HomeMy WebLinkAboutCS 11-03
REPORT TO FINANCE &
OPERATIONS COMMITTEE
Report Number: CS 11-03
Date: February 12, 2003
From:
Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject:
Fund
Establishment of the Third Party/Developer's Contributions Reserve
Recommendation:
1. It is recommended that Report CS 11-03 from the Director, Corporate Services &
Treasurer be approved and that:
2. Council approve the establishment of the Third Party/Developer's Contributions
Reserve Fund;
3. the attached By-Law be read three times and passed;
4. funds currently paid by Third Party/Developer's Contributions Reserve Fund
for future capital commitments be transferred to this Reserve Fund and all such
future payments be deposited in this fund; and,
5. the appropriate officials of the City of Pickering be authorized to take the
necessary actions to give effect thereto.
Executive Summary:
Not applicable
Financial Implications: Developer's contributions are funds received to fulfill
commitments developers are unable to meet, usually for reasons beyond their
control, at the time the development is under way. Payments are cash-in-lieu of the
work for mostly small matters such as a section of sidewalk, fencing, tree planting,
driveways, utility relocations and/or any other deficiencies that developers are unable
to fulfill at that time. They are in essence paying the City for their share of the work to
be done in the future.
Unless specified, the City is under no obligation to pay interest to any third parties.
However, with the establishment of a reserve fund, moneys raised will be invested as
prescribed under the Municipal Act and any interest earned will remain as part of the
fund to assist in offsetting inflationary increases in costs.
Report CS 11-03
Date: February 12, 2003
Subject: Establishment of Third Party/Developer's
Contributions Reserve Fund
Page 2
The availability of revenue in this reserve fund will provide funding on capital projects
in areas of sidewalks, external subdivision works, the fire hall and any other specific
purposes. Cash-in-lieu for various purposes will also be pooled in this reserve fund.
The City must commence setting aside funds for these and other important or legally
required capital expenditures. By doing so the City's financial commitment is
demonstrated to present and future funding partners.
Background: Prior to 2002, developers contributions received were credited to a
deposit account called" Funding - Subdivision Compliance". Funds were transferred
to pay for the designated projects as the expenses were incurred. Interest was never
credited to this account unless specified in the agreement with the developers or
third parties. Funds received in advance for future commitments should be invested
with the interest earned being retained in the Reserve Fund.
Under the Municipal Act, 2001, S.O 2001, section 417, every municipality may in
each year provide in its budget for the establishment or maintenance of a reserve
fund for any purpose for which it has authority to spend money. As the establishment
of this reserve fund does not have any budgetary implication as it involves third party
funding previously received by the City, it can be established now.
Third Party/Developer's contributions will be administered through the establishment
of a Reserve Fund under the Municipal Act. The operation of this fund will be
governed by the attached by-law. The By-Law will be governed by the provisions of
the Municipal Act, and Regulations thereunder, specifically Section 417(1) regarding
the establishment of the Reserve Fund, Section 417(3) regarding the investment of
funds and Section 417(4) the expenditures of the reserve fund.
Attachments:
1.
Third Party/Developer's Contributions Reserve Fund By-Law
Report CS 11-03
Date: February 12, 2003
Subject: Establishment of Third Party/Developer's
Contributions Reserve Fund
Page 3
Prepared By:
Q~
Caryn Kong
Senior Financial Analyst
Treasurer
GAP:vw
Attachment
Copy: Chief Administrative Officer
Recommended for the consideration of
Pickering City Council
Approved I Endorsed By:
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Gillis A. Paterson
Director, Corporate Services &
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THE CORPORATION OF THE CITY OF PICKERING
BY-LAW NO.
/03
Being a by-law to provide for the establishment of a
Reserve Fund to be known as the Third
Party/Developer's Contributions Reserve Fund.
WHEREAS under the Municipal Act, S.O., 2001 as amended, Section 417(1),
the Council of the City of Pickering may establish and maintain a reserve fund for
any purpose for which it has authority to expend funds.
WHEREAS it is desirable for the City of Pickering to establish such a reserve
fund for the purpose of receiving funding from developers for the payment of
future capital commitments on behalf of developers.
WHEREAS it is desirable for the City of Pickering to establish such a reserve
fund for the purpose of receiving funding from any third parties for contributions
towards future capital projects or undertaking that may be considered and
approved by Council.
NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE CITY
OF PICKERING HEREBY ENACTS AS FOLLOWS:
Wayne Arthurs, Mayor
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1.
The establishment of a reserve fund known as the Third Party/Developer's
Contributions Reserve Fund is hereby authorized.
2.
The Third Party/Developer's Contributions Reserve Fund shall consist of
such moneys paid by developers and third parties and such other funds
as the Council may approve together with the investments made and
earnings derived there from for the specific purpose of fulfilling future
capital commitments.
3.
The Third Party/Developer's Contributions Reserve Fund shall be used for
the purpose of paying expenses related to capital projects as defined
under agreements or such other projects as the Council of the City of
Pickering may approve.
4.
This By-Law shall come into force on the date of its enactment.
BY-LAW read a first, second and third time and finally passed the 3rd day of
March, 2003,
Bruce Taylor, Clerk