HomeMy WebLinkAboutCS 24-08
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REPORT TO
EXECUTIVE COMMMITTEE
Report Number: CS 24-08
Date: June 9, 2008 !),~
From:
Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject:
2007 Pre-Audit Balances of Reserves and Reserve Funds
Recommendation:
That Report CS 24-08 of the Director, Corporate Services & Treasurer be received for
information.
Executive Summary: Based on the preliminary 2007 results, we can now report on
the pre-audit actual activities within the Reserves and Reserve Funds for 2007. A
summary is presented in Appendix A.
The purpose and 2007 financial transactions for each Reserve and Reserve Fund are
set out in Appendices Band C respectively.
Financial Implications: Not applicable
Sustainability Implications: Funds available under the Reserves and Reserve Funds
provide partial financial support towards the sustainability of Pickering in both capital
and operating expenditures.
Background: As in previous reports filed over the years, this report provides specific
information on each of the City's Reserves and Reserve Funds, including year-end
balances. The 2007 pre-audit Reserves and Reserve Funds balance of $53,809,076 is
one of the highest balances ever reported in Pickering. However, this balance is not
fully available for use due to the outstanding budget commitments of funds not yet
spent, the obligations connected with the collection of funds or other specific purposes
approved by Councilor under Provincial Legislation.
With regard to unspent budget commitments for capital projects, we are continuing the
practice of not transferring funding for commitments until the expenditures are incurred.
This procedure allows the Reserve Funds to earn interest income as long as funds are
still in the Reserve Fund's custody and is in compliance with Public Sector Accounting
Report CS 24-08 Date: June 9,2008
Subject: 2007 Pre-Audit Balances of Reserves and Reserve Funds Page 2
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Board (PSAB) for obligatory Reserve Funds. The combined unspent budget
commitments for all Reserve Funds are $6,298,370.
The City's share of collections from OPG related to properties under assessment appeal
for the period of 2003-2006 in the amount of $5.098 million has been settled. The City
has officially recognized this amount and these funds have been transferred to the Rate
Stabilization Reserve. These funds can now be used for future budgeting years for both
the capital and current expenditures.
The Development Charges, Parkland, Third Party/Developer Contributions, Ontario
Transit Renewal, Provincial Dedicated Gas, Federal Gas Tax and Building Permit
Reserve Funds represent funds received for specific purposes subject to legislative
requirements and based on developer agreements or agreements with any third parties.
Funds available in these Reserve Funds are obligatory in nature and should be treated
as committed. The balance in these obligatory Reserve Funds is $29,881,927 (See
Appendix A). The combined total of the budget commitments, other restricted balances
and obligatory Reserve Funds of approximately $35 million reduced the "discretionary"
balance to approximately $18 million as at December 31 , 2007.
The City established two new Reserve Funds this year, namely: Animal Shelter
Reserve Fund and Pickering Men's Slow Pitch League Reserve Fund. The purposes of
the Reserves and Reserve Funds are discussed further in Appendices Band C.
Internal borrowings from the Reserve Funds commenced in 2001 to assist in funding
capital projects. The outstanding principal balance as at December 31, 2007 is
approximately $4.18 million. These loans are undertaken from the Development
Charges and Parkland Reserve Funds. The breakdown of the principal balance for both
the Reserve Funds is $3.89 million and $292,000 respectively. This provided the
Reserve Funds with an attractive rate of interest compared to current market investment
rates while at the same time providing a cheaper cost of borrowing to the capital fund.
Interest earned on internal loans represents amounts earned on the 2001 to 2006
internal borrowings. Repayment for 2007 internal borrowings will commence in 2008
and interest earned will be reflected accordingly.
Attachments:
1. Appendix A Summary of Reserves and Reserve Funds
2. Appendix B Description of Reserves
3. Appendix C Description of Reserve Funds
Report CS 24-08
Date: June 9, 2008
Subject: 2007 Pre-Audit Balances of Reserves and Reserve Funds
Page 3
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Prepared By:
~V-o~
Senior Financial Analyst
GAP:ck
Copy: Chief Administrative Officer
Recommended for the consideration of
Pickering CityA;;ouncil
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Approved I Endorsed By:
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Gillis A. Paterson
Director, Corporate Services & Treasurer
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APPENDIX A
CITY OF PICKERING
SUMMARY OF RESERVES AND RESERVE FUNDS PRE-AUDIT ACTUALS
DECEMBER 31, 2007
Pre Audit Audited Audited Audited
Appendix B Summary Reserves 2007 2006 2005 2004
4610 Working Funds 400,000 $400,000 $400,000 $400,000
4611/4623 Replacement Capital 683,214 685,715 722,844 758,175
4612 Contingencies-OPG, Election, Other 2 1,328,080 6,356,615 10,774,909 9,053,320
4613 Self-Insurance 2 951,391 951,391 915,514 940,514
4619 Rate Stabilization 15,491,176 6,910,981 3,388,965 2,619,565
4620 Develop.Charges-City's Share 2 745,244 809,654 484,204 1,921,332
4621 Region Transit 2 120,999 120,999 237,106 1,025,741
4622 Continuing Studies 2 713,821 474,484 342,533 233,159
4624 Vehicle Replacement 122,547 72,547 75,000 25,000
4625 Easement'Settlement 1,095,129
4626 Library Eastern Branch 2 55,000 30,000 20,000
4627 Move Ontario 308,243 833,243
Total Reserves 20,919,715 $17,645,629 $18,456,204 $16,976,806
Pre Audit Audited Audited Audited
Appendix C Summary of Reserve Funds 2007 2006 2005 2004
4225 Community Facilities 180,880 $194,175 $265,492 $380,604
4228 Capital Works 335,486 321,618 309,872 302,610
4229 Development Charges 1 & 2 23,528,009 22,341,331 21,135,306 19,496,777
4230 Parkland 1 &2 1,557,607 1,993,928 2,103,061 2,166,696
4232 Public Works 1,122,707 1,072,893 1,038,206 1,152,444
4234 Workers Safety Insurance Brd 2 1,103,109 834,922 589,575 378,731
4235 Third PartylDev. Contributions 1 2,129,221 1,868,148 1,819,264 1,601,076
4236 Ontario Transit Renewal 1 19,166 19,166 14,035
4237 Squash Courts 2 119,057 78,989 66,087 33,713
4238 Provo Dedicated Gas Tax 1 523,014 771,076 722,039 161,515
4239 Federal Gas Ta~ Revenue 1 2,144,076 1,455,769 850,684
4240 Building Permit Stabilization Fees 1&2
4241 Animal Shelter New 2 146,195
4242 Pickering Mens' Slow Pitch New 2
Total Reserve Funds $32,889,361 $30,952,015 $28,918,752 $25,688,201
Total Reserves & Reserve Funds $53,809,076 $48,597,644 $47,374,956 $42,665,007
Notes
1 Obligatory
2 Restricted
Total Obligatory 1 & Restricted ~ -2007 =
29,881,927 (Includes 4229 & 4230)
5,136,701 (Excludes 4229 & 4230)
35,018,628
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APPENDIX B
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RESERVE FOR WORKING FUNDS 4610
Actual Balance December 31,2006
Transfers into the Reserve
$
400,000
Transfers out of the Reserve
Pre-Audit Actual Balance December 31,2007
$
400,000
1. Purpose of this Reserve:
The reserve for working funds is used to provide operating cash to assist in
avoiding short term interest expenses incurred on operations, typically during the
first few months of the year prior to tax billing and at other times when cash
inflows and outflows do not match as occurs in any corporation.
The interest income on this account forms part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance levels of the Reserve:
It is recommended as a "rule-of-thumb" that this reserve be 2% to 3% of total City
revenues. Based on an average annual revenue of $45 million, at 2%, the
amount to maintain for this reserve should be $900,000.
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APPENDIX B
RESERVE FOR REPLACEMENT OF CAPITAL EQUIPMENT - G/L 4611/4623
Actual Balance December 31, 2006
Transfers into the Reserve
Revenue Fund Contribution
$
685,715
115,462
Transers out of the Reserve
Transfers to Capital Fund
(117,963)
Pre-Audit Actual Balance December 31,2007
$
683,214
1. Purpose of this Reserve:
The purpose of this reserve is to reduce the need to levy for the full cost of major
equipment in the year of acquisition. The reserve acts as a stabilization factor
and helps to avoid both tax rate fluctuations and the issuance of long-term debt
or other means of financing.
The interest income on this account forms part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
This reserve should be kept at a level that is equivalent to the replacement cost
of the assets for which they were established. Over the last couple of years, the
reserve balance has been kept at a minimum level.
Contributions to this reserve are provided for annually in the Current Budget. In
2003, additional sub-categories were set up for accounting purposes to better
match the collection of funds to the application of these funds to particular
facilities as shown on the following page.
APPENDIX B
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The balances pertaining to these sub-categories are as follows:
General Recreation Dunbarton Don Beer Rec Camp Rec Camp Rec Camp
Corp Use Prgrms Pool Arena Core Pool Arena Total
$ $ $ $ $ $ $ $
Dec 31/06 53,859 11 6,252 32,616 104,678 8 1 ,773 166,312 130,225 685,715
Transfers in 0 1 8,500 4,962 30,000 27,000 15,000 20,000 115,462
Transfers out (51,376) (66,587) (117,963)
Dec 31/07 2,483 134,752 37,578 68,091 108,773 181,312 150,225 683,214
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APPENDIX B
RESERVE FOR CONTINGENOES- G/L 4612
(OPG, Other Assessment Appeals, Election, Miscellaneous)
Actual Balance December 31,2006
Transfers into the Reserve
Transfers from Revenue Fund
$ 6,356,615
70,000
Transfers out of the Reserve:
Transfers to Rate Stabilization Reserve
Pre-Audit Actual Balance December 31, 2007
(5,098,535)
$ 1,328,080
1. Purpose of this Reserve:
Like the Capital Equipment Replacement Reserve, this reserve acts in a tax
stabilization capacity. It was established in anticipation of unknown, unusual or
extraordinary expenditures, which occur from time to time.
The interest income on this account forms part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
In 2003, the large balances in this Reserve were reviewed and grouped into sub-
categories in the general ledger, for accounting purposes only, to better
distinguish those amounts that are committed and those amounts available for
general corporate use. The sub-categories are as follows: OPG Assessment
Appeal, Elections, Other Assessment Appeals and Miscellaneous.
The funds related to Contingency-Ontario Power Generation (OPG) Assessment
in the amount of $5,098,535 for assessment appeals related to the taxation years
2003-2006 have been reached and this amount was transferred to the Rate
Stabilization Reserve in 2007. Report to Council CS 47-07 provides detailed
information on OPG Assessment Appeals.
The amounts pertaining to the other sub-categories are as follows: Election-
$70,000 Other Assessment Appeals - $682,594 and Miscellaneous - $575,486.
APPENDIX B
RESERVE FOR SELF INSURANCE - G/L 4613
Actual Balance December 31,2006
Transfers into the Reserve
$
951,391
Transfers out of the Reserve:
Transfer to Capital
Pre-Audit Actual Balance December 31,2007
$
951,391
1. Purpose of this Reserve:
This reserve was established as a necessary form of asset protection.
Specifically, it is to cover insurance claims resulting from the increase in
deductible levels, costs of uninsured claims and other claim related costs. The
higher deductible reduced insurance premiums. Significant savings can be
realized through reduced premium costs and staff analyzes the costs/benefits of
such actions on an annual basis.
The interest income on this account forms part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
This reserve should be maintained at a level to ensure that the funding is
adequate to meet future liabilities. This situation is analyzed by staff on a regular
basis.
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APPENDIX B
RESERVE FOR RATE STABILIZATION - G/L 4619
Actual Balance December 31,2006
Transfers into the Reserve
Excess Surplus Contribution
Transfer from OPG Assessment Appeal Reserve
Dividend from Veridian
$ 6,910,981
3,500,660
5,098,535
1,640,000
10,239,195
17,150,176
Transfers out of the Reserve
2007 Current Budget Provision
(1,659,000)
$ 15,491,176
Pre-Audit Actual Balance December 31,2007
1. Purpose of this Reserve:
The purpose of this reserve is to act as a tax rate stabilization factor for annual
current budget funding.
The interest income on this account forms part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance levels of this Reserve:
The fund balance should be maintained at a level of 3 to 5 per cent of tax
revenues to provide tax rate stabilization for annual current budgeting purposes.
The 2007 Current Budget provided for a transfer in the amount of $1,659,000
from this reserve to fund current expenditures.
With the settlement of OPG assessment appeal, dividends from Veridian and
surplus in the year ended 2007; there is sufficient build-up of funds to draw from
this reserve for future budgeting years. In 2008, there is a budgeted draw of
$2,486,182 and further draws anticipated in 2009 and after.
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APPENDIX B
RESERVE FOR DEVELOPMENT CHARGES - CITY SHARE G1L 4620
Actual Balance December 31,2006 $ 809,654
Transfers into the Reserve
2007 Current Budget Provision 250,000
Transfers out of the Reserve
Transfer to Capital Fund
-External Subdivision Works (277,725)
-Pa rks (36,685)
Pre-Audit Actual Balance December 31,2007 $ 745,244
1. Purpose of this Reserve:
This reserve has been established to set aside funds for projected growth in the
City. From the 1999 and the 2004 Development Charges Studies it was
approved that a Reserve be established for the City's share (i.e. the non-
development charge portion)' of the costs of services included in the
Development Charges Study and that contributions be included in the annual
Current Budget for consideration by Council. For the City to meet its obligations
for the various capital projects, an annual contribution of $2.4 million is required.
The interest incomes on this account forms part of the annual Current Budget
General Government Revenue.
2. Recommended Maintenance levels of this Reserve:
Funds continue to be budgeted in the Current Budget to build up this reserve to
fund future capital growth of the City. The draws in the current year were to
finance Parks and External Subdivision Works. This reserve should be
maintained at a level to ensure that the funding is adequate to meet future capital
growth in the City.
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APPENDIX B
REGION TRANSIT RESERVE - G/l 4621
Actual Balance December 31,2006
Transfers into the Reserve
GO Transit Funding from Region
$ 120,999
Transfers out of the Reserve
Pre-Audit Actual Balance December 31,2007
$ 120,999
1. Purpose of this Reserve:
This Reserve Fund was established in 2002 to capture funds raised by the
Region for transit purposes and not immediately required.
The interest income on this account forms part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance levels of this Reserve:
The Ajax Pickering Transit Authority (APTA) has been officially transferred to the
Reg,ional Municipality of Durham (Region) effective January 1, 2006, thus there is
no longer any revenue from the Region for this Reserve.
The balance of this reserve is expected to be used for any unpaid commitments
or obligations related to APTA. This Reserve will eventually be closed-out upon
settling all our commitments and obligations.
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APPENDIX B
RESERVE FOR CONTINUING STUDIES & CONSULTING - G/l 4622
Actual Balance December 31,2006 $ 474,484
Transfers into the Reserve
Continuing Consulting Work or Studies 251,345
Transfers out of the Reserve (12,008)
Pre-Audit Actual Balance December 31, 2007 $ 713,821
1. Purpose of this Reserve:
This reserve was established to capture any unspent annual Current Budget
provisions related to consulting, continuing studies, professional and legal fees.
Under Generally Accepted Accounting Principles, the approval to expend funds
for these efforts ceases at year-end, however work may continue beyond that
date. The establishment of this fund enables the transfer of unspent funds into
future year and accommodates this frequent timing difference between the
approval and the expenditure.
The interest income on this account forms part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance levels of this Reserve:
There would be no recommended maintenance levels. Funds transferred to this
reserve will be used to fund the balance of the expenditures still to be incurred for
incomplete studies or consulting contracts.
Expenditures incurred in 2007 in the amount of $12,008 pertained to consulting
work that was transferred into the Reserve in the prior year. An additional
amount of $251 ,345 has been transferred-in for future work.
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APPENDIX B
RESERVE FOR VEHICLE REPLACEMENT - G/l 4624
Actual Balance December 31,2006
Transfers into the Reserve
$
72,547
50,000
Transfers out of the Reserve to Capital Fund
Pre-Audit Actual Balance December 31,2007
$
122,547
1. Purpose of this Reserve:
This reserve was newly established in 2004 to begin building up funds to finance
the cost of replacing the City's aging fleet.
The interest income on this account forms part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance levels of this Reserve:
There would be no recommended maintenance levels. Funds transferred to this
reserve will be committed to fund the purchase of new vehicles.
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APPENDIX B
RESERVE - PROVISION FOR EASTERN BRANCH LIBRARY - G/l 4626
Actual Balance December 31, 2006
Transfers into the Reserve
$
30,000
25,000
Transfers out of the Reserve
Pre-Audit Actual Balance December 31,2007
$
55,000
1. Purpose of this Reserve:
This reserve was newly established in 2005 to begin building up funds for a new
library at the eastern part of Pickering. This provision may be used to fund the
new facility, capital cost, resource materials and any other related costs.
The interest income on this account forms part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance levels of this Reserve:
There would be no recommended maintenance levels. In 2002, the Board of the
Library requested $10,000 under the Capital Budget for the "Provision for
Eastern Branch". A similar request was made in both 2005 and 2006 balance. It
is the intention of the Board of the Library to annually request for this provision to
continue building up funds for the proposed new facility. To reflect this intention,
effective 2006 Budget year, the provision has been done by a "Transfer to
Reserve for the Provision for Eastern Branch". In 2007, the annual provision has
been increased to $25,000.
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APPENDIX B
RESERVE - MOVE ONTARIO - G1l 4627
Actual Balance December 31, 2006
Contribution from Province of Ontario
$
833,243
Transfers out of the ReseNe
Capital Expenditures -Roads
(525,000)
Pre-Audit Actual Balance December 31,2007
$
308,243
1. Purpose of this Reserve:
This reseNe was newly established in 2006 to capture the one-time funding
received on March 20, 2006 from the Ontario government, the Ministry of
Transportation. The Ontario government is providing a one-time investment to
help municipalities primarily outside the GTA, with specific emphasis on rural and
northern municipalities and to invest in municipal roads and bridges.
Municipalities will determine their own roads and bridges priorities.
The interest income on this account forms part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance levels of this Reserve:
There would be no recommended maintenance levels.
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APPENDIX C
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RESERVE FUND FOR COMMUNITY FACILITIES - GlL 4225
Actual Balance December 31, 2006 $ 194,175
Transfers into the Reserve Fund
Interest Earned on External Investments 7,705 7,705
Transfers out of the Reserve Fund
Transfer to Capital Fund - Senior Centre (17,500)
Transfer to Capital Fund - Community Centre (3,500) (21,000)
Pre-Audit Actual Balance December 31,2007 $ 180,880
1. Purpose of this Reserve Fund:
This is a "discretionary" reserve fund established by Council to attempt to avoid
both tax rate fluctuations and the need for issuing long term debt for major
expenditures required for community facilities.
The interest income on this reserve fund forms part of the reserve fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance Levels of this Reserve Fund:
The balances in this fund have fluctuated from the high in 1998 of $773,483 to
the low in 2001 of $69,102. Other than interest income earned, there has been
no transfer to this reserve fund in the last six years.
Expenditures are transferred out of reserve funds only when incurred. The value
of the unspent budget commitments as at December 31, 2007 is $167,648.
Taking these commitments into consideration, the uncommitted balance of funds
available is $13,232. Additional amounts must be provided to this fund.
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APPENDIX C
RESERVE FUND FOR CAPITAL WORKS - G/L 4228
Actual Balance December 31,2006
Transfers into the Reserve Fund
Interest Earned on External Investments
$
321,618
13,868
Transfers out of the ReseNe Fund
Pre-Audit Actual Balance December 31,2007
$
335,486
1. Purpose of this Reserve Fund:
This Fund is a "discretionary" one and was established pursuant to section
417(1) (2) of the Municipal Act, 2001 for specified purposes by Council related to
the acquisition of assets.
The interest income on this reseNe fund forms part of the reseNe fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance Levels of this Reserve Fund:
Between the years of 1998 to 2000, the balances have been maintained at
$600,000 to $800,000. There has been no major contribution to this ReseNe
Fund in the past seven years. The value of the unspent budget commitments at
the end of 2007 is $13,822. Taking these unspent budget commitments into
account, the uncommitted balance available as at December 31, 2007 will be
reduced to $321,664. Major additional contributions will be required in future
years.
APPENDIX C i
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RESERVE FUND FOR DEVELOPMENT CHARGES - G/L 4229
Actual Balance December 31, 2006 $ 22,341,331
Transfers into tre Reserve Fund:
Net Developer Contributions $ 1,457,284
Interest Earred on External Investments 801,546
Interest Earred on I nternal Loans 179,538 2,438,368
Transfers out of the Reserve Fund:
Transfer Transit component to Region (10,200)
Transfer to Current Fum-DC Study (967)
Transfer to Capital Fund:
Fire-Additim & Renovations to Station 5 $ (294,266)
Parks (13,403)
Ext. Subdiv- Roads & Related (815,028)
Ext. Subdiv- Storm Water Management (115,700)
. Sidewalk-401 Pedestrian Bridge to GO Station (2,126) (1,240,523)
Pre-Audit Actual Balance December 31, 2007 $ 23,528,009
1. Purpose of this Reserve Fund:
This is an "obligatory" reserve fund and as such is governed by Municipal Act
2001, Development Charges Act, 1997, Ontario Regulation 82/98, City By-law or
agreement and requires revenue received for the special purposes to be
segregated from the general revenues of the municipality. Obligatory reserve
funds must be created whenever a statute requires revenue received for a
special purpose to be segregated from the general revenues of the municipality
and the revenue is to be used solely for the purpose prescribed by statute, i.e. in
this case the monies charged to developers must be held and used to fund
capital services and related background studies required for new growth.
The interest incomes on these funds form part of the reserve fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance levels of this Reserve Fund:
In accordance with development charge legislation, .ill! development charge
revenues must be held within separate Reserve Funds and can only be used for
the financing of growth-related projects. As such, no reserve fund limits are
appropriate for the Development Charge Reserve Funds because they are tied to
growth-related capital requirements.
This reserve fund has an unspent budget commitment of $3,664,631. The pre-
audit actual balance of $23,528,009 would be reduced by this amount to reflect
an uncommitted balance of funds available for future expenditures of
$19,863,378.
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APPENDIX C
RESERVE FUND FOR PARKLAND - G/L 4230
Actual Balance December 31, 2006
Transfers into the Reserve Fund:
Developers Contributions $
Interest Earned m External Investments
Interest Earned m Internal Loans
$
1,993,928
218,207
72,983
15,790
306,980
Transfers out of the Reserve Fund:
Transfer to Capital Fund-Parks:
Asphalt Replacement-Amberlea Park (basket crt)
Wata-frmt Trail-Park Crescent
Park Signage
Playground Reconstruction& Equipment
Playground Equipment Replacement
David Farr Park
Case Tractor
To-o W/2l'vbwers
Purchase of Property-Waterfront Trail
Pre-Audit Adual Balance December 31, 2007
1. Purpose of this Reserve Fund:
$
(15,560)
(34,814)
(960)
(93,454 )
(33,063)
(231,416)
(35,629)
(83,160)
(215,245)
(743,301 )
$ 1,557,007
This is an "obligatory" reserve fund and it was established pursuant to section
417(1 )(2) of the Municipal Act, 2001 as required by subsections 42(1), (5), (6),
(7), (8) and (9) of the Planning Act. This fund is governed by legislation,
regulation or agreement and requires revenues received for the special purposes
to be segregated from the general revenues of the municipality. Obligatory
reserve funds must be created whenever a statute requires revenues for a
special purpose to be segregated from the general revenues of the municipality
and the revenue is to be used solely for the purpose prescribed by statute.
The interest incomes on these funds form part of the res-erve fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance Levels of this Reserve Fund:
Due to the obligatory nature of this fund, there are no limits on this fund. The
value of the unspent budget commitment as at the year ended 2007 is $429,148.
The pre-audit balance of $1,557,607, after taking into account the unspent
budget commitments, will provide an uncommitted balance available of
$1,128,459 as at December 31,2007.
APPENDIX C
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RESERVE FUND FOR PUBLIC WORKS - G1L 4232
Actual Balance December 31, 2006
Transfers into the Reserve Fund
Third Party Contributions
Interest Eamed on Extemallnvestments
$ 1,072,893
$
3,444
46,370 49,814
Transfers out of the Reserve Fund
Pre-Audit Actual Balance December 31,2007
$ 1,122,707
1. Purpose of this Reserve Fund:
This fund was established by Council pursuant to section 417(1) (2) of the
Municipal Act, 2001. The purpose of the reserve fund is to acquire fixed assets,
to fund capital works related to public property, without the need to fund on a
long-term nature through the issue of debentures. The main purpose at this time
is to fund the City's share of the cost of subdivision works committed to under
various subdivision agreements.
The interest incomes on these funds form part of the reserve fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance Levels of this Reserve Fund:
The "average" annual balance of this fund over the last four years has been
approximately $1 million. This reserve fund should be kept at least at this level in
the future. Staff will periodically review the need for this level with the
requirements contained in the capital budget and four year program and report
any different findings to Council.
The value of unspent budget commitments for 2007 is $25,000. The pre-audit
balance of $1,122,707 would be reduced by this amount to reflect an
uncommitted balance of funds available of $1 ,097,707 as at December 31,2007.
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APPENDIX C
RESERVE FUND FOR VVCRKERS SAFETY I NSURJW;E BOARD - GIL 4234
Actual Balance December 31,2006 $ 834,922
Transfers into the REServe Furd
Cmtribution from Current Fund $ 423,349
Interest Eamoo m Extemallnvestments 43,633 466,982
Transfers out of the REServe Fund
Claims ard Oher Related Costs $ (63,005)
Insurance O:>sts (115,790)
Cmtribution to Health & Safety Training (20,000) (100,795)
Pre-Audit Actual Balance December 31, 2007 $ 1,103,109
1. Purpose of this Reserve Fund:
This reserve fund has been established to provide for the annual costs of
insurance coverage, contributions towards the health and safety program, and
the payment of claims and other related costs now that the City is a Schedule 2
employer. This reserve fund was created in 2001 further to the recommendation
passed in Council Resolution#127/01 and in compliance with Workplace Safety &
Insurance Act.
The interest incomes on these funds form part of the reserve fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance levels of this Reserve Fund:
Starting from 2004 and continuing to 2006, the contributions were more than
double the claims experience for the year, resulting to a built-up in the balance of
the reserve fund.
As Schedule 2 operates on the self-insured principle, any anticipated savings
between contributions and claims experience will be transferred to this Reserve
Fund to build up the fund balance in the event of any catastrophic claim-related
costs, which may occur. The average annual built-up of approximately $220,414
from 2003 to 2007 has resulted to the 2007 year-end balance of $1,103,109.
APPENDIX C
~..~ .:'-,)
THIRD PARTYIDEVELOPERS CONTRIBUTIONS RESERVE FUND - GIL 4235
Actual Balance December 31,2006
Transfers into the Reserve Fund
Contributions from Developer&'Third Parties
Interest Eamed on Extemallnvestments
$ 1,868,148
$ 205,408
81,324 286,732
Transfers out of the Reserve Fund
Capital Expenditures-Ext. Subdivision Works
Transfer to own Reserve Fund
Pre-Audit Actual Balance December 31, 2007
(24,696)
(963)
$ 2,129,221
1. Purpose of this Reserve Fund:
This reserve fund was established by Council pursuant to Section 417(1) of the
Municipal Act, 2001. The purpose of this reserve fund is to capture contributions
from developers or third parties per development agreements and any cost
sharing arrangements for future capital projects.
Due to the externally restricted contributions, this reserve fund is treated as
obligatory. The collections are committed for specific purposes and not available
for general use. Unless specified, the City is under no obligation to pay interest
to any developers or third parties.
The interest incomes on these funds form part of the Reserve Fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance Levels of this Reserve Fund
No reserve fund limits are appropriate for this fund as collection and commitment
of funds are dependent upon development agreements or cost sharing
arrangements.
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APPENDIX C
ONTARIO TRANSIT REtaVAL RESERVE FUND.. G'L 4236
Actual Balance Decerrber 31, 2>06 $ 19,100
Transfers into the Reserve Fund
Cmtribution from Mnistry of Transportation $
I nterest on External Investrrents-reversal
Transfers out of the Reserve Fund
QffiEKlut aocoLl1t-Reverue Fund (19,100)
Pre-Audit Actual Balance Decerrber 31, 2007 $
1. Purpose of this Reserve Fund:
This is an "obligatory" reserve fund established to capture funding received from
Ministry of Transportation for the sole purpose of funding acquisition of APTA
vehicles or for any major vehicle refurbishment.
The interest incomes on these funds form part of the Reserve Fund as per the
Municipal Act, 2001 section 417(3).
2. Recommended Maintenance Levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund as availability of funds is
dependent on the amount of grant received.
Funds are provided from the Ontario Transit Renewal Program as expenditures
are incurred. With the transfer of APTA to the Regional Municipality of Durham
effective January 1,2006, this Reserve Fund was officially closed-out in 2007
with the remaining funds recognized as revenue in the Revenue Fund.
Hi
APPENDIX C
SQUASH COlRTS RESERVE FUN::> - G1L 4237
Actual Balance Decerrber 31, 2006 $ 78,009
T ransfe-s into the Reserve Fun::!
Surchcrge on Merrberslips 35,549
I nterest on Exte-nal Investrrents 4,519 40,008
Transfe-s out of the Reserve Fund
Pre-Audit Actual Balance Decerrber 31, 2007 $ 119,057
1. Purpose of this Reserve Fund:
This reserve fund was established to capture funds from Pickering Squash
Club memberships' surcharges, corporate sponsorships, third party
contribution and any such funds as the Council may approve. This
Reserve Fund shall be used for the purpose of paying expenses related to
the provision of double squash courts. This Reserve Fund was newly
created in 2003 further to the recommendation passed in Council
Resolution #79/03, Item 5 per Report to Council CS 40-03.
The interest incomes on these funds form part of the reserve fund as per
the Municipal Act, 2001 section 417(3).
2. Recommended Maintenance levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund.
;-' ~~
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APPENDIX C
PROVINCIAL DEDICATED GAS TAX RESERVE FUND - G'L 4238
Actual Balance December 31, 2006
Transfers into the Reserve Fund
I nterest on External Investments
$ 771,076
33,236 33,236
Transfers out of the Reserve Fund
Cost-sharing APTA 2005'06
(281,298)
$ 523,014
Pre-Audit Actual Balance December 31, 2007
1. Purpose of this Reserve Fund:
This reserve fund was established to capture funds from the Province of
Ontario for the new provincial gas tax revenue program. This reserve fund
shall be used for the purpose of paying eligible public transportation
expenditures, to offset Pickering's share of the costs for funding the Ajax
Pickering Transit Authority (APT A). This reserve fund was created in 2004
further to the recommendation passed in Council Resolution #167/04, Item
3 at the Council Meeting of December 20, 2004 per Report to Council CS
56-04.
The interest incomes on these funds form part of the reserve fund as per
the Municipal Act, 2001 section 417(3).
2. Recommended Maintenance levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund. Under this program,
the provincial government will provide one cent a litre of the provincial gas
tax funding in 2004. This rate has been increased to 1.5 cents in 2005 and
increased to two cents in 2006.
As the purpose for providing this fund is for the public transportation
services, with the transfer of APT A to the Region effective January 1,
2006, the balance of this fund will be transferred to the Region once all
matters are resolved. At the time of writing (May 2008), Corporate
Services is preparing to transfer the remaining funds and interest earned
to-date to the Region.
~'. ..,
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APPENDIX C
FEDERAL DEDICATED GAS TAX RESERVE FLtJD - G'L 4239
Actual BaICllce December 31, 2006 $ 1,455,769
Transfers into tre Reserve Fund
Provo of O1tario 1,132,644
I nterest on Extemall nvestrrents 74,296 1,206,940
Transfers out of the Reserve Fund
Roads & MPE -Purchase of hybrid vehides (66,512)
Sidewak-401 Pedestrian Bridge-Design costs (13,109)
Sidewak installation-Valley Farm/Diefenbaker (50,000)
Storm Water fv1gmt-Toy Ave & Victoria St. (9,200)
Civic Cmpx-Upgrade to Ughting System (100,684)
Civic Cmpx-Humidification system, Air Handling Unit (15,655)
Dunbarton Pool-2 Levels of Roof Replacement (14,255)
Commurity Ctrs. -Fumace Replacement & Gym Top (28,075)
Recreation Canplex- Vapour Barrier (54,293)
Recreation Canplex-~Iine Hot Water Tanks (21,590)
Rec Canplex Arena-ComprESsor & Electrical Food (49,260) (518,633)
Pre-Audit Actual BaICllce December 31, 2007 $ 2,144,076
1. Purpose of this Reserve Fund:
This reserve fund was established in 2005 to capture the transfer of gas
tax revenues from the Government of Canada through the Association of
Municipalities of Ontario under the New Deal for Cities and Communities.
The Council had approved under Report to Council CS 92-05, the
establishment of this Reserve Fund under By-law 6609/05 and Resolution
219/05. This program is not application based and does not require
matching funding. Municipalities are allowed to invest in environmental
sustainable infrastructure in programs such as public transit, storm water
system, local roads and bridges.
The interest incomes on these funds form part of the reserve fund as per
the Municipal Act, 2001 section 417(1).
qi]
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2. Recommended Maintenance Levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund. Under the Municipal
Funding Agreement, the schedule of funding payments is as follows:
Year July November
2005 $ 849,577.58
2006 $424,788.79 424,788.79
2007 566,321.81 566,321.82
2008 707,854.83 707,854.84
2009 1,415,709.67 1,415,709.67
Total $7,078,927.80
~.............e;;~
')1
APPENDIX C
~UAL REPORT - WlLDlN3 PERMT FEES
fer the YEBr erdEd CBcanoor 31, 2007
Buildng Permit ReJerue
$ 933,519
Costs
Direct Costs
Indroct Costs
(1,142,117)
(201,244) (1,343,361)
$ (400,842)
Excessl(DEfldt) ReJfflue o\€r Ca;ts
BULDlNG PERMT STAB UZAll GJ ~E FLND -GL 4240
Q:Ering Balmce, Jm. 1, 2007
$
2007 Contribution
Oosing Balmce, ~. 31, 2007
$
1. Purpose of this Reserve Fund:
This reseNe fund was officially established in 2006 based on By-Law
6651/06 and Report to Executive Committee PO 41-05.
The need for the establishment of this reseNe fund arises as a result of
the significant changes to the building regulatory system in Ontario with
the introduction of the Building Code Statute Law Amendment Act, 2002
(known as Bill 124) and associated amendments to the Ontario Building
Code. The purpose of this fund is to secure funding to provide for seNice
delivery stabilization during an economic downturn. The source of funds
will be the annual portion of building code permit fees after related direct
and indirect costs are netted.
The interest incomes on these funds form part of the reseNe fund as per
the Municipal Act, 2001 section 417 (3).
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2. Recommended Maintenance Levels of this Reserve Fund:
Given the rationale for creating a fee stabilization reserve fund, the
targeted reserve fund balance should reflect the reduction in permits
witnessed during the last recession when compared to the long-run
development average - acknowledging the City's responsibility to manage
a portion of the costs associated with an economic downturn. Based on
the modeled activity based direct costs conducted by CN Watson; the
appropriate balance to maintain is proposed at $1.16 million, expected to
be achievable within a target of seven accumulated years.
As at the year ended 2007, this reserve fund remains at a zero balance.
This is due to the costs exceeded the building permit fee revenues;
therefore, there was no transfer to the Building Permit Stabilization
Reserve Fund.
The Building Code Act, section 7(4) requires an annual reporting of this
Reserve Fund, on which Report to Council CS 12-08, Executive Council
Meeting of March 17,2008 has provided the detailed information for the
2007 reporting year.
9<
APPENDIX C
ANIMAL SHELTER RESERVE FUND - G/L 4241 (New)
Actual Balance December 31,2006
Transfers into the Reserve Fund
Proceeds from PAW
Donations from "Dogs in the Park" event
Interest on External Investments
$
144,433
963
700 146,195
Transfers out of the Reserve Fund
Pre-Audit Actual Balance December 31, 2007
$ 146,195
1. Purpose of this Reserve Fund:
This reserve fund was established in 2007 under By-Law 6749/07, Report
to Council CS 16-07, Recommendation 9. This reserve fund was
established to record the City's share of the proceeds resulting from the
dissolution and disposition of the assets of Pickering, Ajax, Whitby Animal
Services (PAW). With the establishment of this reserve fund, financial
resources received and provided can be used to construct a permanent
animal shelter.
The interest incomes on these funds form part of the reserve fund as per
the Municipal Act, 2001 section 417(3).
2. Recommended Maintenance levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund. In addition to the
proceeds of $144,433 from PAW, $963 was received from donations
related to "Dogs in the Park" event held in 2006.
,) 4
APPENDIX C
PICKERING MEN'S SLOW PITCH RESERVE FUND - GIL 4242 (New)
Actual Balance December 31, 2006
Transfers into the ReseNe Fund
$
Transfers out of the ReseNe Fund
Pre-Audit Actual Balance December 31, 2007
$
1. Purpose of this Reserve Fund:
This reseNe fund was established at the end of 2007 under By-Law
6822/07, Report to Council CS 58-07. This reserve fund was established
to receive donations from the Pickering Men's Slow Pitch League, for
safekeeping of donated funds and further application of funds towards a
major softball facility. Report to Council OES 43-07 provides detailed
information on the memorandum of understanding between the City and
the Pickering Men's Slow Pitch League.
The interest incomes on these funds form part of the reserve fund as per
the Municipal Act, 2001 section 417(3).
2. Recommended Maintenance levels of this Reserve Fund:
No reserve fund limits are appropriate for this fund. As this reseNe fund
was established at the end of the year, there is no activity to report on.
The reporting of this reserve fund for the year ended 2007 is for
information only.