenues

18 Approved Debt By Source Projected Debt Tax Supported ($M) Utility Rates ($M) User Charges ($M) Total ($M) Debt issued to date Debt approved but not yet issued to date Total approved debt at October Debt issuance as per 2018 budget Estimated Annual Debt Repayments ( ) (16.1) (8.3) (4.6) (29.0) Projected balance at Dec 31, Percentage by source 40% 41% 19% 100%

19 Debt Level Forecast