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HomeMy WebLinkAboutCS 33-05PICKERING REPORT TO EXECUTIVE COMMMITTEE Report Number: CS 33-05 Date: May 3, 2005 From: Gillis A. Paterson Director, Corporate Services & Treasurer Subject: 2004 Pre-Audit Balances of Reserves and Reserve Funds Recommendation: 1. It is recommended that Report CS 33-05 of the Director, Corporate Services & Treasurer be received and forwarded to Council for information. Executive Summary: Based on the preliminary 2004 results, we can now report on the pre-audit actual activities within the Reserves and Reserve Funds for 2004. A summary is presented in Appendix A. The purpose and 2004 financial transactions for each Reserve and Reserve Fund are set out in Appendices B and C respectively. Financial Implications: Not applicable Background: As in previous reports filed over the last four years, this report provides specific information on each of the City's Reserves and Reserve Funds, including year-end balances. The 2004 pre-audit Reserves and Reserve Funds balance of $42,665,007 is one of the highest balances ever reported in Pickering. However, this balance is not fully available for use due to the outstanding commitment of funds not yet spent, the obligations connected with the collection of funds or other specific purposes approved by Council or under Provincial Legislation. With regards to unspent commitments for capital projects, we are continuing the practice of not transferring funding for commitments until the expenditures are incurred. This procedure allows the Reserve Funds to earn interest income as long as funds are still in the reserve fund's custody and is in compliance with PSAB for obligatory Reserve Funds. The combined unspent commitments for all Reserve Funds are $3,116,066. From 2001 to 2003, the City's share of collections from OPG related to properties under assessment appeal were $6,555,478. In 2004 an additional amount of $2,179,648 was collected followed by a repayment of $1,029,886 due to settlement for a portion of the Report CS 33-05 Date: May 3, 2005 Subject: 2004 Pre-Audit Balances of Reserves and Reserve Funds Page 2 collections, bringing the December 31, 2004 value to $7,705,240 in the OPG Contingency Reserve pending final decision of this appeal. At this time, we are still unable to confirm the availability of these monies for corporate purposes. In the meantime, these funds are being used for the temporary financing of the Don Beer Arena expansion with the balance being invested. The Development Charges, Parkland, Third Party/Developer Contributions, Ontario Transit Renewal and Provincial Dedicated Gas Tax Reserve Funds represents funds received for specific purposes subject to legislative requirements and based on developer agreements or agreements with any third parties. Funds available in these Reserve Funds are obligatory in nature and should be treated as committed. The balance in these obligatory Reserve Funds is $23,440,099. The combined total of the unspent commitments, OPG assessment appeal, other committed balances and obligatory Reserve Funds of approximately $37 million reduced the "discretionary" balance to approximately $5.6 million as at December 31,2004. The City established a new reserve and reserve fund this year, namely: Vehicle Replacement Reserve and Provincial Dedicated Gas Tax Reserve Fund. The purpose of the reserve and reserve fund is discussed further in Appendix C. Internal borrowings from the Reserve Funds commenced in 2001, to assist in funding capital projects. Although the amount borrowed each year has declined, the outstanding principal balance at December 31, 2004 is approximately $6.4 million borrowed from the Development Charges and Parkland Reserve Funds. This provided the Reserve Funds with an attractive rate of interest compared to current market investment rates while at the same time providing a cheaper cost of borrowing to the capital fund. Interest earned on internal loans represents amounts earned on the 2001 to 2003 internal borrowings. Repayment for 2004 internal borrowings will commence in 2005 and interest earned will be reflected accordingly. Attachments: 1. Appendix A 2. Appendix B 3. Appendix C Summary of Reserves and Reserve Funds Description of Reserves Description of Reserve Funds Report CS 33-05 Subject: 2004 Pre-Audit Balances of Reserves and Reserve Funds Date: May 3,2005 Page 3 Prepared By: Approved / Endorsed By: Caryn Kong Senior Financial Analyst Gillis A. Paterson Director, Corporate Services & Treasurer GAP:vw Attachments Copy: Chief Administrative Officer Recommended for the consideration of Pickering City.C. euncil , Th~ ~. euinn~hief Edminis~ffZer Appendix B 4610 4611/4623 4612 4613 4619 462O 4621 4622 4624 APPENDIX A CITY OF PICKERING SUMMARY OF RESERVE AND RESERVE FUND PRE-AUDIT ACTUALS DECEMBER 31, 2004 Summary Reserves Pre Audit Audited Audited Audited 2004 2003 2002 2001 Working Funds Replacement Capital Contingencies (2) Self-Insurance (2) Rate Stabilization Develop. Charges-City's Share (2) Region Transit (2) Continuing Studies (2) Vehicle Replacement-New Total Reserves 400,000 400,000 400,000 400,000 758,175 730,713 615,800 1,083,837 9,053,320 7,813,558 6,791,047 5,277,795 940,514 940,514 949,106 972,489 2,619,565 2,177,209 2,421,909 2,104,410 1,921,332 2,685,297 2,812,214 2,765,000 1,025,741 1,106,634 1,242,507 233,159 141,884 67,400 25,000 - 16,976,806 15,995,809 15,299,983 12,603,531 Appendix C 4225 4227/9 4228 4230 4232 4233 4234 4235 4236 4237 4238 Summary of Reserve Funds Community Facilities Development Charges (1) (2) Capital Works Parkland (1) (2) Public Works Pickering Baseball Assoc (dosed) Workers Safety Insurance Brd (2) Third Party/Dev. Contributions (t) Ontario Transit Renewal ¢) Squash Courts (2) Prov. Dedicated Gas Tax (1)(new) Total Reserve Funds Total Reserves & Reserve Funds Pre Audit Audited Audited Audited 2004 2003 2002 2001 380,604 386,726 352,423 19,496,777 15,804,668 12,866,749 302,610 535,849 516,013 2,166,696 1,959,087 2,017,875 1,152,444 1,465,425 1,400,169 378,731 181,023 176,974 1,601,076 1,024,691 - 14,035 14,957 402,939 33,713 7,450 - 161,515 69,102 10,393,615 499,540 2,622,150 1,365,285 1,228 7,232 25,688,201 21,379,876 17,733,142 14,958,152 42,665,007 37,375,685 33,033,125 27,561,683 Notes (1) Obligatory (2) Committed Total Obligatory (1) & Committed (2) = $37,026,609 CS33ck Appendix A.xls APPENDIX B RESERVE FOR WORKING FUNDS 4610 Actual Balance December 31, 2003 Transfers into the Reserve Transfers out of the Reserve Pre Audit Actual Balance December 31, 2004 $ 400,000 $ 400,000 Purpose of this Reserve: The reserve for working funds is used to provide operating cash to assist in avoiding short term interest expenses incurred on operations, typically during the first months of the year prior to tax billing and at other times when cash inflows and outflows do not match as occurs in any corporation. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of the Reserve: It is recommended as a "rule-of-thumb" that this reserve be 2% to 3% of total City revenues. APPENDIX B RESERVE FOR REPLACEMENT OF CAPITAL EQUIPMENT - G/L 4611/4623 Actual Balance December 31, 2003 Transfers into the Reserve Revenue Fund Contribution Transers out of the Reserve Transfer to Capital Fund - Operation Centre Pre-Audit Actual Balance December 31, 2004 $ 730,713 115,462 (88,0oo) $ 758,175 w Purpose of this Reserve: The purpose of this reserve is to reduce the need to levy for the full cost of major equipment in the year of acquisition. The reserve acts as a stabilization factor and helps to avoid both tax rate fluctuations and the issuance of long term debt or other means of financing. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of this Reserve: This reserve should be kept at a level that is equivalent to the replacement cost of the assets for which they were established. Over the last couple of years, the reserve balance has been kept at a minimum level. Contributions to this Reserve are provided for annually in the Current Budget. In 2003, additional sub-categories were set up for accounting purposes to better match the collection of funds to the application of these funds to particular facilities as shown on the following page. APPENDIX B The balances pertaining to these sub-categories are as follows: REPLACEMENT OF CAPITAL EQUIPMENT - SUB CATEGORIES General Recreation Dunbarton Don Beer Rec Comp Rec Comp Rec Comp Corp Use Prgrms Pool Arena Core Pool Arena $ $ $ $ $ $ Total $ Dec 31/03 172,653 111,260 24,810 32,500 35,893 121,312 232,285 730,713 Transfer in 18,500 4,962 30,000 27,000 15,000 20,000 115,462 Transfer out (88,000) - (88,000) Dec 31/04 84,653 129,760 29,772 62,500 62,893 136,312 252,285 758,175 APPENDIX B RESERVE FOR CONTINGENCIES - G/L 4612 Actual Balance December 31, 2003 Transfers into the Reserve Revenue re OPG Assmt. Appeal Properties Transfer from Revenue Fund Transfers out of the Reserve Settlement OPG Assessment Appeals Transfer to Revenue Fund - Election Pre-Audit Actual Balance December 31, 2004 $ 7,813,558 2,179,648 90,000 2,269,648 $ (1,029,886) 0 (1,029,886) $ 9,053,320 Purpose of this Reserve: Like the capital equipment replacement reserve, this reserve acts in a tax stabilization capacity. It was established in anticipation of unknown, unusual or extraordinary expenditures which occur from time to time. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of this Reserve: In 2003, the large balances in this Reserve were reviewed and grouped into sub- categories in the General Ledger, for accounting purposes only, to better distinguish those amounts that are committed and those amounts available for general corporate use. The sub-categories are as follows: OPG Assessment Appeal, Elections, Other Assessment Appeals and Miscellaneous. The transfer regarding Ontario Power Generation (OPG) in the amount of $2,179,648 for the current year is the City's revenue for properties currently under assessment appeal. This amount plus the last three years' contributions of $6,555,478 less settlement in the amount of $1,029,886 in 2004 result in a combined total of $7,705,240. The availability of these funds is undeterminable as the appeal is still outstanding and is considered committed in the event repayment must be made. The amounts pertaining to the other sub-categories are as follows: Election - $90,000; Other Assessment Appeals - $682,594 and Miscellaneous - $575,486. APPENDIX B RESERVE FOR SELF INSURANCE - G/L 4613 Actual Balance December 31, 2003 Transfers into the Reserve Transfers out of the Reserve Transfer to Capital 940,514 Pre-Audit Actual Balance December 31, 2004 940,514 Purpose of this Reserve: This reserve was established as a necessary form of asset protection. Specifically, it is to cover insurance claims resulting from the increase in deductible levels, costs of uninsured claims and other claim related costs. The higher deductible reduced insurance premiums. Significant savings can be realized through reduced premium costs and staff analyze the costs/benefits of such actions on an annual basis. The interest income on these funds form part of the annual Current Budget General Government Revenue. m Recommended Maintenance Levels of this Reserve: This reserve should be maintained at a level to ensure that the funding is adequate to meet future liabilities. This situation is analyzed by staff on a regular basis. APPENDIX B RESERVE FOR RATE STABILIZATION - G/L 4619 Actual Balance December 31, 2003 Transfers into the Reserve Excess Surplus Contribution Transfers out of the Reserve 2004 Current Budget Provision Pre-Audit Actual Balance December 31, 2004 $ 2,177,209 1,607,300 (1,164,944) $ 2,619,565 Purpose of this Reserve: The purpose of this reserve is to act as a tax rate stabilization factor for annual current budget funding. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of this Reserve: The fund balance should be maintained at a level of 3 to 5 per cent of tax revenues to provide tax rate stabilization for annual current budgeting purposes. The 2004 Current Budget provided for a transfer in the amount of $1,164,944 from this Reserve to fund current expenditures. The 2004 operating surplus of $1,607,300 has been transferred to this reserve, resulting in a pre-audit balance of $2,619,565. APPENDIX B RESERVE FOR DEVELOPMENT CHARGES - CITY SHARE G/L 4620 Actual Balance December 31, 2003 Transfers into the Reserve 2004 Current Budget Provision Transfers out of the Reserve Transfer to Capital Fund External Subdivision Works Pre-Audit Actual Balance December 31, 2004 $ 2,685,297 1,000,000 (1,763,965) $ 1,921,332 Purpose of this Reserve: This reserve has been established to set aside funds for projected growth in the City. From the 1999 and the 2004 Development Charges Studies it was approved that a Reserve be established for the City's share (i.e. the non- development charge portion) of the costs of services included in the Development Charges Study and that contributions be included in the annual Current Budget for consideration by Council. For the City to meet its obligations for the various capital projects an annual contribution of $2.4 million is required. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of this Reserve: Funds continue to be budgeted in the Current Budget to build up this reserve to fund future capital growth of the City. The draws in the current year were to finance external subdivision works. This reserve should be maintained at a level to ensure that the funding is adequate to meet future capital growth in the City. APPENDIX B REGION TRANSIT RESERVE - G/L 4621 Actual Balance December 31, 2003 Transfers into the Reserve GO Transit Funding from Region Transfers out of the Reserve APTA Expenditures Pre-Audit Actual Balance December 31, 2004 $ 1,106,634 1,356,72O (1,437,613) $ 1,025,741 Purpose of this Reserve: This reserve fund was established in 2002 to capture funds raised by the Region for transit purposes and not immediately required. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of this Reserve: Transfer into the Reserve represents funding of $1,356,720 received from the Region of Durham. Funds were transferred out of this reserve to finance the 2004 current and capital operations of Ajax Pickering Transit Authority (APTA). The amount transferred in 2004 was $1,437,613 bringing the year-end December 31,2004 balance to $1,025,741. The balance of this Reserve is expected to be used to finance APTA Capital Budget and City related transit costs in 2005. APPENDIX B RESERVE FOR CONTINUING STUDIES & CONSULTING - G/L 4622 Actual Balance December 31, 2003 Transfers into the Reserve Continuing Consulting Work or Studies Transfers out of the Reserve Pre-Audit Actual Balance December 31, 2004 $ 141,884 119,3O4 (28,029.) $ 233,159 Purpose of this Reserve: This reserve was established to capture any unspent annual Current Budget provisions related to consulting, continuing studies, professional and legal fees. Under Generally Accepted Accounting Principles, the approval to expend funds for these efforts ceases at year-end, however work may continue beyond that date. The establishment of this fund enables the transfer of unspent funds into future year and accommodates this frequent timing difference between the approval and the expenditure. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of this Reserve: There would be no recommended maintenance levels. Funds transferred to this reserve will be used to fund the balance of the expenditures still to be incurred for incomplete studies or consulting contracts. Expenditures incurred in 2004 for the amount of $28,029 pertained to consulting work that were transferred into the Reserve in the prior year. An additional amount of $119,304 has been transferred-in for future work. APPENDIX B RESERVE FOR VEHICLE REPLACEMENT - G/L 4624 Actual Balance December 31, 2003 Transfers into the Reserve 25,000 Transfers out of the Reserve Pre-Audit Actual Balance December 31, 2004 $ 25,000 Purpose of this Reserve: This reserve was newly established in 2004 to begin building up funds to finance the cost of replacing the City's aging fleet. The interest income on these funds form part of the annual Current Budget General Government Revenue. Recommended Maintenance Levels of this Reserve: There would be no recommended maintenance levels. Funds transferred to this reserve will be committed to fund the purchase of new vehicles. ~TTACHMENt ~;~ ¥i ', REPORT# APPENDIX C RESERVE FUND FOR COMMUNITY FACILITIES - G/L 4225 Actual Balance December 31, 2003 Transfers into the Reserve Fund Capital Fund - Return to Source Interest Earned on External Investments Transfers out of the Reserve Fund Transfer to Capital Fund -Property Maint., Community Centres, Museum Pre-Audit Actual Balance December 31, 2004 11,466 $ 386,726 11,466 (17,588) $ 380,604 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. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve: The balances in this fund have fluctuated from the 2001 year Iow of $69,102 to the high in 1998 of $773,483. Other than interest income earned, there was no transfer to this reserve fund in 2004. Expenditures are transferred out of Reserve Funds only when incurred, therefore the amount committed but not incurred at end of 2004 is $192,210. Taking these commitments into consideration, the uncommitted balance of funds available is $188,394. Additional amounts must be provided to this fund. APPENDIX C RESERVE FUND FOR DEVELOPMENT CHARGES - G/L 4227/4229 Actual Balance December 31, 2003 Transfers into the Reserve Fund Net Developer Contributions Interest Earned on External Investments Interest Earned on Internal Loans Transfers out of the Reserve Fund: Transfer to Revenue Fund - Develop. Charge Study Transfer to Capital Fund: External Subdivision Works Roads Pre-Audit Actual Balance December 31, 2004 $ 3,709,465 395,752 375,338 (78,673) $ (709,773) $ 15,804,668 4,480,555 (788,446) $ 19,496,777 Purpose of this Reserve: This is an "obligatory" reserve fund and as such is governed by Provincial legislation, 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 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, 2001. 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. This reserve fund has unspent commitments of $2,672,169. The pre-audit actual balance of $19,496,777 would be reduced by this amount to reflect an uncommitted balance of funds available of $16,824,608. APPENDIX C RESERVE FUND FOR CAPITAL WORKS - G/L 4228 Actual Balance December 31, 2003 Transfers into the Reserve Fund Interest Earned on External Investments Transfers out of the Reserve Fund Parks & Recreation Complex-Core Pre-Audit Actual Balance December 31, 2004 $ 535,849 16,761 (250,000) $ 302,610 Purpose of this Reserve: This Fund is a "discretionary" one and was established pursuant to section 417(1 )(2) of the Municipal Act, 2001 for specified purposes by Council related to the acquisition of assets. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve Fund: Between the years of 1998 to 2000, the balances have been maintained at $600,000 to $800,000. There has been no major contribution to this Reserve Fund in the past four years. The value of the unspent commitments at the end of 2004 is $13,822. Taking these unspent commitments into account, the uncommitted balance available at December 31, 2004 will be $288,788. Major additional contributions will be required in future years. APPENDIX C RESERVE FUND FOR PARKLAND - G/L 4230 Actual Balance December 31, 2003 Transfers into the Reserve Fund Developers Contributions Interest Earned on External Investments Interest Earned on Internal Loans Transfers out of the Reserve Fund Transfer to Capital Fund Parks Other Development Parks-Tractor & Gangmower Playground Equipment Progress Frenchman's Park Pre-Audit Actual Balance December 31, 2004 $ 749,449 38,288 41,072 $ (129,143) (155,879) (241,049) (95,129) $ 1,959,087 828,809 (621,200) $ 2,166,696 Purpose of this Reserve Fund: This is an "obligatory" reserve fund and it was established pursuant to section 417(1)(2) of the Municipal Act, 2001 as required by subsections 42(1), (5), (6), (7), (8) and (9) of the Planning Act. This fund is governed by legislation, regulation or agreement and requires revenues received for the special purposes to be segregated from the general revenues of the municipality. Obligatory Reserve Funds must be created whenever a statute requires revenues for a special purpose to be segregated from the general revenues of the municipality and the revenue is to be used solely for the purpose prescribed by statute. The interest income on these funds form pad of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve Fund: Due to the obligatory nature of this fund, there are no limits on this fund. The value of the unspent commitments at end of 2004 is $125,973. The pre-audit balance of $2,166,696, taking into account the unspent commitments, will provide an uncommitted balance available of $2,040,723 as at December 31, 2O04. APPENDIX C RESERVE FUND FOR PUBLIC WORKS - G/L 4232 Actual Balance December 31, 2003 Transfers into the Reserve Fund Developer Contributions Interest Earned on External Investments Transfers out of the Reserve Fund Transfer to Capital Fund - Property Maint., Roads & Sidewalk Transfer to Third Party Reserve Fund Pre-Audit Actual Balance December 31, 2004 $ 1,465,425 $ 3O, 132 45,765 75,897 (83,784) (305,094) (388,878) $ 1,152,444 Purpose of this Reserve Fund: This fund was established by Council pursuant to section 417(1)(2) of the Municipal Act, 2001. The purpose of the reserve fund is to acquire fixed assets, 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 committed to under various subdivision agreements. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve Fund: The "average" annual balance of this fund over the last four years has been approximately $1.38 million. This reserve fund should be kept at least at this level in the future. Staff will periodically review the need for this level with the requirements contained in the capital budget and four year program and report any different findings to Council. The value of unspent commitments for 2004 is $111,892. The pre-audit balance of $1,152,444 after taking into account the unspent commitments will provide an uncommitted balance of funds available at $1,040,552 as of Dec. 31,2004. APPENDIX C RESERVE FUND FOR WORKERS SAFETY INSURANCE BOARD - G/L 4234 Actual Balance December 31, 2003 Transfers into the Reserve Fund Contribution from Current Fund Interest Earned on External Investments Transfers out of the Reserve Fund Claims and Other Related Costs Insurance Costs Contribution to Health & Safety Program Pre-Audit Actual Balance December 31, 2004 $ 357,894 14,926 $ (80,090) (86,692) (8,330) $ 181,023 372,820 (175,112) $ 378,731 Purpose of this Reserve Fund: This Reserve Fund has been established to provide for the annual costs of insurance coverage, contributions towards the health and safety program, and the payment of claims and other related costs now that the City is a Schedule 2 employer. This Reserve Fund was created in 2001 further to the recommendation passed in Council Resolution#127/01 and in compliance with Workplace Safety & Insurance Act. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve Fund: In 2004, the contributions were more than double the claims experience for the year, thus resulting to a built-up in the balance of the Reserve Fund. As Schedule 2 operates on the self-insured principle, for 2005 the anticipated savings between contributions and claims experience will be transferred to this Reserve Fund to build up the fund balance in the event of any catastrophic claim- related costs, which may occur. Should that be insufficient, additional funding may have to be considered in the 2006 budget. APPENDIX C THIRD PARTY/DEVELOPERS CONTRIBUTIONS RESERVE FUND - G/L 4235 Actual Balance December 31, 2003 Transfers into the Reserve Fund Contributions from Developers/Third Parties Transfer from Public Works Reserve Fund Interest Earned on External Investments $ 280,894 $ 305,094 79,397 $ 1,024,691 665,385 Transfers out of the Reserve Fund Transfer to Capital Fund-Prop. Maint. &Rec. Complex Pre-Audit Actual Balance December 31, 2004 (89,000) $ 1,601,076 Purpose of this Reserve Fund: This reserve fund was established by Council pursuant to Section 417(1) of the Municipal Act, 2001. The purpose of this reserve fund is to capture contributions from developers or third parties per development agreements or cost sharing arrangements for future capital projects. This Reserve Fund is not obligatory however, the collections are committed for a specific purpose and not available for general use. Unless specified, the City is under no obligation to pay interest to any developers or third parties. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve No reserve fund limits are appropriate for this fund as collection and commitment of funds are dependent upon development agreements or cost sharing arrangements. APPENDIX C ONTARIO TRANSIT RENEWAL RESERVE FUND - G/L 4236 Actual Balance December 31, 2003 Transfers into the Reserve Fund Contribution from Ministry of Transportation Interest on External Investments-reversal Transfers out of the Reserve Fund APTA Capital Expenditures Pre Audit Actual Balance December 31, 2004 $ 59,888 (922) $ 14,957 58,966 (59,888) $ 14,035 Purpose of this Reserve Fund: This is an "obligatory" Reserve Fund established to capture funding received from Ministry of Transportation for the sole purpose of funding acquisition of APTA vehicles or for any major vehicle refurbishment. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve Fund: No reserve fund limits are appropriate for this fund as availability of funds is dependent on the amount of grant received. The amount of $59,888 received from the Ministry of Transportation represents City of Pickering's share of the grant under the Ontario Transit Renewal Program. Commencing the latter half of 2003, funds have been provided from the Ontario Transit Renewal Program as expenditures are incurred. Thus, the same amount has been transferred-out to fund the acquisition of vehicles under APTA. As a result, this Reserve Fund may no longer be needed and the balance is expected to be nil as we continue to draw from the leftover funds. The remaining funds balance of $14,035 was an unspent amount from the 2003 grant. APPENDIX C SQUASH COURTS RESERVE FUND - G/L 4237 Actual Balance December 31, 2003 Transfers into the Reserve Fund Surcharge on Memberships Interest on External Investments Transfers out of the Reserve Fund Pre Audit Actual Balance December 31, 2004 25,1 O0 1,163 $ 7,45O 26,263 $ 33,713 Purpose of this Reserve Fund: This Reserve Fund was established to capture funds from Pickering Squash Club memberships' surcharges, corporate sponsorships, third party contribution and any such funds as the Council may approve. This Reserve Fund shall be used for the purpose of paying expenses related to the provision of double squash courts. This Reserve Fund was newly created in 2003 further to the recommendation passed in Council Resolution #79/03, Item 5 per Report to Council CS 40-03. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve Fund: No reserve fund limits are appropriate for this fund. APPENDIX C PROVINCIAL DEDICATED GAS TAX RESERVE FUND - G/L 4238 Actual Balance December 31,2003 Transfers into the Reserve Fund Prov. of Ontario Interest on External Investments 161,515 161,515 Transfers out of the Reserve Fund Pre Audit Actual Balance December 31, 2004 $ 161,515 Purpose of this Reserve Fund: This Reserve Fund was established to capture funds from the Province of Ontario for the new provincial gas tax revenue program. This Reserve Fund shall be used for the purpose of paying eligible public transportation expenditures, to offset Pickering's share of the costs for funding the Ajax Pickering Transit Authority. This Reserve Fund was newly created in 2004 further to the recommendation passed in Council Resolution #167/04, Item 3 at the Council Meeting of December 20, 2004 per Report to Council CS 56-04. The interest income on these funds form part of the Reserve Fund as per the Municipal Act, 2001. Recommended Maintenance Levels of this Reserve Fund: No reserve fund limits are appropriate for this fund. Under this program, the provincial government will provide one cent a litre of the provincial gas tax funding in 2004. This will increase to 1.5 cents in 2005 and two cents in 2006.