HomeMy WebLinkAbout2001 Budgets Information Pack#2
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2001
BUDGETS
INFORMATION
PACKAGE
#2
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City of Pickering
Table of Contents
2001 Budgets - Information Package #2
1.
Pa2:e #
1
Budget Meeting Minutes (May 14, 2001)
2.
Source of Application of Funds
(a) Financing of Capital- 1995-2001
4
(b) Summary of Budgetary Changes
5
3.
Arena Surcharge Reserve
6
4.
Reserves and Reserve Funds
. (a) Reports to Council, on "Pre-Audit Reserves and Reserve Funds
- Draft 2000 .
- 1999
- 1998
- 1997 .
7
22
35
49
(b) Extracts from annual Financial Statements and Financial Information Re.turn
as presented the Audit Committee and Council on Reserves and Reserve
Funds
- 1999
- 1998
- 1997
- 1996
62
64
66
68
(c) 1998 Budget Overview - Summary of Reserves and Reserve
Reserve Funds 1994 - 1997
70
(d) 2000' Strategic Advance Session - Reserves and Reserve
Funds 1995 - 2000
71
( e) 2001 Budget Overview - Reserves and Reserve
Funds 1990 - 2000
72
(f) Report to Council ftom the Treasurer dated November, 1999
- Development Charges Reserve Fund Statement
73
(g) Report to Council from the Treasurer dated April, 1998
- Management of Reserve and Reserve Funds
79
(h) Summary of Reserve and Reserve Funds 1995 - 2000
84
Current Operating Surpluses
(a) Draft 2000 Composition and Disposition of2000 Surplus
85
(b) Budget Committee Presentation on February 23,2000
- 1999 A Good News Year - Composition and Disposition
of 1999 Surplus
86
BUDGET MEETING
MAY 14th
4:00 P.M.
MINUTE S
A meeting of the Committee of the Whole of the Council of The Corporation of the City
of Pickering was held on May 14th, 2001 at 4:00 p.m. in the Main Committee Room to
consider additional information provided by staff respecting the Proposed 2001 Budget as
requested by Council at the May 3rd meeting. .
PRESENT:
Mayor Arthurs
Councillor Brenner
Councillor Holland
Councillor Johnson
Councillor McLean
Councillor Pickles
Councillor Ryan
Staff:
(
T. J. Quinn
G. Paterson
N. Carroll
E. Buntsma
S. Karwowski
A. Greentree
- Chief Administrative Officer
- Director, Corporate Services & Treasurer
- Director, Planning & Development
- Director, Operations and Emergency Services
- Manager, Finance & Taxation
- Supervisor, Legislative Services
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Councillor Ryan stated that some confusion still remains with the IS and the Corporate
Efficiency Initiatives budgets. Councillor Ryan advised that he and Councillor Holland
will meet with the Manager, Information Systems to discuss these budgets and stated that
he would advise members of' Council of any significant issues/items for their
consideration prior to the May 22nd Council Meeting. The CAO advised he would also
like to attend the proposed meeting.
2613 DEVELOPMENT CONTROL
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Moved by Councillor Pickles that Account 6181 (Other Fixed Assets) be increased by
$3500 to provide for the construction of a black vinyl chain link fence on the east side of
Altona Road, adjacent to the "bulb" turning circle of Granby Court.
CARRlED
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2712
PROGRAMS
Moved by Councillor Pickles that Account 2394 (Receptions, Promotions & Special
Events) be reduced to $10,000 to eliminate the Canada Day City Council Tent and
provide for only one additional stage to be used for a variety of events.
LOST
2127 FINANCE
GENERAL GOVERNMENT
Moved by Councillor Brenner that Account 1560 (penalties & Interest on Taxes
Revenues) be inCreased by $300,000 to more accurately reflect estimated revenues based
on Account history and 2001 Actuals, to date.
LOST
Moved by Councillor Pickles that Account 1560 (penalties & Interest on Taxes
Revenues) be increased by $175,000 to provide a more accurate yet conservative estimate,
. of revenues based on Account history, most specifically 1999 Actuals.
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CARRIED
Moved by Councillor Holland that the Budget Adjustment of$175,000 be applied and a
corresponding amount in OMERS savings be reduced.
WITHDRAWN
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Moved by Councillor Holland that $175,000 be applied against internal debt financing,
and other budget adjustments be applied against internal debt financing, thus maintaining
a 9.8% budget increase over the 2000 Budget.
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CARRIED
2715 DON BEER ARENA
Moved by Councillor Johnson that the $108,000 recently received from Confederation
Life, which is currently in the General Revenues Account, be transfeiTed to 2715-6181
(Other Fixed Assets) to be applied to line item 01-2715-005-01 the Construction of a
third ice pad at Don Beer Arena.
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LOST
In addition to the comments and supporting documentation provided, Council also
requested the following:
1.
Staff are to consider incorporating Consumer Price Index (CPI) into future
budgets and are to report back to Council by September with their
reconnnendations. '
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2.
Council briefly discussed the Arena Surcharge Reserve and requested staff to
provide back-up documentation for both 1999 and 2000 Annual Contribution
amounts.
3.
Staff are to provide all Reserve Account balances.
4.
As there are legislative requirements respecting reserve funds, Council
requested details of the reserve collections including amounts collected, when
and for what purpose, and amounts spent, when and for what purpose.
Moved by Councillor Holland that the 2001 Budget, as amended, be referred to Council
for the May 24th meeting at 7:30 p.m. '
CARRIED
The, meeting adjourned at 6:25 p.m.
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. CITy'OFPJCKëRING
2001
, " ,
Financing ofCàÞital"1995to 2001
Capital Capital Capital Capital
Budget Budget Budget Budget
1!l95 111!!§ .ll!IU. 111!!§
Capital from Current $2,068,054 $3,142,739 $2,836,568 $1,698,498
Reserves & Res Funds 5,237,911 4,101,068 3,302,719 1,926,100
Provo & Fed. Grants 831.708 556,729 1,456,740 1.236,949
~ I Millennium Trail Cont.
Debt & Lease a a a 2.fi28.!!93
Total $8137673 $7800 536 $7 596 027 17490 440
Debt Charges
Munl¡;lpal Debtts really deferred taxation.
Excludes donations and developer contributions.
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Capital
Budget
1Iia9
$1,609,533
4,343,624
51,350
1,400,000
2..3Oli83.
$9.707.990
276,100
Proposed
Capital Capital
Budget Budget
2QOO 2QO1
$1,256,595 $1,679,220
4,340,352 3,361,815
3...180.188
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613,697
1,181,271
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May 3, 2001 Budgetary Increase
Decrease
Budgetary Budgetary Percentage In
Change ~ Change Res Fund
24,194,816 9.80%
(5,000) 24,189,816 9.78%
Increase
(Decrease)
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2
Reduction to North.East Quadrant
Study (Net Reduction is $5.000)
Increase in budget to reflect
City's contribution for signalization
at Kingston Rd & Bainbridge
25,000
24,214,816
9.89%
4
Additional funding for parking lot
expansion at Vaughan Willard
School. This project is funded
by Parkland Reserve Fund
10,000
10,000
Additional funding for moraillty
lighting is funded from Parkland
Reserve Fund.
20,000
20,000
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Additional funding for playground
equipment at Centennial Park
funded from Parkland Reserve Fund,
45,000
45,000
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Additional funding for Storm Water
Rehablliatlon of $15,000 will be funded
through debt
15,000
15,000
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Deletion of HVAC system at
community centre.
(50,000)
24,164,816
9.66%
Phase one funding for the third ice
pad through the Arena Surcharge
Reserve.
215,000
215,000
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Increase in POA Revenues
(205,000)
23,959,816
8,73%
11
Increase in OMERS savings to be
used to reduce the amount of debt
(125,000)
(125,000)
12 May 14, 2001 Budgetary Increase 23,959,816
13 Increase in capital budget to reflect
construction of a fence around Granby Crt. 3,500 23,963,316
14 Increase in Tax Penalty Revenues (175,000) 23,963,316
16 Reduction in Debt funded through
an increase in capital from current levy,
peA Revenues 24,168,316
Mis. Transcations 24,194,816
8,73%
8,75%
8,75%
(175,000)
9.80%
(205,000)
(26,500)
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RESERVE FOR REPLACEMENT OF CAPITAL EQUIPMENT
USER FEE SURCHARGE
Dec, 31. 2000
SPECIFIC DEPT. PROVISIONS
Recreation
Dunbarton Indoor Pool
Rae, Complex - Pool
Sub-Total
Rec, Complex- Core
Sub-Total
TOTAL RECREATION
RES4611
jAAit¡:¡¡~:~~~~M¥
In
4,962,00
8,156,00
13,118,00
12,500,00
11,000,00
23,500.00
17,277,00
17,277.00
$~;¡¡ij$iøo
}ì~~tJ.(¥)~,~~ij'~M
In
4,962,00
8,156,00
1~t118,oo
25,000,00
23,000,00
48,000.00
17,277.00
____17,277.00
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CITY OF PICKfRil'ÍG
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- 4,962,00
15,000,00
19,962,00
30,000.00
30,000,00
60,000,00
25,000,00
25,000,00
::jòji~~~iQá:"
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4,962,00
15,000,00
19,962,00
30,000.00
30,000,00
60,000.00
25,000,00
25,000.00
."'1M;¡:¡~;ijó:.:
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4,962,00
15,000.00
19,962,00
30,000,00
30,000,00
60,000,00
25,000,00
25,000,00
:1ø4;9$~;ÖØ.
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REPORT TO COUNCIL
DRAFT
FROM:
Gillis A. Paterson
Director, Corporate Services & Treasurer
DATE: May 16, 2001
REPORT NUMBER: CS 13-01
SUBJECT:
2000 Pre-Audit Balances of Reserves and Reserve Funds
RECOMMENDATION:
It is recommended that Report CS 13-01 of the Director, Corproate Services & Treasurer be
received by Council for information. '
ORIGJN:
Report submitted annually to Council.
AUTHORITY:
Municipal Act, R,S,O. 1990, as amended, Section repealed and 163.
Ontario Regulation 438/97
FJNANCIAL IMPUCATIONS:
Not applicable.
EXECUTNE SUMMARY:
As in previous reports filed over the last three years, this report provides specific information on
each of the City's reserves and reserve funds, inc1~ding year end bálances, Compared to prior
years the current year end balances have declined due to tight budgetary restrictions to keep tax
increases to zero. At the same time the need for debt financing has been lessened,
BACKGROUND:
Based on the preliminary 2000 results, we can now report on the pre-audit actual activities within
the reserves and reserve funds for 2000, Caution must be exercised in using this information, as
the City Auditors have not yet finished their annual review,
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The "purpose" and the "recommended maintenance level" for each reserve and reserve fund are
set out in Appendices B and C respectively,
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Report to Council CS 13-01
Date: May 16, 2001
Subject: 2000 Pre-Audit Balances of Reserves and Reserve Funds
Page 2
It is anticipated that a report will be filed with Council later this year rationalizing the different
funds, balances and including a review of any underlying by-laws.
ATTACH1vŒNTS:
1.
2,
3.
Appendix A Summary of Reserve and Reserve Funds
Appendix B Description of Reserves
Appendix C Description of Reserve Funds
Prepared By.
Approved / Endorsed By.
Caryn Kong,
Senior Financial Analyst
Gillis A. Paterson,
Director, Corporate Services & Treasurer
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Attachments
Recommended for the consideration of Pickering
City Council
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Thomas J, Quinn, Chief Administrative Officer
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APPENDIX A
SUMMARY
CITY OF PICKERING
SUMMARY OF RESERVE AND RESERVE FUND PRE-AUDIT ACTUALS
DECEMBER 31,2000
Pre Audit Actuals
Appendix B Summary of Reserves 2000 1999 1998 1997
4610/4617 WorkÏng FundsN acation Pay 841,350 841,350 841,350 841,350
4611 Replacement of Capital 2,153,816 2,521,806 1,829,610 175,914
Equipment
4612 Contingencies 1,371,295 1,381,295 786,318 264,319
4613/4614 Self Insurance/Inventories 776,410 713,080 579,124 452,207
4618 Reskilling 83,900
4619 Rate Stablilization 249,139 2,981,232 1,786,232
4620 Dev, Charges - City's portion 1.889.000
7,281.010 8.438.764 5.822.634 1.817.690
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Funds
4225 Community Facilities 282,569 219,209 773,483 447,280
4227/4229 Development Charges 7,586,550 6,744,603 5,874,293 6,145,652
4228 Capital Works 850,630 826,082 613,464 403,758
4230 Parkland 3,875,813 4,242,340 5,778,228 4,161,322
4232 Public Works 1,304,410 1,194,655 1,185,154 1,096,536
4233 Pickering Baseball Assoc. 60.789
13.960,761 13.226.889 14.224.622 $12,254,548
Total Reserve and Reserve Funds $21.241.771 $21.665.652 $20.047256 $14.072.238
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APPENDIX B
RESERVE FOR WORKING FUNDSN ACATION PAY G/L 4610/4617
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
Working Funds
Vacation Pay
$841,350
0
0
Transfers out of the Reserve
0
Pre-Audit Actual Balance December 31, 2000
Working Funds
Vacation Pay
$400,000
441.350
$841 350
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1.
Purpose of the Reserves:
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The reserve for working funds is used to provide operating cash to assist in avoiding short
term interest expenses incun-ed on operations, typically during the first months of the year
prior to tax billing and at other times when cash inflows and outflows are out of balance
as occurs in any corporation,
The reserve for vacation pav has been established to ensure that the cost of vacation pay
eamed, but not taken, is correctly allocated to the taxpayers of that year and the Council
of that period.
The interest income on these funds form part of the annual Current Budget General
Government Revenue.
2.
Recommended Maintenance Levels of the Reserves:
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Reserve for Working Funds- It is recommended as a "rule-of-thumb" that this reserve be
up to 2% - 3% of total revenues,
Reserve for Vacation Pav - This reserve should be equal to the vacation pay eamed, but
not taken in any given year, Any difference would be taken into consideration in the next
year's budget.
3.
Comment:
The Vacation Pay Reserve is no longer needed as such and it is recommended that it be
collapsed and roled in the Working Capital Reserve, No additional contributons to this
reserve are anticipated at this time, A report will be forthcoming later this year and this
reserve will be recommended to be transferred to Working Funds to provide a more
appropriate balance in that Reserve,
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APPENDIX B (page 2)
RESERVE FOR REPLACEMENT OF CAPITAL EQUIPMENT G/L 4611
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
2000 Budget
Various Recreation Revenues,
$ 2,521,806
104.962
104.962
Sub-total
$2,626,768
Transfers out of the Reserve
2000 Contribution to Capital Fund
Finance, Roads, & Transit
(472.952)
Pre-Audit Actual Balance - December 31, 2000
$2153816
1.
Purpose ofthis Reserve:'
The purpose of this reserve is to eliniinate 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 mill rate fluctuations and the issuance of long term debt or other means of
,:financing,
The interest income on these funds fonn part of the annual Current Budget General
Government Revenue.
2.
Recommended Maintenance Levels of this Reserve:
This reserve should be kept at a level which is equivalent to the replacement cost of the
assets for which they were established. The reserve has fluctuated from the low as at
December 31, 1997 of $175,914 to a high of $2.52 million at the end of 1999 No
additional provision has been provided for in the current budget for several years and this
account continues to be underfunded. Major additional contributions will be required in
future years.
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APPENDIX B (page 3)
RESERVE FOR CONTINGENCIES G/L 4612
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
2000 Budget
- General Government - Assessment Appeals
$1,381,295
150,000
Sub-total
150,000
1,531,295
Transfers out of the Reserve
2000 Cant to General Ftmd
- Western Branch Books
- Election Provision
(50,000)
010.000)
060.000)
Pre-Audit Actual Balance - December 31, 2000
$1371.295
1.
PUI'Dose 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 these funds form part of the annual Cun-ent Budget General
Government Revenue,
2.
Recommended Maintenance Levels of this Reserve:
Staff continue to monitor the balance of this reserve and the need for long term
contributions required,
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APPENDIX B (page 4)
RESERVE FOR SELF INSURANCE/INVENTORY GIL 4613/4614
Actual Balance December 31,1999
2000 Transactions
Transfers into the Reserve
- Inventory Adjustment
- Insurance Premiums Under Budget Provisions
$ 713,080
0
63.330
63.330
776,410
0
" Transfers out of the Reserve
Pre-A,.udit Actual Balance - December 31, 2000
$776.410
(Transfers based on actuals at year end)
1.
Purpose of this Reserves:
Reserve for self-insurance
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, The higher
deductible reduced insurance premiums. Significant savings can be realized through
reduced premium costs and staff analyze the costslbenefits of such actions on an annual
basis.
Reserve for Inventorv
This reserve has been established to ensure that the cost of revolving inventories is
correctly allocated to the taxpayers of that year and the Council of that period.
The interest income on these funds form part of the annual Current Budget General
Government Revenue.
2.
Recommended Maintenance Levels of this Reserve:
Resèrve for self insurance
This reserve should be maintained at a level to ensure that the funding is adequate to meet
actuarial liabilities, This situation is analyzed by staff on a regular basis,
Reserve for Inventory
The maintenance level required is explained in the description of the purpose for this
reserve,
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APPENDIX B (page 5)
RESERVE FOR RATE STABILIZATION G/L 4619
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
$2,981,233
0
Transfers out of the Reserve to Current Budget
(2.732,094)
Pre-Audit Actual Balance- December 31, 2000
$249.139
1. Purpose of this Reserve:
The purpose of this reserve is to act as a mill rate stabilization factor for annual current,
budget funding.
The interest income on these funds form part of the annual Current Budget General
Government Revenue.
2. Recommended Maintenance Levels of this Reserve:
The level of this reserve wìIl continue to be monitored.
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APPENDIX B (page 6)
RESERVE FOR DEVELOPMENT CHARGES - CITY SHARE GIL 4620
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
- 2OOO,Provision
- Surplus
$
0
400,000
1,489,000
Transfers out of the Reserve
0
Pre-Audit Actual Balance - December 31, 2000
$1.889.000
1. Purpose of this Reserve:
This reserve has been established to set aside funds for projected growth in the City, From
the 1999 Development Charges Study it was approved that a Reserve Fund be established for
the City's share i.e. the nondevelopment charge portion, of the costs of services included in
the Development Charges study and that contributi<;ms 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 income on these funds form part of the annual Current Budget General
Government Revenue,
2. Recommended Maintenance Levels of this Reserve:
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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 C
RESERVE FUND FOR COMMUNITY FACILITIES GIL 4225
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
Interest Earned
Contribution from Capital Fund
$ 219,209
9,021
54.339
282,569
Transfers out of the Reserve
0
Pre-Audit Actual Balance - December 31, 2000
$~
1.
'Purpose of this Reserve:
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,
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The interest income on these funds form part of the Reserve Fund as per the Municipal
Act.
2.
Recommended Maintenance Levels of this Reserve:
The balances of this fund have fluctuated from the 1999 year low of$219 thousand to the
high in 1994 of $5.1 million, Additional amounts must be allocated to this fund,
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APPENDIX C (page 2)
RESERVE FUND FOR DEVELOPMENT CHARGES G/L 4227/4229
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
Capital Fund Contribution
Interest Earned
Net Developer Contributions
$6,744,603
4,638
366,765
2.309.371
9,425,377
Transfer to Capital Fund
2127 -Finance
2240 - Fire
2321-Roads - External Subdivision
2321-Roads- Vehicle
2360 - Specialized Transit
2718 -Parks - Development
2745 - Libraries - Materials
2745 - Libraries - Fixed Assets
2610 -Planning- Studies
$ (40,000)
(400,000)
(617,412)
(14,000)
(64,800)
(143,000)
(88,000)
(468,000)
(3.615)
(1,838,827)
Pre-Audit Actual Balance - December 31, 2000
$7.586.550
1.
Purpose of this Reserve:
This is a "obligatory" reserve fund and as such is governed by Provincial Legislation and
Regulation. 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 in trust and used to fund capital services required for
new growth,
The interest income on these funds form part of the Reserve Fund as per the Municipal
Act.
2.
Recommended Maintenance Levels of this Reserve:
In accordance with development charge legislation, all development charge revenue 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 development charge
reserve funds because they are tied to growth-related capital requirements.
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APPENDIX C (page 3)
RESERVE FUND FOR CAPITAL WORKS G/L 4228
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
Interest Earned
Developer Contributions (refund)
$826,082
$33,798
(9.250)
24.548
Transfers out of the Reserve
0
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Pre-Audit Actual Balance - December 31, 2000
$~
1.
Purpose of this Reserve:
This Fund is a "discretionary" one and is established pursuant to subsection 163.(2) of the
Municipal Act for specified purposes by CO1.IDcil related to the acquisition of assets,
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The interest income on these funds form part of the Reserve Fund as per the Municipal
Act.
2.
Recommended Maintenance Levels of this Reserve Fund:
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This reserve fund has its lowest balance at the end of 1997 of $404 thousand, with the
highest balance in the last 4 years being $1.495 million at the end of 1995. The level of
this reserve will continue to be monitored.
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APPENDIX C (page 4)
RESERVE FUND FOR PARKLAND G/L 4230
Actual ,Balance December 31; 1999
2000 Transactions
Transfers into the Reserve
Interest Earned
Recreational Land (cash-in-lieu)
Capital Fund Contribution
$4,242,339
188,724 '
114,400
6.563
4,552,026
Transfers out of the Reserve
Transfer to Capital Fund
2132 -Town Property - Trackless Tractor
2718 -Parks - Land Purchase 927 Tullo St,
- Ford Packer/Compactor
- Farm Tractor
- Playground Equipment & Misc
Park Development
$(69,577)
(118,750)
(23,011)
(7,875)
(457.000)
(676.213)
Pre-Audit Actual Balance - December 31, 2000
$3.875.813
1.
Puruose of this Reserve Fund:
This is an "obligatory" reserve fund and it has been established pursuant to subsection
163.(2) of the Municipal Act 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 pmposes 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 income on these funds form part of the Reserve Fund as per the Municipal
Act.
2.
Recommended Maintenance Levels of this Reserve Fund:
Due to the obligatory nature of this fund, there are no limits on this fund,
19
APPENDIX C (Page 5)
RESERVE FUND FOR PUBLIC WORKS G/L 4232
Actual Balance December 31; 1999
2000 Transactions
Transfers into the Reserve
Interest Earned
Developer Contributions - (Refund)
Capital Fund Contribution
$1,194,655
48,819
(683)
70.119
$1,312,910
Transfers out of the Reserve
Transfer to Capital Fund
2321 - External Subdivision Works - Rosebank
/Strouds Lane
(8.500)
Pre-Audit Actual Balance - December 31, 2000
$1.304.410
1.
Purpose of this Reserve Fund:
This fund has been established by Council pursuant to subsection 163,(2) of the
Municipal Act. The purpose of the reserve funds is to acquire fixed assets, e,g, storm
sewers, 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
commited to under various subdivision agreements.
The interest income on these funds form part of the Reserve Fund as per the Municipal
Act.
2.
Recommended Maintenance Levels of this Reserve Fund:
The "average" annual balance of this fund over the last four years has been approximately
$1.25 million, This reserve 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
budgets and four year program and report any different findings to Council.
I
I
"
20
APPENDIX C (Page 6)
RESERVE FUND FOR PICKERING BASEBALL ASSOCIA nON
GIL 4233
Actual Balance December 31, 1999
2000 Transactions
Transfers into the Reserve
Interest Earned
Pickering Baseball Association
$ 0
789
60,000
60,789
---.Q
Transfers out of the Reserve
Pre-Audit Actual Balance - December 31, 2000
~
1. Purpose of this Reserve Fund:
This Reserve Fund has been established for the construction of the Brockridge Park
Clubhouse, The funding for this Reserve Fund shall initially be by contribution ttom the
Pickering Baseball AssociatoD, and thereafter ITom any other donors or contributors or
ttom such funds as the Council of the City of Pickering may ttom timeto time approve,
The interest income on these funds form part of the Reserve Fund as per the Municipal
Act.
2.
Recommended Maintenance Levels of this Reserve Fund:
Due to the obligatory nature of this fund, there are no limits on this fund.
21
~ OF PIO .
v' 't~
Ii! 5t~.,. "
¡... ~~ G)
-
".
".'
REPORT TO COUNCIL
FROM:
Gillis A Paterson'
Director, Corporate Services & Treasurer
DATE: April 17, 2000
REPORT NUMBER: CS 06-00
SUBJECT:
1999 Pre-Audit Balances of Reserves and Reserve Funds
RECOMMENDATION:
It is recommended that Report CS 06-00 of the Director, Corproate Services & Treasurer be
received by Council for information. '
ORIGThT:
Report submitted annually to Council, ,
AUTHORITY: '
Municipal Act, RS.O. 1990, as amended, Section repealed and 163.
Ontario Regulation 438/97
¡-
FJNANCIAL IIv:1PLICATIONS:
Not applicable.
I' ,
, - ,- --------,- -,------- -'-'-.-'-,-_._---, -- -----'---'------',.._-,-------'---,,----,---,-----,-_._-- -'--'--"-' --, "-,'--'-- ---" -----,_..,
EXECUTIVE SUMMARY:
I
I,
This report provides speciñc info:rmation on each of the Town's reserves and reserve ,funds,
including year end balances, Compared to prior years the current year end balances present a
favourable trend of increase rather than decline. The Finance Department will endeavour to
continue this direction to improve the overall financial position of the Town,
BACKGROUND:
Based on the preliminary 1999 results, we can now report on the pre-audit actual activities within
the reserves and reserve funds for 1999, Caution must be exercised in using this information, as
the Town Auditors have not yet finished their annual review.
The "purpose" and the "recommended maintenance level" for each reserve and reserve fund are
set out in AppendicesB and C respectively-
:22
,.
,
"
" "
Report to Council CS 06-00
Date: April 17, 2000
Subject: 1999 Pre-Audit Bahmces of~eserves and Reserve Funds
Page 2
ATTACHMENTS:
1.
2.
3.
Appendix A SUID.ID.aIy of Reserve and Reserve Funds
Appendix B Description of Reserves
Appendix C Description of Reserve FUnds
Prepared By:
Approved! Endorsed By:
~~
, g Jim Tomlinson,
r { Deputy Treasurer
'~~
. Gillis A Paterson, ,~
'Director, CoIporate Services & Treasurer
GP:vw
Attachments
I,
¡
Recommended for the consideration of Pickering
City Council
Thomas J.
Chief Administrative Officer .
1,,------------- --...---- ..----- -, -.. --,--'. .-.---- '--'_..""."---------- '--'._""-"'_..'-'--_.'--_..--...,.,"'----,....---':"_..,....,,-,,_.. -, ..'.---..--------.-------
}
23
,
i '
ATTACHMENT#--L TO REPORT#..Œ.:fì"-O,
APPENDIX A
S UM:MAR. Y
TOWN OF PICKERING
SUMMARY OF RESERVE AND RESERVE FUND PRE-AUDIT ACTUALS
DECEMBER 31, 1999
Pre-Audit Actuals Actuals
AppendixB Summary of Reserves 1999 1998 1997 1996
4610/4617 Working FtmdsNacation Pay $ 841,350 $ 841,350 $ 841,350 $ 841,350
4611 Replacement of Capital 2,521,806 1,829,6.10 175,914 1,453,125
Equipment,
4612 Contingencies 1,381,295 786,319 264,319 194,440
4613/4614 Self InsurancelInverrtori es 713,080' 579,123 452,207 458,954
4618 Reskilliñg, 0 0 83,900 83,900
4619 Rate Stabli1ization 2.981.233 ' 1.973,817 0 0
$8.438.764 $6.010.219 $1.817.690 $3.031.769
\
¡ --- ---;, _..,.. ""'-'-'"" -...-.--..-..-..'..--------------'...,..--,-,.-"-.-,,..-----,-.--'-.."-"..-------,--.--..--.-..--.--..-....,---.-..,---..,...._,-.._.-..-..,_._-_.., .-
Appendix C Summary of Reserve 1999 1998 1997 1996
~
4225 Community Facilities $ 219,209 $ 773,483 $, 447,280 $ 1,404,317
4227/4229 ,Development Charges 6,744,603 5,874,293 6,145,652 5,016,146
4228 Capital Warks 826,082 613,464 403,758 1,342,783
4230 Parkland' 4,242,340 5,778,228 4,161,322 4,690,984
4232 Public Works 1.194.655 1.185.153 1.096.536 1.183,448
13.226.889 14.224.621 $12.254.548 $13.637.678
Total Reserve and Reserve Funds $21.665.653 $20.234.R40 S14.072.23R $16 ti69.447
24
A1TACHMENT # ~ TO REPORT # ~ (;(.,---00
APPENDIX B
RESERVE FOR WORKrNG FUNDSN ACATION PAY G/L 4610/4617
;
)'
Actual Balance December 31, 1998
1999Transactions
Transfers into the Reserve
Working Funds
Vacation Pay
$841,350
0
0
Transfers out'ofthe Reserve
0
Pre-Audit Actual Balance December 31, 1999
WorkingFtmds '
Vacation Pay
$400,000
441.350
$~
¡
I
!
1.
Puruose of the Reserves:'
The reserve for working funds is used to provide operating cash to assist in avoiding short
term interest expenses incurred on operations during the first months of the year prior to
tax billing.
The reserve for vacation pay has been established to ensure that the cost of vacation pay
earned, but not taken, is couectly allocated to the taxpayers of that year and the Council
of that period.
2.
Recommended Maintenance Levels of the Reserves:
Reserve for Working Funds - It is recommended asa "rule-of-thumb" that this reserve not.
í exceed 1 % of total revenues, The present balance approxnnates that amount.
I ,-, - -- '.. --..' .- -,,-. "-.-'.----"-.,--.--.,-,-..".-,.-,,-,.,--.,.-.--,..------------.--,...-..---,..,.-,-.--"--.---.-,,,-., -_..".-,'._-_.- .,._- - ,-_.., "._,
Reserve for Vacation Pay - This reserve should be equal to the vacation pay earned., but
not taken in any given year. Any difference would be taken into consideration in the next
year's budget, .
.;.
9:~
;,,~
'. '
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)
!
j
!
r
APPENDIX B (page 2)
RESERVE FOR REPLACEMENT OF CAPITAL EQUIPMENT GIL 4611
Actual Balance December 31, 1998
1999 Transactions
Transfers into the Reserve
, 1999 Budget,
General Government Provisions
Various Recreation Revenues
$ 1,829,610
$1,141,000
104.962
1.245.962
Sub.total
$3,075,572
Transfers out of the Reserve
1999 Cont to General Fund
- Provincial Trarisit Capital Assistance
(553.766)
Pre-Audit ActuaIBalance - December 31, 1999
$2.521 806
1.
Pm'vose of this Reserve:
The purpose of this reserve is to eliminate 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 mill rate fluct1latÌons and the issuance of long term debt or other means of
financing.
2.
Recommended Maintenance Levels of this Reserve:
This reserve should be kept at a level which is equivalent to the replacement cost of the
assets for which they were established. The reserve has fluctuated from the low as at
December 3'1, 1997 of $175,914 to a high of $2.52 million at the end of 1999 No
- , .-, ,..,,' - ,--additional--provisi{)n,-has.-been-provided-fÐr--m-the--ßU1'T:ent-budget-but-.,this,-account-. - ... '..
continues to be underfunded. Maj or additiønal contributions will be required in future
years.
,. -....-,.-,-.,.
/26
APPENDIX B (Page 3)
RESERVE FOR CONTINGENCIES GIL 4612
Actual Balance December 31, 1998
1999 Transactions
Transfers into the Reserve
1999 Budget
- General Government
Sub-total
- Election Provision
- Assessment Appeals
- WcstemBranchBooks
- Stann Damage Grant
Transfers out of the Reserve
1999 Cont to General Fund
- Assessment Appeals
Pre-Audit Actual Balance - December 31, 1999
1.
Purpose of this Reserve:
55,000
321,386
50,000
311.167
$786,319
737.553
1,523,872
(142,577)
$1.3&1 295
Like the capital equipment replacement reserve, this reserve acts in a tax stabilization
capacity. It was established :in anticipation of unknown, lIDusua1 or extraordinary
expenditures which occUr from time to time. .
2.
Recommended Maintenance Levels of this Reserve:
I.....,_e-_..,..
¡
I
Staff continue to moIÙtor the balance of this reserve and the need for long tenD
contributions required..
.. , .. - ..---,- --'-"-"""'-"""-"'.'-"""'._".'--"'.._- ._-,- _"d".,___, -,_..,,----, -" .., ,",.- ., .". ,.._" ."" ..." .-...- .d_"',. - ..", -. _. .,...- .-..,- -
.21
"-". --,-
APPENDIX B (page 4)
, RESERVE FOR SELF INSURANCEIINVENTORY G/L 4613/4614
Actual Balance December 31, 1998
1999 Transactions
Transfers into the Reserve
- Inventory Adjustment
- Jns1JIance Premiums Under Budget Provisions
$ 579,12~
42,294
91.663
133.957
713,080
Transfers Ollt of !Àe Reserve - Inventory Adjustment
0
Pre-Audit Actual Balance - December 31, 1999
$mMIl
(T=fers based on actuals at ycàr end)
1.
Purpose of this Reserves:
Reserve for self-insurance
This reserve was established as a foDD. of asset protection. Specmcally, it is to cover
insurance claims resulting from the increase in deductible levels to reduce insurance
premiums. Significant savings can be realized through reduced premium costs and staff
analyze the costs/benefits of such actions on an annual basis.
Reserve for Inventorv
This reserve has been established to ensure that the cost of revolving inventories is
correctly allocated to the taxpayers of that year and the Council of that period.
".,. "'.'2;"'-- .-.RecoDlID'ended"Ma:intenance-J:;evels.of-this'Reserve:.'-""-- --"-"'.""". .-,--.." -- -,-,'... ......,., ,_..,.. - .., .,. ,... .,
Reserve for self insurance
This reserve should be maintained at a level t1J ensure that the funding is adequate to meet
actuarial liabilities. This situation is anaiyzed by staff on a regular basis.
Reserve for Inventorv
The maintenance level required is explained in the Description of the puzpose for this
reserve.
,2)$
APPENDIX B (page 5)
RESERVE FOR RATE STABILIZATION G/L 4619
Actual Balance December 31, 1998
1999 Transactions
Transfers into the Reserve
- 1999 Provision
$1,786,233
1,195,000
Transfers out of the Reserve
0
Pre-Audit Actual Balance - December 31, 1999
$2.9R1 233
1. Puroose of this Reserve:
The purpose of this reserve is to, act as a mill rate stabilization factor for annual current
budget funding,
2. Recommended Maintenance Levels of this Reserve:
The level of this reserve will continue to be monitored.
).., --P..,-"",
- - --, ..",.. ,- .
"" - -, '-, -,
.. - ", -,.,
I
.'
29
, '" ..,. ", .- ,
. .. .
A1TACHMENT#--Ì. TO REPORT#.£S: Or;--OO
APPENDIX C
RESERVE FUND FOR COMMUNITY FACILITIES G/L 4225
Actual Balance December 31, 1998
1999 Transactions
Transfers into the Reserve
Interest Earned
Contribution from General Fund
$ ì73,483
26,238
163.793
$ 963,514
Transfers out ofllie Reserve'
1999 Capital Budget Funding
212ì "Finance
2196 - Information Services
2321 - External Subdivision
2731 - Rec Complex
2950 - Y2K
$(15,000)
(388,183)
( 84,353)
(80,000)
076.769)
$ (744.305)
Pre-Audit Actual Balance - December 31, 1999
$~
1.
PUI1Jose of thiS Reserve:
This is a "discretionary" reserve fund established by Council to attempt to avoid both tax
rate fluctuations and the need for issUÌng long term debt for major expenditures required
for COID.III.unity facilities.
2. '
,Recommended Maintenance Levels of this Reserve:
As can be seen ftom the summary provided in Appendix A - the balances of this fund
have fluctuated ftom the 1999 year low of $219 thousand to the high in 1994 of $5.1
million. AdditioIÌal amounts must be allocated to this fund.
,-,.._, .__....,"'-."..."--,......,.----"..,..._".-..."....,,,_....,...,..,..,.._,..._....,......__...._,--_..,..._,_..,...."..,.,-" """'_.'" .. ",,- --.....
"Ðß
ð\~
. '.." ." '..- .." .. -.. - ..,
. ' .
! ""
APPENDIX C (page 2)
RESERVE FUND FOR DEVELOPMENT CHARGES G/L 4227/4229
Actual Balance December 31, 1998
1999 Transactions
Transfers into the- Reserve
Interest Earned
Net Developer Contributions
$5,874,293
281,469
2.552.009
8,707,771
/'
Transfers out of the Reserve
,$1 Transfer to G:Jneral Fund
-, Transfer to Capital Fund
2240 - Fire
2321 - Roads. Extema1 Subdivision
2350 ~ Transit
2718 - Parks - Acquisition
- Development
2410 - Storm Sewers,
2745 - Libraries - Materials
2610":' Planning- Studies
(1,799,375)
(163,793)
$(120,949)
(196,822)
(48,261)
(9,867)
(1,161,737)
(12a,OOO)
(130,000)
(11,739)
Pre-Audit Actual Balance - December 31, 1999
$6,744 603
1.
Purpose of this Reserve:
, This is a "obligatory" reserve fund and'as such is governed by legislation regulation or
agreement and requires revenue received for the special purposes to be segregated ftom
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 ftom
the general revenues of the municipality and the revenue is to be used solely for the
. _P~9~~,P.~~~~,~<!'þY_,~tatut~j:.,=:- in ~ c~,.~~~oni~!.~g~-~_.!Q..<iI::Y~lo-p.~ m~tÞ-e.__,
held ~ ~ and used to fund capital services required for new growth.
.,l;,r' ,
.- - ... .. ",. ... ...
2.
Recommended Maintenance Levels of this Reserve:
In accordance with development charge legislation, all development charge revenue must
be held within separate reserve funds and can only be used for the :firumcing of growth-
related projects. As such. no reserve fund limits are appropriate for development charge
reserve funds because they are tied to growth-related capital requirements.
Jl
,
APPENDIX C (page 3)
RESERVE FUND FOR CAPITAL WORKS G/L 4228
I
I
Actual Balance December 31, 1998
1999 Transactions ,
Transfers into the Reserve'
Interest Earned
Developer Contributions (refund)
Contribution ITom General Fund
$613,464
$ 23,927
$(13,990)
$202.681
212,618
Transfers out of the Reserve
0
Pre-Audit Actual Balance - December 31, 1999
$~
I '
¡
1.
Purpose of this Reserve:
This Fund is a "discretionary" one and is established pursuant to subsection 163.(2) of the
Municipal Act for specified purposes by Council related to the acquisition of assets.
2.
Recommended Maintenance Levels of this Reserve Fund:
This reserve fund has its lowest balance at the end of 1997 of $404 tho~and, with the
highest balance in the last 4 years being $1.495 million at the end of 1995, The level of
this reserve will continue to be monitored.
¡ ,
.... -, ...,. - "..
"., "" - ", -'-'.
""._."""--"."'-"'._'. '-'.""- ""
I
32
APPENDIX C (page 4)
RESERVE FUND FOR PARKLAND GIL 4230
Actual Balance December 31,1998
1999 Transactions
Transfers into the Reserve
Interest Earned
Recreational Land (c,:ash-in-lieu)
$5,778,228
260,904
148.803
6,187,935
Transfers out oithe Reserve
Transfer to Capital Fund
2132 -Town Property - Trackless Tractor
2718 -Parks - Purchase Beachpoint Promenade
""- Woodsmere Park
- Waterfront Trail
.,.. Front Street Park
- Millennium Trail
- Purchase - Abe Property
- Backhoe
- Gang Mower
- Playground Equipment & Mise
Park Development
2744 -Museum - Schoolhouse Restoration
$(72,458)
(247,$00)
(80,750)
(600,000)
(100,000)
(400,000)
(127,733)
(85,176)
(90,978)
(96,000)
(45.000)
0.945.595)
Pre-Audit Actual Balance - December 31, 1999
$4.242_;40
1.
Purpose of this Reserve Fund:
I.
I
, - - -~~(~)';~~~~å~~l r:~~~~~~t s~~~e:n:S¡~ë~5;~;)~i-,~:{~)~~~b1.- ".
the Planning Act.' , This fund is governed by legislation, regulation' or agreement and
requires revenues received for the special purposes to be segregated ttom 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.
2.
Recommended Maintenance Levels of this Reserve Fund~
Due to the obligatory nature oftbis fund, there are no limits on this fund.
1',\ q
",)..~
APPENDIX C (page 5)
RESERVE FUND FOR PUBLIC WORKS GIL 4232
Actual Balance December 31, 1998
1999 Transactions
Transfers into the Reserve
Interest Earned
Developer Contributions
$1,185,153
44,642
12.841
$1,242,636
Transfers out of the Reserve
Transfer to Capital Fund
2321-Extemal1 Subdivision Works - WoQdview
(47,981)
Pre-Audit Actual Balance - December 31, 1999
$1.194.655
1.
Purpose of this Reserve Fund:,
This fund has been established by Council pursuant to subsection 163.(2) of the
Municipal Act and is a "discretionary" reserve fund, The puxpose of the reserve funds is
to acquire fixed assets, e.g. storm sewers, without the need to fund on a long term nature
through the issue of debentures. '
2.
Recommended Maintenance Levels of this Reserve Fund:
The "average" amlual balance of this fund over the last four years has been approximately
$1.25 million. This reserve should be kept at least at this level in the future. Staff will
periodically review the need for this level with the reqlÚren1ents contained in the capital
budgets and four year program and report any different findings to Council.
I'
34
~\'I OF "'Ie'
J..O ~
~-~
~œ:~
~
REPORT TO COUNCIL
FROM:
Gillis A. Paterson
Director of Finance & Treasurer
DATE: June 17,1999
REPORT NUMBER: FIN 16-99
SUBJECT:
1998 Pre-Audit Balances of Reserves and Reserve Funds
RECOMMENDATION:
It is recommended that this Report No. FIN 16-99 be received by Council for infonnation.
ORlGIN:
. Report submitted annually to Council
AUTHORITY:
Municipal Act, R.S.O, 1990, as amended, Sections 162 and 163
Ontario Regulation 438/97 ..
FINANCIAL IMPUCATIONS:
. Not applicable.
1----'--------------
-----
-----------
'--------- ---
EXECUTNE SUMMARY:
This report provides specific infonnation on each of the Town's reserves and reserve funds,
including year end balances. Compared to prior years the current year end balances present a
favourable trend of increase rather than decline. The Finance Department wiIJ endeavour to
continue this direction to improve the overall financial position of the Town.
'-' .
BACKGROUND:
I
t
Based on the preliminary 1998 results, we can now report on the pre-audit actual activities within
the reserves and reserve funds for 1998. Caution must be exercised in using this infonnation, as
the Town Auditors have not yet finished their review due to possible financial implications of
Bill 79 (Capping Legislation).
The "purpose" ånd the "recommended maintenance level" for each reserve and reserve fund are
' set out in Appendices B and C respectively. 3 5
, .,.._--,-,--
Report to CounciÎ FIN 16-99
Jund 17, 1999
Subject: 1998 Pre~Audit Balances of Reserves and Reserve Funds
Page 2
ATTACHMENTS:
1.
2,
3,
Appendix A Summary of Reserve & Reserve Funds
Appendix 13 Description of Reserves
Appendix C Description of Reserve Funds
Prepared By:
Approved / Endorsed By:
~~~
J. , omlinson,
Deputy Treasurer
----?ø~ ~
~ - ,
r-
G,A. Paterson,
Director of Finance & Treasurer
Recommended for the consideration of
Pickering Town Council
Thomas J, Quinn, Chief Administrative Officer
GAP:vw
Attachments
/' _. '-.._,.. - . - ----~-- .. '..--. --.---- -- ----- ..-, --'.. -- ., - ..,
I-'
:36
A1TACHMENT#L. TO RE?ORT#~/'- 99
APPENDIX A
'I.
SUMMARY
TOWN OF PICKERING
SUMMARY OF RESERVE AND RESERVE FUND ~RE-AUDIT ACTUALS
DECEMBER 31, 1998
r
I
Pre-Audit Actuals Actuals
Appendix B Summarv of Reserves 1998 lli1 lli2 1995
4610/4617 ' Working FundsIV acation Pay $ 841,350 $841,350 $ 841,350 $830,000
4611 Rep1ac::ment of Capital 1,829,610 175,914 1,453,125 613,639
Equipment
4612 Contingencies 786,319 264,319 194,440 30,000
4613/4614 Self Insurance/Inv::I1tories 579,123 452,207 458_054 464,206
4618 Reskilling 0 83,900 83,900 495,000
4619 . Rate Stabliliz:¡tion 1.973.817 0 0 0
$6,010.219 $1.817.690 $3.031.769 $2.432.845
¡
I,
I' -....-... -,-, ------.--:"-..--'....---.---'.'--.---------'.--.' ----.-.._-
, Appendix C
Summarv of Reserve Funds
199B lli1 1996 . 1995
$ ,773,483 $ 447,280 $ 1,404,317 $ 2,089,572
5,874,293 6,145,652 5,016,146 2,927,179
613,464 403,758 ' 1,342,783 1,494,642
5,778,228 4,161,322 4,690,984 4,326,047
1.185.153 1.096.536 --_..__~~18}.44~ "..,,1~02!319.
14.224.621 $12.254.548 $13.637.678 $12,239.759
4225
4227
4228
4230
4232
Community Facilities
Development Charges
Capita] Works
Parkland
Public Works
l-
I
Total Reserve and Reserve Funds
S20.2:14J!40
$14.072.2:18 $J 6.669,447
$14.672.604
I '
j
'-'
T7
APPENDIX B
ATTACHMENT # ~ TO REPORT # :£uL/~ "17
- '
RESERVE FOR WORKING FUNDSNACATION PAY G/L 4610/4617
Actual Balance December 3'1, 1997
1998 Transactions
Transfers into the Reserve
Working Funds
Vacation Pay
$841,350
0
0
Transfers out of the Reserve
0
Pre-Audit Actual Balance December 31, 1998
Working Funds
Vacation Pay
$400,000
441.350
$~
1.
Purpose of the Reserves:
The reserve for working funds is used to provide operating cash to assist in avoiding short
term interest expenses incurred on operations during the first months of the year prior to
tax billing, . .
¡
¡
The reserve for vacation pay has been established to ensure that the cost of vacation pay
earned, but not taken, is correctly allocated to the taxpayers of that year and the Council.
of that period.
I.
1
1.
Recommended Maintenance Levels of the Reserves:
¡ ""~- ,. '._--"'."'--'."- --, -"-R~-;e~.f;Wo~ki~g Funds - Î~"js r~cormnended as a "ru~e-of-~~~~:~~~t t~i~-r~s~~e~~;--.-----'-------'-'--
exceed 1 % of total revenues. The present balance approximates that amount.
I.
Reserve for Vacation PaY .. This reserve should be equal to the vacation pay earned, but
not taken in any given year. Any difference would be taken into consideration in the next
year's budget. '
"
) "
$~ 8
\
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ATTACHMENT # -4- TO REPOR.T#£uJJ.'~f1 '
APPENDIX B (Page 2)
RESERVE FOR REPLACEMENT OF CAPITAL EQUIPMENT G/L 4611
Actual Balance December 31, 1997
1998 Transactions
Transfers into the Reserve
1998 Budget
General Government Provisions
Various Recreation Revenues
$ 175,914
$1,663,734
] 04.962
1.768.696
Sub-total
$1,944,610
Transfers out of the Reserve
1998 Cont. to General Fund
- Termination Settlements
015.000)
Pre-Audit Actual Balance - December 31, 1998
$1.R29.61 0
1.
Purpose of this Reserve:
The pÙrpose of this reserve is to eliminate 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 mill rate fluctuations and the issuance of long tenn debt or other means of
financing,
2.
Recommended Maintenance Levels of this Reserve:
, '.",-- '_. Thisreserve"'shollld-b~-keþnnr-lëvêl'Whìch-ls-'eqüiValeñnë" IhercplâêemeñrëëisTõTllie---'- -. ---~- -. -- --
assets for which they were established. The reserve has fluctuated from the 'low as at
December 31, 1997 of $175,914 to a high of $1.95 million at the end of 1994. An
additional provision of $1,141,000 is provided for in the cucrent budget but this account
continues to be underfunded, Major additional contributions will be required in future
years,
:11
ATTACHMENT#~ TO REPORTf!£ÆLIf,-Q1
APPENDIX B (Page 3)
RESERVE FOR CONTINGENCIES G/L 4612
Actualllalancc Dcccmber 31,1997
1998 Transactions
Transfers into the Reserve
1998 Budget
- General Government - Election Provision
- Assessment Appeals
$264,319
Sub-tota] ,
55,000
467,000
522.000
786,319
Ii
I
Transfers out of the Reserve
0
Pre-Audit Actual Balance - December 31, 1998
$786.31 ~
I
II
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 ITom time to time.
1'" .... - .""---,, ""'--" :t------RëëõmlñëñðèëfM"ãìïitenañ'ce-révefs-õHitlsReservë:-...- - , ., -..-.. -----, ,..,,---,,-- .,.. ---'---'
Staff continue to monitor the balance of this reserve and the need for long term
contributions required..
, -. .. --... .
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..
46
ATTACHMENT#..L TO REPOR.T#£.J1L¡~-<fI
APPENDIX B (Page 4)
RESERVE FOR SELF INSURA.NCEIINVENTORY G/L 4613/4614
Actual Balance December 31,1997
1998 Transactions
Transfers into the Reserve
- Inventory Adjustment
- Insurance Premiums Under Budget Provisions
. 98 Provison
$ 452,208
770
51,145
75.000
126,915
Transfers out of the Reserve - Inventory Adjustment
Pre-Audit Actual Balance - December 31, 1998
$~
(Transfers based on actuaìs at ye:¡r end)
1.
Purpose of this Reserves:
Reserve for self-insurance
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This'reserve was established as a fo.rm of asset protection- Specifically; it is to cover
insurance claims resulting from the increase in deductible levels to reduce insurance
premiums. Significant savings can be realized through reduced premium costs and staff
analyze thecosts/benefits of such actions on an annual basis,
¡ ,
Reserve for Inventory
This reserve has been estab1ished to ensure that the cost of revolving inventories is
,- --- ,. -_..,,",.,--- -- .cõ'ifeënÿ-ãl1öcatéino iliêfiîXpãyëï.=Softliáfyeär'ãriàtfíëC:oÚñCiTôffuitpenocEhh-- '_h""""_,,,----, --- -- --- -.", ..
I,
I
2.
Recommended Maintenance Levels of this Reserve:
Reserve for self insurance
I'
This reserve should be maintained at a level to ensure that the funding is adequate to meet
actuarialliabiIities. This situation is analyzed by staff on a regular basis.
Reserve for Inventory
The maintenance level required is explained in the Description of the purpose for this
reserve.
41
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ATTACHME:NT#:¿ . ,
--- TO REPORT # ..E!.tL
APPENDIX B (Page 5) I (fø~ q?
RESERVE FOR RESKILLING AND REDEPLOYMENT G/L 4618
Actual Balance Dec~mber 31, 1997
1998 Transactions
Transfers into the Reserve
$83,900
0
Transfers out of the Reserve
- Transfer to General Fund per 98 Budget
(83.900)
Pre~Audit Actual Balance - December 31, 1998
LJ
1.
Purpose of this Reserve: '
This reserve was established to set aside funds for seminars, education and redepJbyment
of staff.
2.
Rccommcndcd Mnintcnnncc-Lcvcls of this Rescrvc:
These expenditures are now controlled through each individual operating budget.
".., """"'_"h"'._'"""", "'".,-"..."""'--' """"--"."'."'-"""...h"""_"""""-"".",,,-,- -"'-"""""""-""""'.'--"'" '.."",-".., """"'" '...."_h' ..,. """-..
42
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ATTACHMENT#~ TO REPORT#.fLt:L¡(..~.qq
APPENDIX B (page 6)
RESERVE FOR RATE STABILIZATION G/L 4619
Actual Balance December 31, 1997
1998 Transactions '
Transfers into the Reserve
- 1998 Provision to Establish Account
Transfers out of the Reserve
Pre-Audit Actual Balance - December 31, 1998
1. Purpose of this Reserve:
$
0
1,973,817
0
$1.973.R17
The purpose of this reserve is to act as a mill rate stabilization factor for annual CUlTent
budget funding.
2.
Recommended Maintenance Levels of this Reserve:
The level of this reserve will continue to be monitored,
,.. -, -.. .....
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43
APPENDIX C
ATTACHMENT#..:=L TO REPORT # t-,,¡ ..
',¡_J-lY-.!(, - Y1
RESERVE FUND FOR COMMUNITY FACILITIES G/L 4225
Actual Balance December 31,1997
1998 Transactions
Transfers into the Reserve
Interest Earned
Contribution from General Fund
$ 447,280
Transfers out of the Reserve
1998Capital Budget Funding
21,194
1.075.758
$1,544,232
2124 - Civic Complex
2132 - Town Property Maintenance
2196 - Infonnation Services
2321 .. Ext=al Subdivision
2745 - Libraries
$(95,495)
(12,500)
(120,000)
(412,8ü2)
(J 29.952)
(770,749)
Pre-Audit Actual Balance - December 31, 1998
$~
1.
Purpose of this Reserve:
This is a "discretionary" reserve fund established by Council to attempt to avoid both tax
rate fluctuations and the need for issuing long tenn debt for major expenditures required
for community facilities,
2.
Recommended Maintenance Levels of this Reserve:
... '-"""'-""""""""""""-"-""""""""""""""""'-"".."""""""""""""""""""""""""""""""""""""""""""", .".....,
no...".................,.,.."
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As can be seen from the summary provided in Appendix A - the balances of this fund
have fluctuated from the 1997 year low of $447 thousand to the high in 1994 of $5.1
million. Additional amounts must be allocated to this fund.
44
ATTACHMENT #-3- TO REPORT#...i:LJ1./(" -11
APPENDIX C (Page 2)
RESERVE FUND FOR DEVELOPMENT CHARGES G/L 4227
Actual Balance December 31, 1997
1998Transactions
Transfers into the Reserve
Interest Earned
Net Developer Contributions
$6,145,652
345,281
2,868.464
9,359,397
Transfers out of the Reserve
Transfer to General Fund
Transfer to Capital Fund
2127 -Finance-Growth Studies
2321 -Roads - External Subdivision
2718.- Parks - Acquisition
- Development
2745 - Libraries - Materials
(1,654,877)
$(50,000)
(963,204)
(71,262)
(652,613)
(93.148)
$(1.830,227)
)
Pre-Audit Actual Balance - December 31,1998
$5~874.293
1.
Purpose of this Reserve:
This is a "obligatory" reserve fund and as such is governed by legislation regulation 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
'.. Þ ufþosëqj res en bedoY ì¡tã fÜt ë:" I ïi'iiithiš-ëãS-etliem ames' Cîiãrge<f to-a eveIo perš'm usf-be' , ".,.
held in trust and used to fund caJ:1ital services required for new growth.
1
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2.
Recommended Maintenance Levels of this Reserve:
In accordance with development charge legislation, all development charge revenue mùst
be held within separate reserve funds and can only be used for the financ]ng of growth-
related projects. As such, no reserve fund limits are appropriate for development charge
reserve funds because they are tied to growth-related capital requirements.
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ATTACHMENT,/- -,
, I -0:;5-- TO REPORT # Ç¡t{/~-1q
APPENDIX C (Page 3)
t
RESERVE FUND FOR CAPITAL WORKS G/L 4228
Actual Balance December 31,1997
1998Transactions
Transfers into the Reserve
Interest Earned
Developer Contributions (refund)
Contribution from General Fund
$403,758
$19,426
$(10,500)
$200.780
209,706
Transfers out of the Reserve
0
Pre-Audit Actual Balance - December 31,1998
$613.464
1.
Purpose of this Reserve:
This Fund is a "discretionary" one and is established pursuant to subsection 163.(2) of the
Municipal Act for specified purposes by Council related to the acquisition of assets,
2.
Recommended Maintenance Levels of this Reserve Fund:
This reserve fund has its lowest balance at the end of 1997 of $404 thousand, with the
.,þigh~~t_~~!¡tI1_~e.i_~_!~eJ_~t+Y~-~_,þ,~i~g.~ l,49~,~HU()I!,~ttþ,~. e_nQ. oKJ99,~,_.IÞ.c:lçY~lJ)J..,. ,
this reserve will continue to be monitored,
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ATTACHMENTt/3.. Tr
,1 REPORT #.£It\L If.. -q<7
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APPENDIX C (Page 4)
RESERVE FUND FOR PARKLAND G/L 4230
Actual Balance December 31, 1997
1998Transaetions
Transfers into the Reserve
Interest Earned
Recreational Land (cash-in-lieu)
Contribution from Genera! Fund
$4,161,322
253,327
735,466
1.074.753
6,224,868
Transfers out of the Reserve
Transfer to Capital Fund
2718 -Parks - Purchase Rosebank Property
-FairpOrt & Bonita
-Miscellaneous Park
Development
$(141,567)
$(181,740)
(123.333)
(446,6401
Pre-Audit Actual Balance - December 31, 1998
$5.778.228
1.
Purpose of this Reserve Fund:
I'
This is an "obligatory" reserve fund and it has been established pursuant to subsection
163,(2) of the Municipal Act as required by subsections 42.(1), (5), (6), (7), (8) and (9) of
,g~~) !~~,r1.g ... !\~~~- ,.~s_fl1!1~I}~ - g() v ex:!l~~ -_þy- J e gi~!~ti ~!1, .,r:~g~l~~i9,~<?~_,~gx:~~~!l !._~I1<!,.- .
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,
¡ ,
2.
Recommended Maintenance Levels of this Reserve Fund:
Due to the obligatory nature ofthis fund, there are no Jirnits on this fund.
47
AlTACHMENT#3- TO REPO~~#£úLJ<"'-11
APPENDIX C ' (Page 5)
RESERVE FUND FOR PUBLIC WORKS G/L 4232
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Actual Balance December 31, 1997
1998Trallsactions
Transfers into the Reserve
fntcrcst Earned
Developer Contributions
$1,096,536
58,954
29,663
Transfers out of the Reserve
0
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Pre-Audit Actual Balance - December 31, 1998
$1.1 R~.153
1.
Purpose of this Reserve Fund:
This fund has been established by Council pursuant to subsection 163,(2) of the
Municipal Act and is a "discretionary" reserve fund. The purpose ofthe reserve funds is
to acquire fixed assets, e.g, stonn sewers, without the need to fund on a long tem1 nature
through the issue of debentures.
2.
Recommended Maintenance Levels of this Reserve Fund:
The "average" annual balance of this fund over the last four years has been approximately
, """'$L2S-fuì1liötL "'Thiï¡ieserveshöüldbë' kepfärleast"änhisleVël- ifCthefuturë:'$lãffwill
periodically review the need for this level with the requirements contained in the capital
budgets and four year program and report any different findings to Council.
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48
~~ OF PIc.
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REPORT TO COUN
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FROM:
G. A. Paterson
Director of Finance
DATE: April 7, 1998
REPORT NUMBER: TR 14/98
SUBJECT:
1997 Pre-Audit Balances of Reserves and Reserve Funds
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RECOMMENDATION:
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It is recommended that this Report No. TR 14/98 be received by
Council for information.
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ORIGIN:
Report submitted annually to Council
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AUTHORITY:
Sections 162 and 163 of the Municipal Act and Ontario Regulation 438/97
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,
, FINANCIAL IMPLICATIONS:
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Not applicable.
I" " EXECUTIVE SUMMARY:
r~-::----:'-------'- ,
This report provides specific information on eaèh of the Town's reserves and
reserve funds, including year end balances. Most important is the decline in total
balances of some $4 million, appròximately 22 per cent, from $18 million in 1994
to $14 million in 1997.
,-'---,--'.'
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BACKGROUND:
, ,
, ,
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Based on the preliminary 1997 results, we can now report on the pre-audit actual '
activities within the reserves and reserve funds for 1997. Caution must be
exercised in using this information, as the Town Auditors have not yet finished
their review.
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The "pmpose" and the "recommended maintenance level" for each reserve and
reserve fund are set out in Appendices B and C respectively;
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Report to Council TR 14/98
April 7, 1998
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Subject: 1997 Pre-Audit Balances of Reserves and Reserve Funds ,
Page 2
~ '
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, ATTACHMENTS:
,~.....,.
,1.
2.
3.
Appendix A Summary of Reserve & Reserve Funds
Appendix B Description of Reserves
Appendix C Description of Reserve Funds
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Prepared By:
- ----£: 4$~ " (-~
, Gillis A. Paterson
Approved / Endorsed By:
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Attachments
Copy: General Manager
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ATTACHMENT #-2- TO REPORT #!!L1. 4/98
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APPENDIX A
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SUMMARY
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TOWN OF PICKERING
SUMMARY OF RESERVE AND RESERVE FUND PRE-AUDIT ACTUALS
DECEMBER31,1997
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Pre-Audit Actuals ~
Appendix B Summary of Reserves 1997 1996 1995 1994
4610/4617 Working FundsN acation Pay $841,350 $ 841,350 $830,000, $830,000
4611 Replacement of Capital 175,914 1,453,125 613,639 1,954,973
Equipment
4612 Contingencies 264,319 194,440 30,000 115,811
4613/4614 Sel f Insurance/! nventories 452,207 458,954 464,206 443,197
4618 Reskilling 83,900 83,900 495,000 3 ¡ 5,000
$1,817,690 $3,031,769 $2,432,845 $3,658,981
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4225 Community Facilities $ 447,280
4227 Development Charges 6,145,652
4228 Capital Works 403,758
4230 Parkland 4,161,322
I. 4232 Public Works 1,096,536
.,..- ._..,-,_., --'-'--'--""------...--,-,----.---'----,-.---. "--'----'--'--'-$1'2~254,54'8
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Appendix C
Summary of Reserve Funds
1997
1996 '
1995
1994
$ 1,404,317 $ 2,089,572 $ 5,072,924
5,016,146 2,927,179 2,599,842 "\
1,342,783 1,494,642 1,421,174 \"., ,
4,690,984 4,326,047 4,016,980,,~
, -'-
1,183,448 1,402,319 1,295,819 . '
--$T3,637;67r-'$I2',:.r39, 735) ---$-14;'4ô6~739 "--------:-- ,-
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Total Reserve and Reserve Funds
$14,072,238
$16,669,447 $14,672,604
$18,065,720
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ATTACHMENT #2- TO REPOR.T#..!!:.4/98
APPENDIX B
RESERVE FOR WORKING FUNDSNACATION PAY G/L 4610/4617
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Actual Balance December 31, 1996
1997 Transactions
Transfers into the Reserve
Working Funds
Vacation Pay
$841,350
0
0
-
Transfers out of the Reserve
0
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Pre-Audit Actual Balance December 31,1997
Working Funds
Vacation Pay
$400,000
441,350
$841,350
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1.
Purpose of the Reserves:
The reserve: for working funds is used to provide operating cash to assist in avoiding short
term interest expenses incurred on operations during the first months of the year prior to
tax billing.
I':
The reserve for vacation pal:' has been established to ensure that the cost of vacation pay
earned, but not taken, is correctly allocated to the taxpayers of that year and the Council
of that period.
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2.
Recommended Maintenance Levels of the Reserves:
1..,....,-----.-,..------..--..,..-,...--;,
Res~ ¡ye J 0 r W'.o.rkingE un cis. ,~Jtis..rec.ommended..as,~rule..o f-thumb~tha Uhi Hes erve-n 01---- -.._"~.._'- -,---,. -..."
exceed 1 % of total revenues. The present balance approximates that an10unt.
Reserve for Vacation Pay - This reserve should be equal to the vacation pay earned, but
not taken in any given year. Any difference would be taken into consideration in the next
year's budget.
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ATTACHMENT #2- TO REPORT#.!L.14/98
APPENDIX B (page 2)
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RESERVE FOR REPLACEMENT OF CAPITAL EQUÎPMENT G/L 4611
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Actual Balance December 31, 1996
1997 Transactions
Transfers into the Reserve
1997 Budget
Various Recreation Revenues
$1,453,126
....
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$78,395
78,395
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Sub-total
$1,531,521
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Transfers out of the Reserve
1997 Capital Financing
2132 - Town Property Maintenance
2199 - PrintIMail Room
2240 - Fire
2259 - PAR.U. Rescue Vessel
2290 - Public Works
2320 - Roads
2350 - Public Transit
2360 ~ Transit - Specialized Services
2718 - C.S.& F, - Parks
$18,287
18,759
413,775
60,000
30,488
- 150,103
573,980
35,390
54,825
(1,355,607)
Pre-Audit Actual Balance - December 31, 1997
$175,914
1.
Purpose of this Reserve:
The purpose of this reserve is to eliminate 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
I----~._- ---,-=::;:.".'l1.~ilI..~~~~ns ~dfu.". i":",,':..~l~~g ~~~"': ":..~ ."E.~ ---.....:-~ -
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2.
Recommended Maintenance Levels of this Reserve:
This reserve should be kept at a level which is equivalent to the replacement cost of the
assets for which they were established. The reserve has fluctuated from the low as at
December 3 I, 1997 of $176,002 to a high of $1.95 million at the end of 1994. StaffwiIl
be determining the adequacy of the CUlTent balance and the required long tenn
contribution requirements.
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ATTACHMENT#~ TO REPORT#!!l:/98
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APPENDIX B (page 3)
RESERVE FOR CONTINGENCIES GIL 4612
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Actual Balance December 31,1996
1997 Transactions
Transfers into the Reserve
1997 Budget
, . General Government & W.C.B. Rebate
.
$194,440
Sub-total
126,879
321,319
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Transfers out of the Reserve
- Election Provisions from 1995 & 1996
57,000
(57,000)
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Pre-Audit Actual Balance - December 31, 1997
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$264,319
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1.
Purpose aftbis Reserve:
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Like the Gapita! 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.
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2.
Recommended Maintenance Levels of tbis Reserve:
I.... ------,-.--. ------ Staff will be reassessing t11~ --~~ip~~~~Z:¡.t:.~ci.--fo!~~~h._¿¡l~~t::.I:Y.!U!!.1(La.!IL¡Qng.J~J.m",--_.-.------.-------.--..
--- """'-ëOIilri5lïtÍoñiêqüÌrementS.--' ..
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54
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ATTACHMENT#-L TO REPORT#l:JU..{V98
APPENDIX B (page 4)
RESERVE FOR SELF INSURANCEIINVENTORYGIL 4613/4614
ActunJ Balance December 31, 1996
1997 Transactions
Transfers into the Reserve
$458,954
0
Transfers out of the Reserve - Inventory Adjustment
(6,747)
I'
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Pre-Audit Actual Balance - December 31,1997
$452,208 *
(Transfers based on actuaJs at year end)
Note: ... Doesn't balance to the dollar because ofrounding
1.
Purpose of this Reserves:
Reserve for self-insurance
This reserve was established as a fonn of asset protection. Specifically, it is to cover
insurance claims resulting nom the increase in deductible levels to reduce insurance
premiums. Significant savings can be realized through reduced premium costs and staff
analyze the costs/benefits of such actions on an annual basis.
,-
Reserve for Inventory
This reserve has been established to ensure that the cost of revolving inventories is
I" m- ---, -- ---_-'_._m__- -- - ---~~~:rect1y a_~_~=::=-~~~~~_~~a~~_~:.~!~!_t):~~~nd ~-~-~?_~~~I~!~~~~!P_:~~~'_-~ --'--"--'---'-"---- ..-------._----
2.
Recommended Maintenance Levels of this Reserve:
Reserve for self insurance
This reserve should be maintained at a level to ensure that the funding is adequate to meet
actuarial liabilities. This situation is analyzed by staff on a regular basis.
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Reserve for Inventory
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The maintenance level required is explained in the Description of the purpose for this
reserve.
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AITACHMENT#-2.., TO REPORT#.2!. 14/98
APPENDIX B (page 5)
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RESERVE FOR RESKILLING AND REDEPLOYMENT G/L 4618
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Actual Balance December 31,1996
1997 Transactions
Transfers into the Reserve
$83;900
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Transfers out of the Reserve
0
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Pre-Audit Actual Balance - December 31, 1997
$83,900
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1.
Purpose of this Reserve:
This reserve was established to set aside funds for seminars, education and redeployment
of staff. -
2.
Recommended Maintenance Levels ofthis Reserve:
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Staff assess the anticipated needs for such a reserve on an ongoing basis and at the same
time determine the long tenn contribution requirements.
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ATTACHMENT#-L. TO REPORT#.!ll4/98
..
APPENDIX C
.,
RESERVE FUND FOR COMlVIUNITY FACILITIES G/L 4225
I ..
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Actual Balance December 31, 1996
1997 Transactions
Transfers into the Reserve
Interest Earned
Contribution from General Fund
$1,404,317
53,363
304,542
,
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Transfers out ofthe Reserve
1997 Capital Budget Funding
I..:
I
2124 - Civic Complex
2196 - Information Services
2321 - External Subdivision
2731 - Rec. Complex - Central
2745 - Libraries
. $(26,864)
(474,819)
(285,392)
(114,087)
(413,780)
(1,314,942)
) .'
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Pre-Audit Actual Balance - December 31,1997
$447,280
1.
Purpose of tbis Reserve:
I .'
This is a "discretionary" reserve fund established by Council to attempt to avoid both tax
rate fluctuations and the need for issuing long tenn debt for major expenditures required
for community facilities. .
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.~ 2. Recommended Maintenance Levels aftbis Reserve:
~ """--"'--"".-"--". ---'..-'.
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As can be seen from the summary provided in Appendix A - the balances of this fund
have fluctuated from the current four year low of $447 thousand to the high in 1994 of
$5.1 million. Staff will be assessing the adequacy of the current balance in this fund in
- relation to the proposed major applicable expenditures in the 1998 capital budget and four
year forecast and report their findings to Council. .
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ATTACHMENT#--1-TOREPORT#-IBl4/98
....-.,.,
APPENDIX C (Page 2)
RESERVE FUND FOR DEVELOPMENT CHARGES G/L 4227
-Actual Balance December 31,1996
1997 Transactions,
Transfers into the Reserve
Interest Earned
Net Developer Contributions
$5,016,146
316,454
3,133,000
Transfers out of the Reserve
Transfer to General Fund
Transfer to Capital Fund
2321 -Roads - External Subdivision
2718 - Parks - Acquisition
- Development
2745 - Libraries - Materials
- Facilities
(304,542)
$(665,915)
(83,606)
(914,547)
(75,240)
(276,097)
(2,015,405)
Pre-Audit Actual Balance - December 31, 1997
$6,145,652 ."
* Note: Does not balance to the dollar because ofrounding
1.
Purpose of this Reserve:
This is a "obligatory" reserve fund and as such is governed by legislation regulation 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 . .
. -. .--..,.. .... ---l1êlifiñ"tru'štãïiatïSë,fto:fUñëf ëãpÌ fillservÌcesrequirëéî'fõriïëW'groWtl-ï:"------" ,..- .-..--~-"-_..._--- ....-- _..-...------ ---
2.
Recommended Maintenance Levels of this Reserve:
In accordance with development charge legislation, all development charge revenue 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 development charge
reserve funds because they are tied to growth-related capital requirements.
" '
..::;
.---
58
ATTACHMENT#~TOREPORT#TR14/98
APPENDIX C (page 3)
I .
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RESERVE FUND FOR CAPITAL WORKS G/L 4228
.1 ,
.
. Actual Balance December 31, 1996
1997 Transactions
Transfers into the Reserve
Interest Earned
Developer Contributions (refund)
$1,342,783
"'.
$33,228
$(7,000)
26,228
¡ :
. Transfers out of the Reserve
Transfer to Capital Fund
2320 - Roads
2718 - Community Centres
(107,179)
(858,074)
(965,253)
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Pre-Audit Actual Balance - December 31,1997
$403,758
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1.
Purpose of this Reserve:
This Fund is a "discretionary" one and is established pursuant to subsection 163,(2) of the
Municipal Act for specified purposes by Council related to the acquisition of assets.
2.
Recommended Maintenance Levels oftbis Reserve Fund:
\
\
This reserve fund has its lowest balance at the end of 1997 of $404 thousand, with the
.. .- ---""..-.-..-. -- ...--. .__._~~i~!l~::~~~~~~_i~_!I.::_~~.~~.~?'_~~:~~:~!11?~~._~?-?~}}!~o_~-~!l!-~~n.~~f_!_~?~~_._--_._.._---_.. ""--...-.,...... -- ~.- -
Staff will be assessing. the adequacy of the current balance in this fund in relation to the
proposed major applicable capital expenditures in the 1998 Capital Budget and Four Year
Forecast and report their findings to Council.
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ATTACHMENT#--L TOREPORTø..IJU.4/98
APPENDIX C (page 4)
RESERVE FUND FOR PARKLAND G/L 4230
Actual Balance December 31,1996
1997 Transactions
Transfers into the Reserve
Interest Earned .
RecreatIonal Land (cash-In-lieu)
$4,690,984
335,472
282,265
Transfers out of the Reserve
Transfer to Capital Fund
2718 -Parks - Purchase McKean
Property
- Miscellaneous Park
Development
"
$(954,612)
(1,147,399)
(192,787)
Pre-Audit Actual Balance - December 31, 1997
$4,161,322
1.
Purpose of this Reserve Fund:
...
.:~.
This is an "obligatory" reserve fund and it has been established pursuant to subsection
163,(2) of the Municipal Act 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..tbe....m.unicipality....andthe-revenueis.to.be-used solely -fo r- the.purposeprescri bed-by"'.'."'.' ..', .
statute.
.."". ".... ."".'.'"
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2.
Recommended Maintenance Levels of this Reserve Fund:
"-""',_...
Due to the ob1igatory nature of this fund, there are no 1imits on this fund.
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ATTACHMENT#~ TO REPORT. TR14/98
-......,...
APPENDIX C (Page 5)
RESERVE FUND FOR PUBLIC WORKS GIL 4232
..'
"
'Actual Balance December 31,1996
'. 1997 Transactions
Transfers into the Reserve
Interest Earned
Developer Contributions
Transfers out of the Reserve
Transfer to Capita! Fund
2320 - Roads
Pre-Audit Actual Balance - December 31,1997
1.
Purpose of tItis Reserve Fund:
..
$1,183,448
\,
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72,570
119,232
(278,714)
51,096,536
..
This fund has been established by CounciI pursuant to subsection 163.(2) of the
Municipal Act and is a "discretionary" reserve fund. The purpose of the reserve funds is
to acquire fixed assets, e.g, storm sewers, without the need to fund on a long term nature
through the issue of debentures. .
2.
Recommended Maintenance Levels ofthis Reserve Fund:
",'
,;
, The "average" annual balance of this fund over the last four years has been approximately
- --$1:25--miHio n;'-"-'fhis' res eive'sho u 1 db e'" kC:þt"ät ."this--Ievenñ .,' the'fütUie:--Siã.ff 'wI lr-'
periodically review the need for this level with the requirements contained in the capital
budgets and four year program and report any different findings to Council.
61
.,
...
..
"
....
, '
TOWN OF PICKERING
NOTES TO THE CONSOLIDATED FINANCIAL STATElVIENTS
AS AT DECEMBER 31. 1999
6.
Reserve Funds and ReserVes
The total balances of reserve funds and reserves of $13,226,889 (1998 - $14,224,622) and
$8,438,763 (1998 - $5,822,634) respectively are made up of the following:
1999
1998
Reserve funds set aside for specific purposes by Council:
- For recreation programs and facilities
- For acquisition of fIXed assets
$
219,209
2,020,737
$
773,483
1,798,618
2,239,946
2,572,101
Reserve funds set aside for specific purposes by
legislation, regulation or agreement:
- Development charges act
- For park purposes
6,744,603 5,874,293
4,242,340 5,778,228
10,986,943 11,652,521
$ 13,226,889 . $ 14,224,622
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Total Reserve Funds
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Reserves set aside for specific purposes by Council:
- For working capital $ 400,000 $ 400,000
- For self insurance 467,809 376,146
- For inventories 245;271 202,978
- For replacement of capital equipment 2,521,806 1,829,610
- For contingencies 1,822,645 1,227,668
- For rate stabilization 2,981,232 1,786,232
Total Reserves $ 8,438,763 $ 5,822,634
g¡;,~" r:;;Tetl. t~,ZI(ll" (i!t<'I"",',ul. (CCOUII"""B
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CONTINUITY OF RESERves
AND RESERve FUNDS
Pickering T
10
lor tho y..r ended D_borJ1. 1...
15
~
~
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.
~
I
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Balance at the beginning of the year
Revenues
Contributions from revenue fund
Contributions from capital fund
Development Charges Act
Lot levies and subdivider contribuUono
Recreational land (tha Planning Act)
Investment income - from own funds
- other
-
-
-
-
Expenditures
Transferred to capital fund
Transferred to revenue fund
Charges for long term IIabiIItIes-prin and interest
-
-
-
Balance at the end of the year to~
Reserves
Reserve Funds
.
~
1
Anaiysod as follows:
Reserves and discretionary reserve funds:
WorKing funds
Contingencies
Ontarto Clean Water Agency funds lor renewals. etc.
-sewer
-waler
Replacement of equipment
SIc!< leave
Insurance
WorKers' compensation
Capital expendllura-generat administraUon
-roads
-sanltøry and stoon sewers
-pa... and recreation
-library
-other cultural
-water
-transit
-housing
-Industrial development
-other and unspec;fied
WatelWOrKs current purposes
Transit currant purposes
Ubrary culTSnt purposes
Inventory
Rate Stabilization
-
Obligatory reserve (unds:
Development Charges Act
Lot levies and subdivider contributions
Recreational land (the Planning Act)
Par1<ing revenues
Debenture repayment
Exchange rate stabIlIzatIon
~
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-
-
163
1
S
20,047,25
2
3
87
so
61
I
3.678,9461
I
U;52.00g¡
-1,1491
148.8031
428.2731
2;0;901
5
a
9
10
11
12
Total revenue 13
7,015.78
14 4,537,255
15 ._- .... 860,1361
---,..-,
'6
63
20
21
T0t31 expenditure 22
------
5.397,39
23
24
Total 25
8,438,76
13,226.88¡
21.665,65
26
27
I
,------ 400,oJ
1.822,64.
28
29 f-----
30 2.521.801
~ 487,80J
33 ----- ----
34---
35
36
64
65
---
..
38
39
40
41
219,20
~þ,',-','~
53 ,,-, 2.98123'-
64, ,-, -_..
, I
sa 1-- - - 6.744,60
.4 .- ' -
46 ; 4,242,34(
::'~~
48
55 ,
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TOWN OF PICKERING
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
AS AT DECEMBER 31. 1998
I
III.
7.
Reserves and Reserve Foods
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,
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The total balances of reserves and reserve foods of $5,822,634 (1997 - $1,817,690) and
$14,224,622 (1997 - $12,254,548) respectively are made up of the following:
1998
1997
J
II
II
Reserves set aside for specific purposes by Cooocil:
- For working capital $ 400,000 $ 400,000
- For self insurance 376,146 250,000
- For inventories 202,978 202,207
- For replacement of capital equipment 1,829,610 175,914
- For contingencies 1,227,668 705,669
- For reskilling and redeployment 83,900
- For rate stabilization 1,786,232
Total Reserves $ 5,822,634 $ 1,817,690
1
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Reserve foods set aside for specific purposes by Cooocil:
- For recreation programs and facilities
- For acquisition of fixed assets
1998 1997
$ 773,483 $ 447,280
1,798,618 1,500,294'
2,572,101 1,947,574
Reserve funds set aside for specific purposes by
legislation, regulation or agreement:
Total Reserve Foods
5,874,293 6,145,652
5,778,228 4,161,322
11,652,521 10,306,974
$ 14,224,622 $ 12,254,548
- Development charges act
- For park purposes
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CONTINUITY OF RESERVES
AND RESERVE FUNDS
Murndp.Uly
I
Pickering T
10
15
f",th. yoor.ndod 0"""mbo'31, '991
I
,
1
$
Salanco at tho bog!nnlng of tho year 1 14,072,238
Rovenuos
Contributions from rovenue fund 2 5,279,60
Contributions from capitol fund 3
Development Charges Ad 81 2,866,464
Lot levies and subdivider contributions 60 19,16"3
RocreaUonalland (tho Planning Act) 61 735,466
Investment Income - from own funds 5 336,765
- other 8 359,399
- 9
- 10
- 11
- 12
Total revenue '13 9,600,879
expenditures
Transfarred to cepitol fund 14 3,047,617
Transforred to revenUe fund 15' 576,2
Ch"'lles for long torm Uabnitfes-princlpal and Intotest 16
- 83
- 2111
"§
TOQI --- 22 I 3 62S 6611
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Salanco ot the and of tho yoar for.
Reserves ZI 5,1122.~
Res"",e FtJods 24 14,224,6:Z¡
Total 25 20,041,25
Analysed as follows:
Resorvos and dlscredo..ry resorvo funds: '
Wor1<lng funds 2ð 400,OOC
Contingencies 21 1 ,227,66~
Ontario Claan Water Agoncy funds for renewals, etc,
-sewer 28
-wator 29
Replocement of equipment 30 1,829,610
Sick leave 31
Insurance 32 376,14E
Wo",e..' componsedon 33
Capilel,expandituro-<, eneral administration 301
...,ads 35
..enitary and storm sowers 36
-pe"", and r_oellon 64 773,463
-libl8ty 65
-other cultural ðð
-wetor 38
-trans it 39
-housing 40
-Industriei development 41
-other and unspecified 42 1,796,616
Wate_"", current purpo.es 49
Transn current purpooes 50
Ubrary current purpoo.. 51
Inventory S2 202,978
Rate Stabilization 53 1,766,23
- 54
Obligatory rosarvo funda:
Development Ch"'lles Act 88 5,674,29
Lot "wi.. and subdivider contributions 44
R8CnIsUona¡ land (tho Planning Ad) 48 5,776,228
Par1<ing revenues 45
Debenture repayment ' 41
Exchange rate stabilization 408
- 55
- 58
- 51
Total 54 20,047,256
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NOTES TO THE CONSOLIDATED FINANCIAL STATEJ.\tIENTS
AS AT DECEMBER 31. 1997
7.
Reserves and Reserve Funds
The total balances of reserves and reserve funds of $1,817,690 (1996 - $3,031,770) and
$12,254,548 (1996 - $13,637,677) respectively are made up of the following:
1997
1996
Reserves set aside for specific purposes by Council:
- For working capital $ 400,000 $ 400,000
- For self insurance 250,000 250,000
- For inventories 202,207 208,954
- For replacement of capital equipment 175,914 1,453,126
- For contingencies 705,669 635,790
- For reskilling and redeployment 83,900 83,900
Total Reserves $ 1,817,690 $ 3,031,770
Reserve funds set aside for specific purposes by Council:
- For recreation programs and facilities
- For acquisition of fIXed assets
1997 1996
$ 447,280 $ 1,404,317
1,500,294 2,526,230
1,947,574 3,930,547
Reserve funds set aside for specific purposes by
legislation, regulation or agreement:
- Development charges act
- For park purposes
6,145,652 5,016,146
4,161,322 4,690,984
10,306,974 9,707,130
$ 12,254,548 $ 13,637,677
Total Reserve Funds
66
9liIl"'(Yl) g¡'ett) ,J';,w!ail' r;?/wrlel<e(I.(cCQUlltCUlt..
j
CONTINUITY OF RESERVES
AND RESERVE FUNDS
forth. year ended December 31.1997
Municipality
r'----'piëkëï-illgT-¡
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10
J
15
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Balance at the beginning ot the year
Revenues
Contributions from revenue fund
Contributions from capital fund
Development Charges Act
Lot levies and subdivider contributions
Recreational land (the Planning Act)
Investment Income - from own funds
- other
---.-.
1 i
,~
2 509,81~
3, - - _.- ---.-¡
6T .. .. - 3,133,000'
60 --'--112.2321
611-- - '-28['2~
s: - ..--.. -140,'-18i
ei - -.- --670,9691
~ ------1
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1{ 5,721.71~
151 1,723,896
1(==- -1
63! I
20: - -------,
_. . ------~
21: i
2~ 7,445.61~
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Total revenue
j
Expenditures
Transferred to capital fund
Transferred to revenue fund
Charges for long term liabllities-principal and interest
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Total expenditure
Balance at the end 01 the year tor.
Reserves
Reserve Funds
._._._- -- ....
1,817,690,
-12.254.54&
14.072.23~
!
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26', 400,0001
j -- ""'1
2~-
3d - 175,91
¡...----
311 -' ---
3~ 250,00
3~-
3~"-'
35[-
361- I
6~ -------'
6s' - 447,281
66 - --- ----
38, -'---'--j
_.... ---- ._,
39
40
41
.. -----_.._1
42 1.500,294j
68 ~~_=!145:~~
4~ I
~ =:. ",..,
471'-
'-
~
49:
50;
I.
51'
i -.-
5Z 202,207
53; .. - - 83,90C
s4i .-....--.-
--~~ -~-~rn>,~
23
24
Total 2~
~
." ,
~
J
J
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Analysed as follows:
Working funds
Contingencies
Ontario Clean Water Agency funds for renewals, etc.
'sewer
-water
Replacement of equipment
Sick leave
Insurance
Workers' compensation
Capital expendlture-general administration
-roads
-sanitary and storm sewers
-parks and reaeatlon
-library
-other cultural
-water
-transit
-housing
-Industrial development
-other and unspecified
Development Charges Act
Lot levies and subdIvider contributions
Recreational land (the Planning Act)
Parking revenues
Debenture repayment
Exchange rate stabilization
WateIWorks current purposes
Transit current purposes
LIbrary current purposes
INVENTORY
RESKILLING AND REDEPLOYMENT
- ---- -
"'---'.-
£7.
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TOWN OF PICKERING
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
AS AT DECEMBER 31.1996
7.
Reserves and Reserve Funds
The total balances of reserves and reserve funds of $3,031,770 (1995 - $2,432,846) and
$13,637,677 (1995 - $12,239,758) respectively are made up of the following:
Reserves set aside for specific purposes by Council:
- For working capital
,. For self insurance
- For inventories
- For replacement of capital equipment
- For contingencies
- For reskilling and redevelopment
Reserve funds set aside for specific purposes by Council:
- For recreation programs and facilities
- For acquisition of fixed assets
Reserve funds set aside for specific purposes by
legislation, regulation or agreement:
- Development charges act
- For park purposes
Total reserve funds
I (~8
9'rurr<t!fl; Gfett', J'iruda¡,. (tlUt"'.,..,¡, t.xø_IrW*
1996
1995
$ 400,000 $ 400,000
250,000 250,000
208,954 214,207
1,453,126 613,639
635,790 460,000
83,900 495,000
$ 3,031,770 $ 2,432,846
1996 1995
$ 1,404,317 $ 2,089,572
2,526,230 2,896,961
3,930,547 4,986,533,
5,016,146 2,927,179
4,690,984 4,326,046
9,707,130 7,253,225
$ 13,637,677 $ 12,239,758
II
SCHEDULE 10
CONTINUITY OF RESERVES
AND ReseRVe FUNDS
For the arendln Dea31 1996
Ba ance 8t beg nnlng of year
Revenue.
Contrlbullon. from revenue tuncl
Contrtbutlon. from capital fund
Development Charg.. Act
Lotlevl.. and IUbdlvlder conlrbutlon.
Recreational land (the Planning Act)
Inve8lment Income-Irom own funda
-other
!
8'
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.
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.
Total revenue
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.
Expendllure.
Tr.na/erred to caplt., fund
Trana/erreclto revenue fund
Charge. lor long term lIabllitlea
-principal and Interest
,
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Total expenditure
Balance at end 01 year lor:
Reserves
Reserve lunda
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Total
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analysed aa lollowa:
Working lunda
ContIngencIes
OntarIo Clean Waler Agency funda lor renewals, etc
-sewer
-water
Replacement at equipment
Sick leave
Insurance
Workers' compensation
Capllalexpendllure-general administratIon
-roada
-sanitary and storm sewers
-park. and recreation
..Ubrary
-other cultural
-water
-Iransll
-housing
-Industrial development
-other and unspeç¡ned
Development Charges Act
Lot levies and subdlvlditr contributions
Recreational land (the Planning Act)
Parking revenue.
Debenture debt
Exchange rale stabilization
Waterworks currenl purposes
Transit currant purposes
Ubrsry current purposes
Inventory
Aeskllllng & Redeployment
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J
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Tolal
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16
63
20
21
22
23
24'
2S
26
'.IT
28
29
30,
31
32
33
34
38
36
64
65
66
38
39
40
41
42
68
44
46
415
47
48
49
50
51
152
53
54
155
56
57
58
" c',i,c: "i'lii¡;;~'(i;!ll:"~';:~f;~ '~,::i~i" ,
',',,"""""""", '"!-,,,," ","JlI,""'""",, , "" ""c','" '
,", ",w '" .w"'" ", " ,
TOWN OffPICKeRíN(r'-\i;::,"!~,
, , '" '" ,., :~i¡;;L:j;f~:::
2
3
87
60
81
15
6
9
10
11
12
13
,': '",' ~,,~ ,"
14
15
15
.. .
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3.94& 148 ,i
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1 4
126
215 . 000
317
2. 230
01 148
208,954
83 900
16,669 447
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.O~~ OF PIO~
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TOWN OF PICKERING
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SUMMARY OF RESERVES AND RESERVE FUND
1997
$
1996
$
1995
$
1994
$
Discretionarv Reserves
'1 Working FundsNacation Pay 841,350 841,350
- c-Replaœmertl-Qf-caPItaf"---- "- ~~--~---- -- ----"--
Ii Equipment 175,914 1,453,125
\ Contingencies 264,319 194,440
II Self Insurance/Inventories 452,207 458,954
¡ Reskilling 83,900 83,900
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Ii Reserve Funds
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III
,t Discretionary Reserve E.Y.!!9!
l Development Charges
If Parkland .
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Community Facilities
Capital Works
Public Works
TOTAL
Ii
1,817,690
3,031,769
830,000 830,000
613,639 1,954,973
30,000 115,811
464,206 443,197
495,000 315,000
2,432,845 3,658,981
447,280 1,404,317 2,089,572 5,072,924
403,758 1,342,783 1,494,642 1,421,174
1,096,536 1 ,183,448 1,402,319 1,295,819
1,947,574 3,930,548 4,986,533 7,789,917
6,145,652
4,161,322
10,306,974
14,072,238
76
5,016,146
4,690,984
9,707,130
16,669,447
2,927,179
4,326,047
7,253,226
2,599,842
4,016,980
6,616,822
14,672,604
18,065,720
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RESERVES & RESERVE FUNDS
1995 -- 2000 (EST.)
~-::;'
,-. '.
.- .
$2, 000, 000
$0
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1995 1996 1997 1998 19992000
71
-- '--
+-- "--"--- ---- -_._~----~- _._- ----"---.-.- ---'--"- -----, "--- -----
2001 Budget Overvieh
Cily of Pickering April 2, 2001
2-.811' C.ur-re'nt & Capital Budgets
Res1erves & Reserve Fu nds
$25,000,000
$20,000,000
-;;;;:;J-
NI - $15,000,000
$10,000,000
$5,OO.O,Oï8~8
~~ -.~
1 '.1 1":2 19 9 4 19:9'6 l"" 21110
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REPORT TO CO
FROM:
Gillis A. Paterson
Director, Corporate S~rvices & Treasurer
DATE: November 10,1999
REPORT NUMBER: FIN 17/99
SUBJECT:
Development Charges Reserve Fund Statement for Town of Pickering
Services for 1997 and 1998
RECOIvIMENDATION:
I
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That Report FIN 17/99 and the Statement of the Director, Corporate Services & Treasurer
respecting the Development Charges Fund (G/L 4227) be received by Council.
¡
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ORlGJN:
Director, Corporate Services & Treasurer
I.
AUTHORITY:
Development Charges Act, R.S.O. 1990 as amended.
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FINANCIAL Th1PLICATIONS:
There ãre no financial implications to the receIpt of this statement.-
...,.
EXECUTIVE SUMMARY:
Not Applicable
\
..
BACKGROUND:
...
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Section. 17 of the Development Charges Act requires that the Treasurer furnish to Council a
Statement in respect of each Reserve Fund established under Section 16 (ie. for each
Development Charge). Statements are attached to this Report covering. the last two fiscal years,
1997 and 1998.
While total development charges collected decreased by $264,536 ITom $3,133,000 in 1997 to
$2,868,464 in 1998, the amount expended on capital projects also decreased by $185,178 ITom
$2,015,405 in 1997 to $1,830,227 in 1998.
Loan repayments of $1,275,533 in 1998 reflect internal transfers to various other Reserve Funds
to repay amounts borrowed tointerim.finance the construction of Fire and Indoor Recreational
. 73
Report to Colmcil FIN" 17/99
Date: November 10, 1999
. Subject: Development Charges Reserve Fund Statement for Town
of Pickering Services for 1997 and 1998
Page 2
Facilities in past years. Interest income and the repayment of oversizing costs make up the
difference. The end result was an increase in available balances over the two year period of
$858,147 to $5,874,29.
ATTACHMÈNTS:
1.
2.
1997 Statement of Development Charges Reserve Fund
1997 Analysis of Activities Respecting Transfer to Capital Projects
1998 Statement of Activities Respecting Transfer to Capital Projects
1998 Analysis of Activities Respecting Transfer to Capital Projects
3. ,
4.
Prepared By.
Approved / Endorsed By:
~~-
&inson,
Deputy Treasurer
~~
<...---
G.A. Paterson,
Director, Corporate Services & Treasurer
JAT:vw
Attachments
\'
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Recommended for the consideration of
Pickering Town Council
}.. --..--..-...--.---. .'-.-- -- ~ .-
¡ Thomas J. Quinn, Chief Administrative Officer
.-.-.----.-------.-...-..---........-.--.---.---.--...""'--'-.. . .
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ANNUAL STATEMENT OF DEVELOPMENT CHARGES RESERVE FUND
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I Balance
!
Dec. 31/96
¡ $
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,-",-
'-,
-.: -,H_-
FOR THE YEAR ENDED DECEMBER 31, 1997
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verslzmg recovenes represent recuperatIon 0 costs .lor temporary over capacIty at t Ie lune 0 cons ruc Ion
,
ofthe ~unici~a~ Office an~ Central Librart as identifi~d in , the Dev,elopment Charge~ Study of 1991. .
The fundmg, ongmally proVIded by other reServe funds IS bemg repaid now that sufficIent balances are avaIlable.
I '
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Description
-J
c:.n
Town Offices
Capital Growth Studies
Fire Facilities
Fire Vehicles & Equipment
Stonn Drainage & Roads
Works Yard, Vehicles & Equipment
Transit
Parkland Acquisition
Parkland Development
Major Indoor Recreational
Library Facilities
Library Materials
392,406
211,386
75,788
304,696
477,447
507,754
(16,363)
796,669
1,249,043
660,775
238,782
117.763
5.O16.l46
*
///
/
Developmen t
- Charges
Collected
1997
$
269,347
72,913
66,153
110,117
676,738
146,444
36,880
284,062
588,116
617,775
164,014
100.441
3.133.000
Interest
Allocated
$
25,155
16,312
8,570
22,318
24,434
37,638
252
56,124
43,863
77,420
145
7.422
~3.
Oversizing
Recoveries *
$
(189,228)
(118,514)
---
£3QZ.1421
Amounts
Transferred
To Capital
Projects 1997
$
(665,915)
(83,606)
(914,547)
(276,097)
05.240)
(2.015.405)
-'~
Balance
Dee. 31/97
$
497,680
300,611
150,511
437,131
512,704
691,836
20,769
1,053,249
966,475
1,355,970
8,330
150.386
6.l45.652
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ATTACHMENT #...2- TO REPOR.T#..fu:!..Ll h.9
ANALYSIS OF AMOUNTS TRANSFERRED to 1997 CAPITAL PROJECTS
. FROM DEVELOPMENT CHARGE RESERVE FUND
;
i
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Roads (External Subdivision Works)
Rosebank Road (l8T-88074)
Woodview Avenue (18T-87066)
Fairport Urbanization
Kingston Road Trunk Storm Sewer (yV6)
FiJ;1ch Avenue Street Lights (18T-93020)
Finch Avenue Sidewalk (18T-89028)
Dixie Road Urbanization (18T-89077)
i
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I
Parkland Acquisition
Prepaid acquisition netted from 'Charge'
I
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Parkland Development
Prepaid development netted ITom 'Charge'
Trail/Bikeway Development
Southcott Pines Park
Princess of Wales Park
,..
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Librarv Facilities
Western Branch
$ 392,759
215,090
29,959
3,933
4,047
1,267
18.860
$665,915
83,606
$153,147
113,400
162,000
486.000
914,547
276,097
Library Materials
Collection Materials 75.240
$2.015.405
I . ..... ... .. ... ... ........ .... ........... .'
<-:::.:_- --.--.--.---..--..-.--..----------.--- -_._.~ '-, ",=,",..""" ",.=~, "'.-'-'------- - ---...--------.-.--- ----..-. '--"-"----"'-' ..
.f:
76
'.
'-...e
Description
G.,J
""-J
Town Offices
Capital Growth Studies
Fire Facilities
Fire Vehicles & Equipment
Stonn Drainage & Roads
Works Yard, Vehicles & Equipment
Transit
Parkland Acquisition
Parkland Development
Major hldoor Recreational
Library Facilities
Library Materials
"""'--~...
~--- .
.-.~-.--
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!
~NUAL STATEMENT OF DEVELOPMENT CHARGES RESERVE FUND
I
I Development
¡i Charges
Collected
i -»98
i $
j
¡
497,680 ¡
300,611 !.
150,511 I
437,131 ¡
512,704 I
691,836 ¡
20,769 ¡
1,053,249 '.
I.
966,475 ¡:
1,355,970 ii
. 8,330 I:
150.386 I;
6JA5.652 ¡i
Balance
Dec. .J.!L21
$
246,421
55,409
60,816
101,210
630,21 I
134,090
33,801
259,944
538,838
565,598
149,984
92.144
2..8..6.&.464
FOR THE YEAR ENDED DECEMBER 31, 1998
Interest Oversizing
Allocated Recoveries *
$ $
Amonnts
Transferred
To Capital
Projects 1998
$
25,408 (235,902)
15,288 (50,000)
11,124
27,807
5,635 (963,204)
42,447
3,051
63,699 (71,262)
41,312 (652,613)
101,283
803 (143,442)
7,424 (93.148)
345.281 079.344) (1.830.227)
t'
~ . .
* Oversizing recoveries represent recuperation of cos~~ for temporary over capacity at the time of COll!itruction
of the Municipal Office and Central Library as id~p.tified in the Development Charges Study of 1991.
The funding, originally provided by other reserve 1ds is being repaid now that sufficient balances are available. .
Ii
** Loan repayments are the return of the interim financi.ng provided by other Reserve Funds to facilitate the early
construction of various capital projects in the specifibd categories.
;
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Loan
Repavments**
$
(200,780)
(1,074,753)
(1.275.533)
Balance
Dee. 31/98
$
533,607
321,308
21,671
566,148
185,346
868,373
57,622
1,305,630
894,012
948,098
15,675
156.803
5.814.293
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ATTACHMENT#L. TO REPORT#tl!Lnh~
ANALYSIS OF AMOUNTS TRANSFERRED -1998 CAPITAL PROJECTS
FROM DEVELOPMENT CHARGE RESERVE FUND
i
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Capital Growth Studies
Development Charges Study Update
$ 50,000
I
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Roads <External Subdivision Works)
Rosebank Road (18T -88074)
Woodview Avenue (18T-87066)
Waterford Gate Extension (40M-1629)
Brock Road (l8T-87079)
Hillview and Park Cres. (18T-89280)
Dixie Road Urbanization (18T -89077)
Old Orchard (18T -84032)
Rosebank Road (18T-93020)
Finch Avenue (18T-93020)
Kingston Road (S2/94)
Altona Road (S2/94)
Liverpool Road (18T-89081)
Finch Avenue (18T-89081)
Sputhview Drive (87/95)
Altona Road (18T-86002)
Bonita Avenue (18T-94022)
Strouds Lane (18T-96009)
Whisky Gate (18T -87059)
$174,697
14,856
4,900
52,500
1,400
181,124
58,800
21,640
17,290
35,560
22,190
19,591
21,560
68,396
42,000
90,200
122,500
14.000
963,204
,..."..--.
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Parkland Acquisition
Prepaid acquisition netted ITom 'Charge'
71,262
Parkland Development .
¡.. .. , "'" ""'" ._..,...^._._._--_._.;:~~~~~~~::~~;;~t-netted,fr0m-~Gharge!......._.."," " '~""""=-$~l~:::¡~=,,~.,"
Pinegrove NeighbourhoodPark 162,000
Front Street Park 81,000
Rosebank North Neighbourhood Park 20,250
Trai.1fBikeway Development 243.000
. .
... .."..... .... .......... .. "..... .." "'.. .
.-............---...-....-..-..................---..----....-..- ----"-"..
652,613
Librarv Facilities
Collection Materials
93.148
$1.830.227
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FROM:
Gillis A. Paterson
Director of Finance
, ,
DATE: April 7, 1998
REPORT NUMBER: TR 13/98
SUBJECT:
Management of Reserves and Reserve Funds. '
RECOMMENDATION:
It is recommended that this Report No. TR. 13/98 be received by Council for
information.
"ORiGIN: "
, 'Reþõftìš'süedõYHiìff~ñ, 'Flëtt,'Siriê1ãìi, 'Chãrieiëci'Ãcèõüžitän:iS,Town 'Auditor,
in the summer of 1996, on reserve activities of the Town for the year 1995;
Auditor suggested that the Treasurer (Director of Finance) 3lld Council review the
reserves and reserve funds more frequently. '
, AUTHOlUTY:
Sections 162 an~ 163 of The Municipal Act and Ontario Regulation 43,8/97.
FINANCIAL IMPLICATIONS:
Not applicable.'
EXECUTIVE SUMMARY:
This report contains a summary of legislative requirements and staff comments
' ," regarding, theestabIishtnent- and management of reserves' and 'reservefuncis;'" ,
""'" " "','
BACKGROUND:
See also Report for "Pre Audit Actuals, as at December 3~, 1997", of reserves and ' ':"
reserve funds.
""- '-..
, .
, ,
Reserves and reserve funds have designated purposes and are created through the sPet?Ïñc ' " . , ",:' :"
auUl0rization of Council for its own purposes ör as prescribed by Provincia11egislation.
"
(1)
Legislation Authority
(a)
,," ,':'.: ',/~:::,:,'I:}~~;,~\,:~;:':'i¡,~~,::. ::':'::
" ~;,.;;,;:Ji:jL:':~,
The authorization for the ~tion or establishment' of a rese~e in' a '<C. :~~'\:?~>::¡, :~
Municipality is governed by Section 162.(2) of the Municipal Act which"
states in part that "In preparing the estimates, the Council shall make due'
allowance for a surplus qf any previous year that will be available during
the current year and shal! provide for any op~ting deficit of any previous
. year... and for such r~erves as the council considers necessary."
, ,
Reserves
'7'9
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.",1/
Report to Council TR 13/98
April 7, 1998
Subject:
Management of Reserves and Reserve Funds (Cont'd.,)
Page 2
(1)
Legislative Authority (Cont'd.,)
(b)
.Reserve Funds
Section 163.(2) of the Municipal Act provides that "Every municipality,
local board and other entity may in each year provide in its estimates for
the establishment or maintenance. of a reserve fund for any purpose for
which it has authority to expend funds."
i
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I
Regulation 438/97 made under the Municipal Act RS.O. 1990 re9..uk~~_~,~-~~,
ÏiÏòhìëi(fäisëdTöf'ä -rës'ervê 1\iña'sfïãllbeqUïveSted'iñ ã securitY tor :;';:'hich the bond"
debenture, promissory note, or evidence of indebtedness are rated at a'prescribed
level' by one of four recognized bond rating agencies set out in the Regulation.
All earnings derived from such investments are to form part of the reserve fund.
Section 163.(5) ofthe Municipal Act requires the auditor in the annual report to
report on the activities and position of each reserve fund established by the
municipality. ,
"
!
(2)
Ministry Guidelincs
(,
Currently, there are no formal poliCies governing the establishment ánd use of
reserves and reserve funds by the' Province or the Corporation.' However. the
Director of Finance undertakes an annual review and maintains an ongoing
management of all reserves and reserye funds. Moreover, the Corporation must
follow certain Provincia! requirements in the reporting of these accounts
according to the Ministry of Muuicipal Affairs and Housing, as a guide for the use
of reserves and reserve funds or special funds. According to these guidelines, a
reserve is created by:
'--'------,- ._'_._.~,- "--"
._-, .. . "" - - ""-"-"'-'-- -.- a) iñcluding in the current e~at~s the amount that is to be designated as
reserves during the fiscal year. The authority for the creation of a reserve will
be contained in the estimates by-law of the municipality; or
b) transferring unexpected funds that have been identified prior to' the end of the
fiscal year to a reserve account In this instance an amending by-law would be
required prior to the end of the fiscal year to segregate a specified amount
from the avwlable operating revenues. '
These guidelines also apply to reserve funds. A reserve fund differs from a
reserve in that reserve fund assets are segregated and restricted to meet the
purpose of the reserve fUnd. Moreover, a reserve is frequently used in cönnection
with shorter term expenditures or those of a more operational nature such as .
vehicle replacemenL Reserve funds are typically associated with longer term
fmancing plans and expenditures, generally of a capital nature. There are two
types of reserve funds:
a) ObliŒatory reserve funds, '
'. .,:~~'iqi~~;i~;,;~:-j~'
Obligatory reserve funds are governed by legislation, regulation or agreement
and require revenue received for the special purposes to be segregated from
the general revel1ue$ of the municipality,
80
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"":';':;;:;:)\:;':;\'::~;i:
, Report to Council TR 13/98
April 7, 1998
Subject:
Management of Reserves and Reserve Funds (Cont'd.,)
Page 3
(2)
Ministry Guidelines
a) Obligatory Reserve Funds (Cont'd.,)
Obligatory reserve funds must be created whenever a statute reqUires revenue
received for a special purpose to be segregated :trom the general revenues of
the municipality and are to be used soleLy for the purpose prescribed for them
by Statute.
I
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b) Discretionary Reserve Funds
Discretionary reserve funds are established whenever a municipal council
B'ishes..,to"e.armarkrevenues-tofinance,aJuture expenditure, for-which itha.s ,the
authority to spend money and physically set aside a cert,aÏn portion of any
year's revenue so that the funds are available as required. In accordance with
Section 163 of the Municipal Act, Discretionary reserve fllnds may be used
for a number of different purposes. Some' examples of these are:
I. future expenditures for land acquiSition;
II. new buildings and other capital projects;
III. vehicle self insurance; and
IV. industrial promotion.
WIth the exception of "Obligatory Reserve Funds," the use of reserves and,
reserye funds are at the discretion of Council. Generally, reserves are used to
provide for equipment replacements and payments of specific expenses which
could cause major budgetary fluctuations. Reserve funds are used if Council
wishes to earmark funds in a more fomuil way and to set aside funds ftom the
general operations oithe municipality, '
1
I.., --------...-.-.. -,---
, Since municipalities are legally prohibited from operating their general or ,
--..- -, ---r-e¥er:J.ue-funds-at--a-de-fiGit,resel'Ves-and-reserve-funds-also--rnay-provide-a-way-- - - - ~------, , .
, or leveling unanlicipaled or eXlraordInary expenditures between periods or
putting away funds for future use. The future USe mayor may not be'
specifically designated such as in the case of a reserve for working funds.
In theory, each fund is a separate group of accounts created as the result of '
legal or regulatory, requirements, by conti-a.ct with donors or grantors, or
voluntarily by the direction of Council.
A reserve fund'is usually created to record the resource flows associated with
a special project or event or to institute a new program, using a special ,grant
from a donor or a government grantor. Revenue may, be generated by the fund
or may be financed by restricted giants from outsid~ the organization.
,0" "\";";"";;"""';~;~'<~;';'~\!';'~<;;",,:
Conclusion' "~;'¡"'\""o.;,;.,,::~;~!t,,-,~;~,~,',>-.,;itl,'~~,;',l~,-,,¡'!-",:'~":: ..':,,"'"," . ,~,,'i ",-:, """"\"'~:"""":'~'~ij:¡.¡.:¡¡r~,'!;.~,,~;,:,~ '
. '" - .. .' "'.' -:' ';~'<","'¡~I;r"""-;';'¡;:~'~~~;! i.
Reserves and reserve funds form an integral part of sound financial management and" .. "!<""", """,'. '
planning whereby revenue in one period can be put aside to accumulate and finance p14tmed
expenditures in a future period. Reserves and reserve funds provide liquidity to the
Corporation and are one of the key indicators of the financial health of the municipality.
"'.
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Report to Council TR 13/98'
April 7, 1998
Subject:
Managen:ent of Reserves and Reserve Funds (Cont'd.,).
Page 4.
¡.
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ATTACHMENTS:
(1)
A copy ofP.28 (Extract) iÌom the Auditors Report issued to
Council on the Summer of 1996 on reserve/reserve fund activities
for the year 1995.
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Prepared By:
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- Gillis A. Paterson
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Copy: General' Manager
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"EXTRACT" FROM THE AUDITORS REPORT ISSUED :fO COUNCIL IN THE SI.J1vIMER
OF 1996 ON RESERVE/RESERVE FUND ACTIVITIES FOR THE TOWN FOR THE YEAR 1995.
- 28 - ATTAè:HMENT#-:-LTO~~ ..::J.i3/98
RECOMMENDATIONS RELATED TO RESERVE
AND RESERVE FUND MANAGEMENT
The following recommendations relate the management of the Town of Pickering reserve
and reserve funds.
1. Periodic Review of Reserves
Through this process, it is our observation that reserves and reserve funds are not fully
understood by Council. Although it is hoped that this material has been educational, we suggest
that ilie treasurer and council review these reserve and reserve funds on a quarterly or semi-
annual basis.
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In doing so, Council can'become more familiar with the reserves and reserve funds, the
transaction that affect those accounts and their inter-action with the municipality as a whole.
The result will be enhanced governance of the reserve and reserve funds. This will ensure that
a reserve on reserve fund is not used.
2. Format of Treasurer's Reuort To Council on Reserve and Reserve Fund Activity
The report that is currently produced by the Treasurer presents the revenues and'
expenditures of these twelv~ accounts as bulk totals. ~cCo~~r.j~:ÍS._!!Q!-~~~@YA,~~ur.jlli!ble___,_..,------,-
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, what tr:ansactions speciflcallyaffected what reserve or reserve fund account. The implication
,is that Council can not see for themselves why a particular reserve or reserve fund increased,
decreased or remained the same. The restructuring of this 'report, in- conjunction with the first
recommendation will produce very positive results.
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THE CITY OF PICKERING
SUMMARY OF RESERVE & RESERVE FUNDS
1995 1996 1997 1998 1999 2000
Reserves set aside for specific purposes by Council:
Allocated
Working CapitalNacation Pay 830,000 841,350 841,350 841,350 841,350 841,350
Replacement of Capital Equipment 613,639 1,399,231 43,624 1,592,358 2,179,592 1,706,640
Contingencies 30,000 194.440 264,319 786,318 1,381,295 1,371,295
Reskilling & Redevelopment 495,000 83,900 83,900
Rate Stabilization - 1,786,232 2,981,232 249,139
1,968,639 2,518,921 1,233,193 5,006,258 7,383.469 4,168.424
Man d a tOry IRe s tri cted/LeQ isla ted
Self Insurance/lnventories 464,207 458,954 452,207 579,124 713,080 776.410
City's Portion Development Charges - - - 1,889,000
00 ~ Replacement of Capital Equipment
~ - Rink/Pool/Arena Surcharge 53,895 132,290 237,252 342,214 447,176
464,207 512,849 584.497 816,376 1,055,294 3,112,586
Total 2.432,846 3,031,770 1,817,690 5,822,634 8,438,763 7,281,010
Reserve funds set aside for specific purposes by Council:
Recreation Programs - Comm Fac. 2,089,572 1,404,317 447,280 773.483 219,209 282,569
Acquisition of Fixed Assets
- Capital Works Projects 1,494,642 1,342,783 403,758 613.464 826,082 850,629
- Public Works Services 1.402,319 1,183.447 1,096,536 1,185,154 1,194,655 1,304.410
4,986,533 3,930,547 1,947,574 2,572,101 2,239,946 2,437,608
Reserve funds set aside for specific purposes by Legislation,
Regulation or Agreement:
Ma ndatory IRes tricted/L eQi slated
Development Charges Act 2,927,179 5,016,146 6,145,652 5,874,293 6,744,603 7,586,551
Park Purposes 4,326,046 4,690,984 4,161,322 5,778,228 4,242,340 3,875,813
Pickering Baseball Association - - - 60,789
7,253,225 9,707,130 10,306,974 11,652,521 10,986,943 11,523,153
12,239,758 13,637,677 12,254,548 14,224,622 13,226.889 13,960,761
City of Pickering
OOresresfnd.xl
CITY OF PICKERING
COMPOSITION & DISPOSITION OF 2000 SURPLUS
(Preliminary and Unaudited)
$
Supplementary Taxes
328,000
Investment Income
718,000
Interest & Penalty Revenue
406,000
Payment in Lieu of Taxes:
Linear Properties
Duffin Creek Water
Ontario Hydro Supplementary
359,000
370,000
688,000
OMERs Savings
564,000
Confederation Life
220,000
3,653,000
Net Underexpenditure for Departmental and
Non-departmental Items
(13,000)
3,640,000
Comm Facility Reserve Fund - Financing of
2000 Capital Projects
(1,860,000)
Tax Write-offs
Surplus
(181,000)
(110,000)
Transfer to City's Portion Development Charges (1)
(1,489,000)
(1) The 1999 Development Charges Study stated that Pickering needed to
provide a contribution of $2.4 million per year for ten years. This contribution
is required to fund the City's share of Development Charge projects. In the
2000 Current Budget, only $400,000 was provided for the City's annual
contribution. Therefore as a result of the above transfer, the City is only
$511,000 short of its annual contribution.
City of Pickering
OOhighlights.xls 5/18/01
85
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Supplementary Taxes
Linear Properties (mid year ruling)
Works Insp., Bus. Permìts etc.
Building Penmäs G ¡). C. Act)
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Investment Income
- Recovery from Province
Penalties and Interest on Taxes
OMERS Savings
Transit Revenue
Supp. Assessment Fee Accrual
Department Underexpenditure
Revenue Increase
Retro Pay
Transfer to Conüngency Reserve
Year E!!}c¡ ! Accl!IiJa!/is
Surplus
Transfer to Rate Stabilj,zaiioo
86
$
220,000
94,000
115,000
362,000
312,000
205,000
413,000
1,721,000
300,000
260,000
600,000
2,881,000
342,000
3,290,000
(1,150,000)
(325,000)
(165,000)
1,650,000
(110,000)
(1,540,000)
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